AbbVie Stock Rises 16% Year to Date: Time to Buy, Sell or Hold?

Core Viewpoint - AbbVie has successfully managed the loss of exclusivity for its blockbuster drug Humira by launching new immunology drugs, Skyrizi and Rinvoq, which are expected to drive revenue growth in the coming years [5][6][24]. Financial Performance - AbbVie stock has increased by 16.1% this year, outperforming the industry average of 4.0% and also surpassing the sector and S&P 500 index [1][3]. - The company anticipates a return to robust revenue growth in 2025, following the decline due to Humira's loss of exclusivity [6][24]. - AbbVie’s ex-Humira drugs saw a reported growth of approximately 19% in 2024, exceeding internal expectations [23]. Product Performance - Skyrizi and Rinvoq generated combined sales of $17.7 billion in 2024, with expectations to exceed$31 billion by 2027 due to strong market growth and new indications [8][9]. - The drugs are particularly strong in the inflammatory bowel disease market, including ulcerative colitis and Crohn's disease, and have shown competitive advantages in clinical studies [8][9]. Pipeline and Acquisitions - AbbVie has a diverse pipeline with several early/mid-stage candidates that have blockbuster potential, with multiple regulatory submissions and approvals expected in the next 12 months [11][12]. - The company has been actively acquiring new technologies and candidates, signing over 20 early-stage deals since the beginning of 2024, including a recent entry into the obesity treatment space [13]. Challenges and Market Conditions - AbbVie faces challenges such as the erosion of Humira's sales due to biosimilars and declining sales of Juvederm fillers, which fell by 14.6% in 2024 [14][15]. - The aesthetics portfolio's global sales declined by 0.6% in 2024, with a lowered long-term growth guidance for this segment [16]. Valuation and Estimates - AbbVie shares currently trade at a price/earnings ratio of 16.21, slightly lower than the industry average of 16.28, but higher than its five-year mean of 11.88 [17]. - The Zacks Consensus Estimate for 2025 earnings has increased from $12.18 to$12.30 per share over the past 60 days, indicating positive sentiment [19].