What's Behind The 2x Jump In AbbVie Stock?

Core Insights - AbbVie stock (NYSE: ABBV) has more than doubled in value since early January 2021, increasing from $90 to around $195, while the S&P 500 rose about 50% during the same period [1] - The significant rise in AbbVie's stock price is attributed to an 80% increase in the company's P/S ratio, which is now at 6.4x compared to 3.6x in 2020 [1] - AbbVie has experienced inconsistent stock returns, with 32% in 2021, 24% in 2022, and 0% in 2023, underperforming the S&P 500 in 2023 [2] Financial Performance - AbbVie's revenue rose 19% from $45.8 billion in 2020 to $55.0 billion in the last twelve months, largely due to the Allergan acquisition [4] - Humira, AbbVie's blockbuster drug, saw sales peak at $21.2 billion in 2022 but fell 32.2% year-over-year to $14.4 billion in 2023 due to biosimilar competition [4] - New drugs Skyrizi and Rinvoq generated $11.7 billion in 2023, reflecting a 53% year-over-year growth, while Vraylar sales increased 35% year-over-year to $2.8 billion [5] Market Position and Valuation - AbbVie is expected to deliver mid-single-digit average annual top-line growth over the next three years despite challenges with Humira [6] - The stock is currently trading at 6.3x revenues, compared to an average P/S ratio of 4.4x over the last three years, indicating it may be fully valued [3] - The average analyst price estimate for ABBV is $197, aligning with the current market price, suggesting that the stock is fully valued [6]