While the FDA may be erring on the side of caution for now, ABBV stock is currently feeling the heat. Investors were banking on Rinvoq revenues to largely replace those lost by Humira. Humira is the latest drug to fall off the patent cliff for AbbVie, a concern for many long-term investors. These sorts of violent swings have become more commonplace in the Big Pharma space of late. However, most of the recent volatility has been to the upside, as investors seek growth stocks with better valuations.
- His long-term concern comes out of Washington which is proposing drug-pricing laws.
- Its Rinvoq drug will now be required to disclose a warning that it carries an increased risk of blood clots and death.
- At its current price, it offers a yield of 3.84%, rewarding longtime investors.
- Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.
Along with synergies, AbbVie expects the acquisition to provide significant cash flow generation. AbbVie and Allergan generated a combined operating cash flow of $19 billion in 2018. AbbVie is looking to use the new cash flow to reduce its debt and continue its dividend growth, which are reasons for investors to be happy. The FDA’s decision was rooted in data regarding Pfizer’s arthritis medicine Xeljanz. The two drugs in question are built around the same JAK-inhibiting approach, and in its later-stage testing it was shown to increase the risk of blood clots and related heart problems.
Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights owns shares why is abbvie stock dropping today of AbbVie and Pfizer. The Motley Fool has no position in any of the stocks mentioned.
Time To Upgrade!
Stockchase rating for AbbVie Inc. is calculated according to the stock experts’ signals. A high score means experts mostly recommend to buy the stock while a low score means experts mostly recommend to sell the stock. Life sciences companies are getting more interest from investors.
Indeed, AbbVie’s drug pipeline remains one of the strongest in this sector. Before Tuesday’s announcement, AGN stock had fallen around 32% over the past 12 months, while ABBV was down over 15%. The acquisition could provide a boost for AbbVie’s stock down the road as it is projected to increase the company’s cash flow as well as diversify its product portfolio. AbbVie is heavily reliant on revenue from Humira, which brought in $20 billion in revenue last year. But AbbVie has been looking to diversify its portfolio as cheaper alternatives are already becoming available in Europe.
Cincinnati Insurance Co Buys 4, Sells 1 In 2nd Quarter
On a similar note, the biopharma’s blood cancer franchise saw its global revenue sink by an eye-popping 9.1% in the second quarter, relative to the same period a year ago. AbbVie’s normally strong cancer unit contracted in the most recent quarter mainly due to a 17.1% drop in net revenue for the all-star blood disorder medication Imbruvica. The drug appears to be losing market share to newer competitors such as AstraZeneca’s Calquence. Much of this growth in ABBV stock over the recent years can be attributed to favorable changes in its revenues.
Calculated by Time-Weighted Return since 2002. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. The biopharma’s aesthetics and cancer franchises exhibited slower-than-expected growth during the quarter. New drugs from Eli Lilly and Novo Nordisk have shown striking results in studies. If insurers step up to back them, the drugs—and the stocks—could take off.
Even after this drop, though, AbbVie’s shares aren’t exactly cheap (with trailing P/E of about 30), and this JAK regulatory news will take a while to fully understand. All told, investors might be better off to sidestep this beaten-down biotech stock for the time being. The Internal Revenue Service has proposed rule changes that could significantly impact how beneficiaries will manage inherited retirement accounts. AbbVie’s strengths such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and expanding profit margins. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
The company released its first-quarter earnings before the market opened on Friday, and while most of the numbers were fairly positive, there were certain trends that may have bothered investors. The good news is the company reported revenue of $13.54 billion, up 4.1% year over year, and earnings per share of $2.51, compared to EPS of $1.99 in the same period a year ago. The bad news was AbbVie reported lower sales of cancer drug Imbruvica and immunology stalwart Humira, thanks to competition from newer therapies.
The stock’s 52-week low is $105.56 with a 52-week high of $175.91. Plug Power CEO Andy Marsh joins Yahoo Finance Live to discuss the Inflation Reduction Act, its impacts on the energy space, building a green hydrogen ecosystem, profitability, and growth. Allergan shareholders still need to vote to approve the deal, but it looks to be a great one for Allergan as many analysts believed the company was headed toward a split to increase shareholder value. AbbVie Inc. was recommended as a Top Pick by on . Read the latest stock experts ratings for AbbVie Inc.. In the last year, 38 stock analysts published opinions about ABBV-N.
