ALERT COMES AT LOW POINT FOR ABBV AND SIGNALS MAJOR REVERSAL OF OVER 15 POINTS
AbbVie stock outperformed S&P 500 with a +16% to 9.41% return since November 2023, despite Humira revenue declining 38% to $8.99 billion. Immunology drugs Skyrizi and Rinvoq grew over 50% year-over-year, projecting combined revenue exceeding $31 billion by 2027. Despite Imbruvica's 7% decline, the oncology portfolio grew 11% through Venclexta and Elahere's strong performance.
The Trump administration's proposed tariffs on pharmaceuticals have caused significant market turmoil today, with major Pharma stocks plummeting globally. Despite pledges to increase U.S. manufacturing, companies like Eli Lilly and Novo Nordisk are suffering substantial share price declines. The feasibility of relocating drug manufacturing to the U.S. is highly questionable, potentially leading to drug shortages and higher domestic prices.
European Commission approves ABBV's Rinvoq for its eighth indication, giant cell arteritis.
Shares of pharma giants like PFE, J&J, AZN, MRK and ABBV decline on investor concerns that retaliatory tariffs could drive up drug prices for U.S. consumers.
What should investors do when stocks are tanking over the short term? Probably the best answer is to think long term.
One factor that keeps some investors away from healthcare stocks is the sector's dearth of generous and reliable dividend payers. This stands to reason, as nearly every stage of drug development and marketing is resource- and capital-intensive, and as a result, cash can be in short supply.
"Buy and hold" is a simple strategy for investors, but it can be a hard one to stick to in actual practice. That's because many people want to pick stocks and trade them, and feel like they need to actively intervene to generate significant gains.
Those who own ABBV stock may stay invested as the company has faced its biggest challenge quite well and looks set to return to robust growth in 2025.
Leerink Partners analyst David Resinger warned his clients on Sunday that the tariff risks to the industry are 'underappreciated.'
Dividend Aristocrats are outperforming the S&P 500 in 2025, demonstrating resilience, with NOBL up 1.78% YTD versus SPY's 4.9% decline. Top performers include Consolidated Edison (+22.98%), Brown & Brown (+20.65%), and AbbVie (+16.61%), showcasing strong double-digit gains. 29 out of 69 Dividend Aristocrats have announced dividend increases in 2025, with an average growth rate of 4.15%.
I don't see an obvious bias in AbbVie Inc.'s risk/return ratio. But I see it as a solid hold under current conditions. The company is grappling with diminishing Humira sales and is also trading at an above-average P/E. However, I see a potential profit margin expansion and also a healthy EPS growth ahead due to many catalysts.