We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ABBV or MRK: Which Stock Should Investors Place Their Bet on in 2025?
Read MoreHide Full Article
Key Takeaways
ABBV offsets Humira losses with Skyrizi and Rinvoq, driving strong sales growth in 2025.
MRK leans on Keytruda but faces declining Gardasil sales and other vaccine headwinds.
ABBVs rising estimates, robust pipeline and stock gains position it ahead of MRK in 2025.
Merck (MRK - Free Report) and AbbVie (ABBV - Free Report) are prominent pharmaceutical companies with strong positions in oncology and immunology.
AbbVie also operates in aesthetics, neuroscience and eye care, while Merck has a broader focus that includes vaccines, neuroscience, diabetes, virology and animal health.
Oncology drives more than 60% of Merck’s total revenues, with its blockbuster cancer drug Keytruda contributing around 50% of pharmaceutical sales.
For AbbVie, immunology is the largest segment, led by key therapies like Humira, Skyrizi and Rinvoq, which together make up roughly half of its total revenues.
Both companies are experiencing steady sales and earnings growth and have strong pipelines with late-stage candidates. But which offers the better investment opportunity? A closer examination of their fundamentals, growth outlook and risks is needed to decide.
The Case for AbbVie
AbbVie has successfully navigated the loss of exclusivity (LOE) of its blockbuster drug, Humira, which once generated more than 50% of its total revenues. It has accomplished this by launching two other successful new immunology medicines, Skyrizi and Rinvoq, which are performing extremely well, bolstered by approvals in new indications, and should support top-line growth in the next few years.
Skyrizi and Rinvoq generated combined sales of $11.6 billion in the first half of 2025. Skyrizi sales are now annualizing at almost $18 billion and Rinvoq at over $8 billion. AbbVie expects combined sales of Skyrizi and Rinvoq to be more than $25 billion in 2025 and more than $31 billion by 2027.
AbbVie’s oncology and neuroscience drugs are also contributing to top-line growth. AbbVie’s oncology segment generated combined revenues of $3.3 billion in the first half of 2025, up 4.2% year over year as higher sales of Venclexta and contributions from new drugs, Elahere and Epkinly, more than offset declining Imbruvica sales due to competitive pressure. Sales of its neuroscience drugs increased 20.3% to almost $5 billion in the first half of 2025, driven by higher sales of Botox Therapeutic, depression drug Vraylar and newer migraine drugs Ubrelvy and Qulipta.
AbbVie has been on an acquisition spree in the past couple of years to bolster the early-stage pipeline that should drive long-term growth. Particularly, it is signing several M&A deals in the immunology space, its core area, while also signing some early-stage deals in oncology and neuroscience areas. AbbVie has executed more than 30 M&A transactions since the beginning of 2024.
However, the company faces some near-term headwinds like Humira’s biosimilar erosion, increasing competitive pressure on cancer drug Imbruvica and a slow market growth trend for Juvederm fillers in the United States and China due to challenging market conditions and weakened consumer sentiment.
As of June 30, 2025, AbbVie had $63.0 billion in long-term debt and short-term debt/obligations of $7.5 billion on its balance sheet. Cash and cash equivalents totaled approximately $6.5 billion. Its debt-to-capital ratio of 1.02 is much higher than the industry's average of 0.42.
The Case for MRK
Merck boasts more than six blockbuster drugs in its portfolio, with Keytruda being the key top-line driver. Keytruda has played an instrumental role in driving Merck’s steady revenue growth in the past few years. Keytruda’s sales are gaining from rapid uptake across earlier-stage indications, mainly early-stage non-small cell lung cancer. Continued strong momentum in metastatic indications is also boosting sales growth. Keytruda’s sales rose around 7% in the first half of 2025.
The company expects continued growth from Keytruda, particularly in early lung cancer. Merck is also developing a subcutaneous formulation of Keytruda that can extend its patent life. Merck is working on different strategies to drive Keytruda's long-term growth, with the drug expected to lose patent exclusivity in 2028.
Merck’s Animal Health business is a key contributor to its top-line growth, as Merck is recording above-market growth.
Merck has been making meaningful regulatory and clinical progress. MRK’s phase III pipeline has almost tripled since 2021, supported by in-house pipeline progress as well as the addition of candidates through M&A deals. This has positioned Merck to launch around 20 new vaccines and drugs over the next few years, with many having blockbuster potential. These include Merck’s new 21-valent pneumococcal conjugate vaccine, Capvaxive, and pulmonary arterial hypertension drug, Winrevair, which have the potential to generate significant revenues over the long term. Both products have witnessed a strong launch.
In July 2025, Merck announced a new multi-year optimization initiative, which is expected to save $3 billion in annual costs by the end of 2027.
However, Merck faces several challenges. Sales of Gardasil, Merck’s second-largest product, declined 48% in the first half of 2025. Sales of Gardasil are declining due to weak performance in China, which resulted from sluggish demand trends amid an economic slowdown. Gardasil sales are expected to decline significantly in 2025 from 2024 levels. The company is also seeing lower demand for the vaccine in Japan. Sales are expected to remain weak in Japan in the second half of 2025.
