Latest news with #Humira
Forbes
9 hours ago
- Business
- Forbes
AbbVie Stock At $190: Premium Pricing For A Transformation Story
CANADA - 2025/04/03: In this photo illustration, the AbbVie logo is seen displayed on a smartphone ... More screen. (Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images) AbbVie (NASDAQ:ABBV) has distinguished itself as one of the top performers in the healthcare sector this year, with its stock rising by 6% while the broader S&P 500 healthcare index fell by 1%. This outperformance is indicative of investor confidence in the pharmaceutical giant's ambitious transformation strategy as it navigates the post-Humira period. AbbVie's journey starts with recognizing the scale of its Humira challenge. Once the world's leading pharmaceutical drug (excluding the Covid-19 vaccines), Humira achieved peak sales of $21.2 billion in 2022. However, biosimilar competition has severely impacted its market share, with sales dropping 58% from its peak to $9 billion last year. This decrease signifies a substantial revenue gap that could have incapacitated many companies. Instead of yielding to this pressure, AbbVie has embarked on an aggressive acquisition strategy to enhance its portfolio and broaden its revenue sources. The company's approach has been both methodical and significant, focusing on high-growth therapeutic areas with substantial market potential. For investors seeking lower volatility than individual stocks, the Trefis High Quality portfolio offers an alternative — having outperformed the S&P 500 and delivered returns surpassing 91% since its inception. Additionally, see – SOFI Stock To $30? An Acquisition Spree with Strategic Intent Since the start of 2024, AbbVie has executed an impressive series of acquisitions totaling over $22 billion in deal value. The acquisitions cover various therapeutic areas, showcasing the company's dedication to diversification: This acquisition spree is indicative of more than just opportunistic dealmaking—it signifies a tactical plan to secure leadership positions in high-growth therapeutic sectors while minimizing reliance on any singular asset. AbbVie's history implies this acquisition strategy could yield remarkable returns. The firm's 2016 collaboration with Boehringer Ingelberg serves as an example of this success. For an upfront investment of $595 million, AbbVie obtained global rights to what would become Skyrizi for psoriasis and related indications. That investment has proven immensely profitable, with Skyrizi producing $11.7 billion in sales in 2024. This success story offers a blueprint for how AbbVie's current acquisitions might progress, contingent upon the company's ability to effectively integrate these assets and realize their commercial potential. Even with Humira's declining sales, AbbVie managed to achieve 4% revenue growth last year, showcasing the resilience of its broader portfolio and the preliminary advantages of its acquisition strategy. The company anticipates accelerating revenue growth to high single-digits over the next few years, with even greater earnings growth projected as margins enhance. Valuation Considerations and Market Premium Investors have responded positively to AbbVie's strategic methodology, boosting the stock to approximately $190 per share. At present, the company is trading at 18.5 times its trailing adjusted earnings of $10.27 per share. This valuation signifies a considerable premium relative to AbbVie's historical average of 14x over the past three years and most major pharmaceutical competitors. Bristol Myers Squibb, Merck, and Pfizer are trading at 10 times or less their trailing adjusted earnings, while Johnson & Johnson, Amgen, and Gilead command valuations of 14–15 times. AbbVie's premium valuation illustrates investor faith in its growth strategy and operational capabilities. This elevated multiple seems justified considering the company's robust revenue growth trajectory and ongoing pipeline expansion. As the newly acquired assets contribute to growth and margins improve, the valuation premium may prove to be sustainable or even expand further. However, we could be mistaken in our evaluation. AbbVie's aggressive acquisition strategy has incurred costs to its balance sheet stability. The company currently holds $70 billion in debt against a market capitalization of $336 billion, leading to a debt-to-equity ratio of 21.3%—moderately above the S&P 500 average of 19.4%. More concerning is the company's cash position in relation to its asset base. With only $5.2 billion in cash and equivalents out of $136 billion in total assets, AbbVie's cash-to-assets ratio is alarmingly low at 3.8%. This limited financial flexibility could limit future strategic opportunities or compel the company to rely more extensively on debt financing for future acquisitions. AbbVie's evolution from a Humira-reliant firm to a diversified pharmaceutical powerhouse represents one of the industry's most ambitious strategic shifts. For investors ready to accept balance sheet risks and a premium valuation, the company's execution history and growth potential position it as a possibly attractive long-term investment, even at current levels around $190 per share. On a connected note, are you aware that Merck might confront the same challenges AbbVie did a few years ago with Humira? Explore our insights on – Merck Stock's Ticking Keytruda Time Bomb. Now, there always remains a meaningful risk when investing in a single, or just a handful of stocks. Consider the Trefis High Quality (HQ) Portfolio which, with a collection of 30 stocks, has a track record of comfortably outperforming the S&P 500 over the past 4-year period. Why is that? Collectively, HQ Portfolio stocks delivered superior returns with lower risk compared to the benchmark index; less of a roller-coaster experience, as evidenced in HQ Portfolio performance metrics.
