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Why AbbVie (ABBV) Dipped More Than Broader Market Today

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In the latest trading session, AbbVie (ABBV - Free Report) closed at $179.86, marking a -0.59% move from the previous day. The stock fell short of the S&P 500, which registered a loss of 0.19% for the day. Elsewhere, the Dow gained 0.1%, while the tech-heavy Nasdaq lost 0.54%.

The drugmaker's shares have seen an increase of 4.4% over the last month, surpassing the Medical sector's gain of 2.91% and the S&P 500's gain of 3.18%.

The upcoming earnings release of AbbVie will be of great interest to investors. The company's upcoming EPS is projected at $2.34, signifying a 4.88% drop compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $11.94 billion, indicating a 2.31% downward movement from the same quarter last year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $11.16 per share and revenue of $54.5 billion. These totals would mark changes of +0.45% and +0.33%, respectively, from last year.

Investors should also take note of any recent adjustments to analyst estimates for AbbVie. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.05% higher. AbbVie is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that AbbVie has a Forward P/E ratio of 16.21 right now. This valuation marks a premium compared to its industry's average Forward P/E of 14.3.

We can additionally observe that ABBV currently boasts a PEG ratio of 2.3. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Large Cap Pharmaceuticals was holding an average PEG ratio of 1.73 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 195, which puts it in the bottom 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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