Sales of some other Merck vaccines, like Proquad, M-M-R II, Varivax, Rotateq and Pneumovax 23, also declined in the second quarter.
MRK is also seeing declining demand for its diabetes products and generic erosion of some drugs.
Though Keytruda may be Merck’s biggest strength and a solid reason to own the stock, it can also be argued that the company is excessively dependent on the drug, and it should look for ways to diversify its product lineup.
There are rising concerns about the firm’s ability to grow its non-oncology business ahead of the upcoming LOE of Keytruda in 2028.
It exited the second quarter with cash and cash equivalents of $8.6 billion against total debt (short + long term) of $35.4 billion, resulting in a debt-to-capital ratio of 0.41, which is just slightly lower than the industry's average of 0.42.
How Do Estimates Compare for ABBV & MRK?
The Zacks Consensus Estimate for ABBV’s 2025 sales and EPS implies a year-over-year increase of 7.5% and 18.9%, respectively. EPS estimates for both 2025 and 2026 have risen over the past 30 days.
ABBV Estimate Movement
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Merck’s 2025 sales and EPS implies a year-over-year increase of 1.2% and 16.7%, respectively. Estimates for MRK’s 2025 earnings have risen from $8.87 per share to $8.93 per share over the past 30 days, while those for 2026 have declined from $9.64 per share to $9.59 per share.
MRK Estimate Movement
Image Source: Zacks Investment Research
Price Performance and Valuation of ABBV & MRK
Year to date, AbbVie’s stock has risen 20.3%, while Merck’s stock has plunged 14.8%. The industry has risen 1.4% in the said time frame.
Image Source: Zacks Investment Research
ABBV is more expensive than MRK, going by the price/earnings ratio. AbbVie’s shares currently trade at 15.36 forward earnings, higher than 8.88 for Merck. AbbVie is also priced higher than 14.79 for the industry, while Merck is priced lower.
Image Source: Zacks Investment Research
However, both Merck and AbbVie are cheaper than other large drugmakers like Eli Lilly (LLY - Free Report) and J&J (JNJ - Free Report) .
AbbVie’s dividend yield of 3.16% is lower than MRK’s 3.89%.
Image Source: Zacks Investment Research
AbbVie’s return on equity of 699.7% is significantly higher than Merck’s 41.1%
Merck has one of the world’s best-selling drugs in its portfolio, generating billions of dollars in revenues. Though Keytruda will lose patent exclusivity in 2028, its sales are expected to remain strong until then. After a weak sales performance in the first half, Merck expects to return to growth in the second half. It expects growth to be driven by oncology drugs, Animal Health, as well as new products, which will be partially offset by lower sales of Gardasil. However, the company’s problems are too many at present, which is reflected in its declining stock price and estimates for 2026.
On the other hand, AbbVie has faced its biggest challenge — Humira’s patent cliff — quite well and looks well-positioned for continued strong growth in the years ahead. AbbVie is returning to robust revenue growth in 2025, which is just the second year following the U.S. Humira LOE, driven by its ex-Humira platform. Sales of AbbVie’s ex-Humira drugs rose more than 22% (on a reported basis) in the quarter, driven by Skyrizi, Rinvoq and neuroscience drugs.
Boosted by its new product launches, AbbVie expects to return to mid-single-digit revenue growth in 2025 with a high single-digit CAGR through 2029, as the company has no significant LOE events for the rest of this decade. With no significant LOEs in this decade, AbbVie enjoys the flexibility to invest more in R&D to continue to acquire external innovation.
Despite its steeper valuation, AbbVie is a clear-cut winner due to rising estimates, stock price appreciation, a solid pipeline and the prospect of further growth in sales and profits in the second half of 2025.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ABBV or MRK: Which Stock Should Investors Place Their Bet on in 2025?
Key Takeaways
Merck (MRK - Free Report) and AbbVie (ABBV - Free Report) are prominent pharmaceutical companies with strong positions in oncology and immunology.
AbbVie also operates in aesthetics, neuroscience and eye care, while Merck has a broader focus that includes vaccines, neuroscience, diabetes, virology and animal health.
Oncology drives more than 60% of Merck’s total revenues, with its blockbuster cancer drug Keytruda contributing around 50% of pharmaceutical sales.
For AbbVie, immunology is the largest segment, led by key therapies like Humira, Skyrizi and Rinvoq, which together make up roughly half of its total revenues.
Both companies are experiencing steady sales and earnings growth and have strong pipelines with late-stage candidates. But which offers the better investment opportunity? A closer examination of their fundamentals, growth outlook and risks is needed to decide.
The Case for AbbVie
AbbVie has successfully navigated the loss of exclusivity (LOE) of its blockbuster drug, Humira, which once generated more than 50% of its total revenues. It has accomplished this by launching two other successful new immunology medicines, Skyrizi and Rinvoq, which are performing extremely well, bolstered by approvals in new indications, and should support top-line growth in the next few years.
