Key Takeaways
- AbbVie stock is up in the past month to a new 52-week high, mostly because investors moved out of AI stocks and into big drugmakers led by Eli Lilly.
- AbbVie’s own news was steady, but a higher valuation did most of the work, and its forward P/E is now well above its five-year average.
- Consensus expects adjusted EPS to climb from $10.00 in 2025 to $18.10 in 2028, and the stock now needs that growth to keep rising.
- Third-quarter results beat on revenue and EPS this morning, Skyrizi topped UBS’s $5.7 billion forecast, and AbbVie raised its 2026 adjusted EPS guidance to $13.95 to $13.99.
AbbVie (ABBV) stock is up 10% in the past month and just hit a fresh 52-week high. Third-quarter results out this morning beat on revenue and earnings.
Most of the month’s gain came from a rotation into big drugmakers, led by Eli Lilly (LLY). AbbVie’s own news was steady, and one piece of it reaches Johnson & Johnson (JNJ): the FDA cleared at-home Skyrizi starts in Crohn’s disease. J&J’s Tremfya has offered that since March 2025.
Big pharma became the market’s safe place
A hotter-than-expected September inflation report on Oct. 14 pushed money out of AI stocks and into big drugmakers. On Oct. 20 the group rallied again, as Lilly hit a record high and the S&P 500 Healthcare Index touched one too.
Lilly has gained 16% in the past month, while the Nasdaq 100 fell 3%.
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AbbVie’s own news kept coming
On Oct. 5, AbbVie lowered its 2026 adjusted EPS guidance to a range of $13.76 to $13.96, from $13.87 to $14.07. The cut covers $216 million of third-quarter acquired IPR&D and milestones expense. Shares didn’t react.
On Oct. 22, lutikizumab met its Phase 3 goal in hidradenitis suppurativa: 31.4% of patients hit the main goal, against 23.4% on placebo. RBC Capital said the data “underwhelms,” and the stock barely moved.
The next day, the FDA approved at-home Skyrizi starts in Crohn’s. In September, Chief Commercial Officer Jeff Stewart said full paid access “will probably take 60 or 90 days.” That pushes the sales payoff into 2027.
The approval closes a gap with J&J, whose Tremfya sales jumped 68% last quarter. Skyrizi brought in $5.78 billion in the third quarter, up 22.7% and ahead of UBS’s $5.7 billion forecast. Can Skyrizi keep its lead while Tremfya grows that fast?
The multiple did most of the work
CEO Rob Michael thinks the stock has further to go. “I think there’s obviously more room for multiple expansion as the pipeline matures,” he said at Morgan Stanley’s healthcare conference on Sept. 15.
The multiple has already come a long way. AbbVie trades at 19x forward earnings, up from about 15x at the end of March and well above its five-year average of 14x:
The only time it was higher in the last five years was a year ago, at nearly 20x.
Analysts’ average target has risen from $237 a year ago to $283, but the stock has run past it:
Barclays raised its target to $325 on Oct. 21, near the top of a $200 to $328 range.
Earnings have to carry it from here
Consensus expects adjusted EPS to climb from $10.00 in 2025 to $18.10 in 2028. And that growth is what a 19x multiple is pricing in:
The first test came this morning, and AbbVie passed it. Third-quarter revenue rose 10.3% to $17.4 billion, ahead of its own $17.2 billion guide and a hair above consensus. Adjusted EPS of $3.82 also beat the $3.73 to $3.77 guide.
AbbVie also raised its 2026 adjusted EPS guidance to a range of $13.95 to $13.99. The release didn’t update revenue guidance, which AbbVie has raised twice this year. A third raise now hinges on the call.
Not much room left at 19x
My take: AbbVie’s business is in great shape, and the stock already prices that in. At 19x, close to its five-year peak, I don’t see much room for the multiple to keep expanding.
Debt argues for patience, too. Management has pushed its 2x net leverage goal out to two to three years after closing the Apogee deal. So I’d want to hear a third revenue raise on the call before buying at a 52-week high.
Still, this morning’s beat helps. Skyrizi cleared UBS’s forecast and EPS guidance went up, so a third revenue raise would make 19x a lot easier to defend.
So what is AbbVie stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