CNBC
2 days ago
- Business
- CNBC
AbbVie to buy Capstan Therapeutics for up to $2.1 billion
AbbVie said on Monday it will acquire cell therapy developer Capstan Therapeutics in a cash deal worth up to $2.1 billion. Capstan develops CAR-T therapies, a type of treatment that uses a patient's own immune cells, specifically T cells, to fight diseases. Its main drug, CPTX2309, is currently in development for the treatment of autoimmune diseases. AbbVie has been focusing on expanding its pipeline since its blockbuster arthritis drug, Humira, lost patent protection last year.
Globe and Mail
4 days ago
- Business
- Globe and Mail
3 Dividend Stocks to Double Up on Right Now
Buy, sell, or hold? That's the question investors must continually ask about each stock in their portfolio. The correct answer might be to sell if your original investing thesis has changed. In many cases, the best course of action is to simply stay the course. Sometimes, though, adding more to your position makes sense. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Every now and then, the smartest strategy is to back up the truck and load up on more shares. Here are three dividend stocks to double up on right now. 1. AbbVie If there were a dividend hall of fame, I think AbbVie (NYSE: ABBV) should be in it. The major drugmaker is a Dividend King with 53 consecutive years of dividend increases. Since spinning off from Abbott in 2013, AbbVie has more than quadrupled its dividend payout. Its forward dividend yield currently tops 3.5%. Why double up on AbbVie now? Its dividend is one reason. However, an even more compelling motivation is that the company's growth should accelerate nicely over the next few years. AbbVie continues to be somewhat weighed down by the early 2023 loss of exclusivity for its then-top-selling drug, Humira. But the more time passes, Humira will have less of a drag on growth. Meanwhile, sales for the company's two successors to Humira -- Rinvoq and Skyrizi -- are soaring. AbbVie's pipeline also features several potentially solid growth drivers. The main argument against investing more heavily in AbbVie stock now is probably the Trump administration's threats of tariffs on pharmaceutical imports to the U.S. and the implementation of a most-favored-nation drug pricing plan. I suspect, though, that these won't derail AbbVie's growth much, if at all, over the near term and will likely be non-issues in the long term. 2. Enterprise Products Partners Want especially juicy income? Take a look at Enterprise Products Partners (NYSE: EPD). This master limited partnership (MLP) offers a forward distribution yield of 6.96%. Here's more good news: Enterprise has increased its distribution for 26 consecutive years. Yes, this sky-high distribution is a key factor behind my including Enterprise Products Partners on the list of dividend stocks to double up on right now. The stock won't have to deliver much in the way of appreciation to generate a double-digit percentage total return. I expect this midstream energy stock will provide nice growth, though. The U.S. is experiencing an explosion in the number of data centers, largely due to the breakneck adoption of artificial intelligence (AI). Many of these data centers will be powered by natural gas. That's great news for Enterprise Products Partners. Domestic demand isn't the only growth driver for Enterprise Products Partners, either. As co-CEO Jim Teague said in the MLP's first-quarter earnings call, "The bottom line is the world needs U.S. oil, natural gas, and natural gas liquids to provide for their people and to grow their economies." He's right -- and much of those hydrocarbons will flow through Enterprise's pipelines. 3. Realty Income Realty Income (NYSE: O) is listed third among the dividend stocks to double up on now, but it's only because I've listed the stocks alphabetically. There's a lot to like about this real estate investment trust (REIT). For starters, Realty Income's forward dividend yield is 5.66%. The company distributes its dividend monthly. It has also increased its dividend for 30 consecutive years, with a total of 131 dividend hikes during that period. If that's not enough to impress you, consider that Realty Income has generated a positive total operational return every year since its initial public offering in 1994. The stock's average total return since then is roughly 11%. Realty Income's growth prospects look good, too. The REIT targets a total addressable market of $14 trillion. Around $8.5 trillion of that market is in Europe, where the company has only two major rivals. Should you invest $1,000 in AbbVie right now? Before you buy stock in AbbVie, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AbbVie wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor 's total average return is1,062% — a market-crushing outperformance compared to177%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 23, 2025
Globe and Mail