Sign Up NowGet this delivered to your inbox, and more info about our products and services. The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. AbbVie closed at $156.35 in the latest trading session, marking a -1.89% move from the prior day. This move lagged the S&P 500’s daily gain of 1.61%. Meanwhile, the Dow gained 1.45%, and the Nasdaq, a tech-heavy index, added 0.36%.
I think overall, AbbVie is still a pretty good buy, especially if you’re an income-seeking investor. It’s a dividend aristocrat, wonderful dividend, high yield. The company is going to have plenty of cash flow, even with Humira losing exclusivity or facing biosimilar rivals https://xcritical.com/ in the US in a couple of years. It’s not a good stock for everybody, but I think it’s a pretty good stock for some types of investors. Overall, I think this is a negative and definitely warranted for the drop. I’m a little surprised it wasn’t already priced into the stock.
AbbVie stock is lower in early-morning trading on Monday after the company reported data for an early trial of its lung cancer treatment. AbbVie has benefited from the Allergan acquisition it completed in May 2020. We can also see that ABBV currently has a PEG ratio of 4.44. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate.
Abbv Media Sentiment
This news is a major blow for investors because Rova-T is widely believed to hold blockbuster potential. AbbVie’s stock was trading about 7.7% lower at $111.50 per share on Tuesday, The stock has a 52-week high of $121.50 and a 52-week low of $79.11. Rinvoq, unfortunately, was a key part of AbbVie’s plan. Wall Street estimated that the drug could bring in over $10 billion in sales a little past the middle of the decade. This new warning, however, could slow of the adoption rate for this entire class of potent medications.
Brian Feroldi has no position in any of the stocks mentioned. The drug in question is called rovalpituzumab tesirine, which goes by the nickname Rova-T. AbbVie shared a little bit of data from a phase 2 trial today that was studying Rova-T as a third-line treatment for relapsed/refractory small-cell lung cancer. About 16.92 million shares of AbbVie have been traded so far today, well above the company’s average trading volume of roughly 7.66 million shares per day. AbbVie stock is lower in early-afternoon trading on Tuesday as its Humira patent might be invalid and Paulson & Co. dissolved its stake in the company. George Budwell has no position in any of the stocks mentioned.
Blood cancer drug Venclexta had a reported $473 million in revenue, up 16.9% year over year. AbbVie ABBV stock fell over 15% through Tuesday morning trading. The significant drop came after the company announced that it will acquire Allergan PLC AGN in a deal worth approximately $63 billion. The drop brought AbbVie stock to a new 52-week low of $66.56 per share. Meanwhile, Allergan stock jumped about 27% after the news.
Looking forward, Humira sales will be impacted by biosimilar competition, implying a meaningful decline in annual sales over the coming years. In fact, this has led investors concerns, reflecting in a decline in its P/S multiple over the recent years. IF ABBV stock moved by -5% over five trading days, THEN over the next twenty-one trading days ABBV stock moves an average of 3%, with a good 66% probability of a positive return over this period. Rova-T is also viewed by investors as a key drug that will reduce the company’s reliance on the megablockbuster drug Humira in the years ahead. Humira currently accounts for about two-thirds of AbbVie’s total sales so it’s critical for the company to develop other blockbuster drugs to better diversify its revenue stream.
AbbVie is looking to expand Rinvoq beyond rheumatoid arthritis into eczema and psoriatic arthritis and ankylosing spondylitis. The ironic part of this news is that TNF inhibitors will benefit and AbbVie, of course, has Humira, which is a TNF inhibitor. But of course, investors are rightfully worried about the long-term prospects of Humira since the drug has a potential for having biosimilar competition as early as 2023. Furthermore, AbbVie will continue to benefit from its oncology drug – Imbruvica (in partnership with J&J JILL ) – which garnered $5.3 billion revenue in 2020, and its peak is estimated to be over $7 billion for AbbVie.