5 days ago
- Business
- Globe and Mail
AbbVie Adds More Than $24B in 6 Months: How to Play ABBV Stock
AbbVie ABBV stock has risen 8.0% in six months, adding more than $24 billion to its market value. AbbVie has successfully navigated the loss of exclusivity ('LOE') of its blockbuster drug, Humira, by launching two other successful new immunology medicines, Skyrizi and Rinvoq, which are performing extremely well, bolstered by approvals in new indications and are expected to support top-line growth in the next few years. AbbVie has several early/mid-stage candidates that have the potential to drive long-term growth. AbbVie, however, faces its share of headwinds, like Humira biosimilar erosion, increasing competitive pressure on Imbruvica and slowing sales of its aesthetics franchise. Let's understand the company's strengths and weaknesses to better analyze how to play ABBV stock amid the market value growth. ABBV's Successful New Drugs — Skyrizi and Rinvoq AbbVie lost patent protection for Humira in the United States in January 2023 and in the EU in 2018. Humira's sales are declining due to the LOE and biosimilar erosion. However, with approvals for many new indications, sales of Skyrizi and Rinvoq have successfully replaced Humira, which once generated more than 50% of its total revenues. Skyrizi and Rinvoq generated combined sales of $5.1 billion in the first quarter of 2025, reflecting growth of more than 65%. The drugs are seeing strong performance across all approved indications, especially in the popular inflammatory bowel disease (IBD) space, which includes two conditions — ulcerative colitis (UC) and Crohn's disease (CD). Importantly, Skyrizi and Rinvoq have demonstrated compelling head-to-head data against several novel therapies in clinical studies, which have given them a competitive advantage. AbbVie expects combined sales of Skyrizi and Rinvoq to be around $24.7 billion in 2025 and more than $31 billion by 2027. Strong immunology market growth, market share gains and momentum from new indications, such as the recent launch of Skyrizi in UC, as well as the potential for five new indications for Rinvoq over the next few years, are expected to drive these drugs' growth. ABBV Boasts an Attractive Pipeline AbbVie has several early/mid-stage pipeline candidates with blockbuster potential. The company expects several regulatory submissions, approvals and key data readouts in the next 12 months. ABBV has an exciting and diverse pipeline of promising new therapies in blood cancers and solid tumors, like ABBV-383, a BCMA CD3 bispecific (relapsed/refractory multiple myeloma) and Temab-A (metastatic colorectal cancer). Emrelis (previously Teliso-V), a promising antibody drug conjugate or ADC, was approved in the United States for previously treated non-squamous non-small cell lung cancer with high c-Met expression in May 2025. In other areas, some key pipeline drugs are lutikizumab for immunology indications and tavapadon for early Parkinson's disease. AbbVie expects to file a new drug application for tavapadon this year. AbbVie on an Acquisition Spree The company has been on an acquisition spree in the past couple of years, which is strengthening its pipeline. It has signed several M&A deals in the immunology space, its core area, while also inking some early-stage deals in oncology and neuroscience. It has signed more than 20 early-stage deals since the beginning of 2024, including promising technologies and innovative mechanisms that can elevate the standard of care in immunology, oncology and neuroscience. In early 2025, AbbVie bought rights to develop GUB014295 (ABBV-295), a long-acting amylin analog for the treatment of obesity, from Denmark's Gubra. The deal marked AbbVie's entry into the obesity space, dominated by Eli Lilly LLY and Novo Nordisk NVO. AbbVie plans to invest further in obesity. ABBV's Slowing Aesthetics Sales & Humira Erosion Sales of AbbVie's blockbuster drug Humira are declining due to biosimilar erosion. Humira volume is rapidly eroding compared to other novel mechanisms (including Skyrizi and Rinvoq). Humira sales declined by almost 50% in the first quarter of 2025, primarily due to faster erosion of its share as a result of biosimilar competition, as well as further molecule compression in the United States. AbbVie is witnessing declining sales of Juvederm fillers in the United States and China due to challenging market conditions. The slowing growth of the U.S. facial injectables market and persistent economic headwinds, which are affecting consumer spending in China, are hurting AbbVie's aesthetics portfolio sales, which declined 10.2% in the first quarter of 2025. ABBV Stock Price, Valuation and Estimate Revision AbbVie's stock has gained 7.1% so far this year against a decrease of 0.7% for the industry. The stock has also outperformed the industry and the S&P 500 index, as seen in the chart below. ABBV Stock Outperforms Industry, Sector & S&P 500 From a valuation standpoint, AbbVie is not very cheap. Going by the price/earnings ratio, the company's shares currently trade at 14.21 forward earnings, just slightly lower than 14.87 for the industry. The stock is cheaper than some other large drugmakers like Eli Lilly and Novo Nordisk, but is priced much higher than most other large drugmakers. The stock is also trading above its five-year mean of 12.44. ABBV Stock Valuation The Zacks Consensus Estimate for 2025 earnings has risen from $12.21 per share to $12.28, while that for 2026 has increased from $14.03 to $14.06 per share over the past 30 days. ABBV Estimate Movement Stay Invested in ABBV Stock Though AbbVie faces its share of near-term headwinds, the company has faced its biggest challenge — Humira's patent cliff — quite well and looks well-positioned for continued strong growth in the years ahead. AbbVie expects to return to robust revenue growth in 2025, which is just the second year following the U.S. Humira LOE, driven by its ex-Humira platform. AbbVie's ex-Humira drugs rose delivered robust sales growth of more than 21% (on a reported basis) in the first quarter of 2025. Boosted by its new product launches, AbbVie expects to return to robust mid-single-digit revenue growth in 2025 with a high single-digit CAGR through 2029, as it has no significant LOE event for the rest of this decade. A substantial portion of this growth is expected to be driven by the robust performance of Skyrizi and Rinvoq. Rising estimates for AbbVie, its solid pipeline and the prospect of growth in 2025 sales and profits are good enough reasons to stay invested in this Zacks Rank #3 (Hold) stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Picks Stock Most Likely to "At Least Double" Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren't winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%. See Our Top Stock to Double (Plus 4 Runners Up) >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Novo Nordisk A/S (NVO): Free Stock Analysis Report Eli Lilly and Company (LLY): Free Stock Analysis Report AbbVie Inc. (ABBV): Free Stock Analysis Report
Yahoo
24-06-2025
- Business
- Yahoo
Alvotech (ALVO): A Bull Case Theory
We came across a bullish thesis on Alvotech (ALVO) on M.V Cunha's Substack. In this article, we will summarize the bulls' thesis on ALVO. Alvotech (ALVO)'s share was trading at $10.37 as of 10th June. ALVO's trailing and forward P/E were 28.73 and 52.91 respectively according to Yahoo Finance. A scientist in a laboratory working on drug research. Alvotech is a vertically integrated biosimilars company focused on reducing global healthcare costs by developing more affordable versions of complex biologic drugs. With an asset-light commercialization strategy relying on global distribution partners, Alvotech retains R&D control while limiting upfront sales costs. Its proprietary Reykjavik-based facility, built for scale and flexibility, supports a diversified pipeline targeting high-value biologics like Humira and Stelara. Despite past delays in FDA approvals, the company is now gaining commercial traction, with AVT02 already launched across multiple geographies and AVT04's U.S. launch slated for Q4 2024. Financial momentum is building: adjusted operating cash flow turned positive in 2024, and Alvotech expects to reach free cash flow positive in 2025, enabling self-funding growth and potential deleveraging. However, the capital structure remains a key overhang, with over $1B in debt at a steep 12.4% interest rate weighing heavily on profitability. Execution risks also loom large — from regulatory hurdles and manufacturing concentration to limited product diversity and partner reliance. Valuation looks attractive on a long-term view: the stock trades at just ~3.75x projected 2028 EBITDA, and hitting its targets could imply a >30% IRR, even with dilution. Still, material weaknesses in internal controls and tariff risks add further complexity. While founder-CEO Róbert Wessman's significant ownership aligns interests, his attention is divided across ventures. For concentrated investors, the risk/reward may feel asymmetric, but for those with a wider net, Alvotech presents a high-upside, execution-dependent opportunity in one of healthcare's most important cost-saving frontiers. Previously, we summarized a on Medpace (MEDP), highlighting its capital-light model, high client retention, and durable biotech exposure. Similarly, Alvotech (ALVO) is seen as a biotech-driven healthcare play, but with a riskier, debt-laden profile and regulatory overhangs, making MEDP the steadier compounder while ALVO offers higher but less certain upside. Alvotech (ALVO) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 10 hedge fund portfolios held ALVO at the end of the first quarter which was 9 in the previous quarter. While we acknowledge the risk and potential of ALVO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey.