Skyrizi and Rinvoq generated combined sales of $11.6 billion in the first half of 2025. Skyrizi sales are now annualizing at almost $18 billion and Rinvoq at over $8 billion. AbbVie expects combined sales of Skyrizi and Rinvoq to be more than $25 billion in 2025 and more than $31 billion by 2027.
AbbVie’s oncology and neuroscience drugs are also contributing to top-line growth. AbbVie’s oncology segment generated combined revenues of $3.3 billion in the first half of 2025, up 4.2% year over year as higher sales of Venclexta and contributions from new drugs, Elahere and Epkinly, more than offset declining Imbruvica sales due to competitive pressure. Sales of its neuroscience drugs increased 20.3% to almost $5 billion in the first half of 2025, driven by higher sales of Botox Therapeutic, depression drug Vraylar and newer migraine drugs Ubrelvy and Qulipta.
AbbVie has been on an acquisition spree in the past couple of years to bolster the early-stage pipeline that should drive long-term growth. Particularly, it is signing several M&A deals in the immunology space, its core area, while also signing some early-stage deals in oncology and neuroscience areas. AbbVie has executed more than 30 M&A transactions since the beginning of 2024.
However, the company faces some near-term headwinds like Humira’s biosimilar erosion, increasing competitive pressure on cancer drug Imbruvica and a slow market growth trend for Juvederm fillers in the United States and China due to challenging market conditions and weakened consumer sentiment.
As of June 30, 2025, AbbVie had $63.0 billion in long-term debt and short-term debt/obligations of $7.5 billion on its balance sheet. Cash and cash equivalents totaled approximately $6.5 billion. Its debt-to-capital ratio of 1.02 is much higher than the industry's average of 0.42.
The Case for MRK
Merck boasts more than six blockbuster drugs in its portfolio, with Keytruda being the key top-line driver. Keytruda has played an instrumental role in driving Merck’s steady revenue growth in the past few years. Keytruda’s sales are gaining from rapid uptake across earlier-stage indications, mainly early-stage non-small cell lung cancer. Continued strong momentum in metastatic indications is also boosting sales growth. Keytruda’s sales rose around 7% in the first half of 2025.
The company expects continued growth from Keytruda, particularly in early lung cancer. Merck is also developing a subcutaneous formulation of Keytruda that can extend its patent life. Merck is working on different strategies to drive Keytruda's long-term growth, with the drug expected to lose patent exclusivity in 2028.
Merck’s Animal Health business is a key contributor to its top-line growth, as Merck is recording above-market growth.
Merck has been making meaningful regulatory and clinical progress. MRK’s phase III pipeline has almost tripled since 2021, supported by in-house pipeline progress as well as the addition of candidates through M&A deals. This has positioned Merck to launch around 20 new vaccines and drugs over the next few years, with many having blockbuster potential. These include Merck’s new 21-valent pneumococcal conjugate vaccine, Capvaxive, and pulmonary arterial hypertension drug, Winrevair, which have the potential to generate significant revenues over the long term. Both products have witnessed a strong launch.
In July 2025, Merck announced a new multi-year optimization initiative, which is expected to save $3 billion in annual costs by the end of 2027.
However, Merck faces several challenges. Sales of Gardasil, Merck’s second-largest product, declined 48% in the first half of 2025. Sales of Gardasil are declining due to weak performance in China, which resulted from sluggish demand trends amid an economic slowdown. Gardasil sales are expected to decline significantly in 2025 from 2024 levels. The company is also seeing lower demand for the vaccine in Japan. Sales are expected to remain weak in Japan in the second half of 2025.
Sales of some other Merck vaccines, like Proquad, M-M-R II, Varivax, Rotateq and Pneumovax 23, also declined in the second quarter.
MRK is also seeing declining demand for its diabetes products and generic erosion of some drugs.
Though Keytruda may be Merck’s biggest strength and a solid reason to own the stock, it can also be argued that the company is excessively dependent on the drug, and it should look for ways to diversify its product lineup.
There are rising concerns about the firm’s ability to grow its non-oncology business ahead of the upcoming LOE of Keytruda in 2028.
It exited the second quarter with cash and cash equivalents of $8.6 billion against total debt (short + long term) of $35.4 billion, resulting in a debt-to-capital ratio of 0.41, which is just slightly lower than the industry's average of 0.42.
How Do Estimates Compare for ABBV & MRK?
The Zacks Consensus Estimate for ABBV’s 2025 sales and EPS implies a year-over-year increase of 7.5% and 18.9%, respectively. EPS estimates for both 2025 and 2026 have risen over the past 30 days.
ABBV Estimate Movement
The Zacks Consensus Estimate for Merck’s 2025 sales and EPS implies a year-over-year increase of 1.2% and 16.7%, respectively. Estimates for MRK’s 2025 earnings have risen from $8.87 per share to $8.93 per share over the past 30 days, while those for 2026 have declined from $9.64 per share to $9.59 per share.
MRK Estimate Movement
Price Performance and Valuation of ABBV & MRK
Year to date, AbbVie’s stock has risen 20.3%, while Merck’s stock has plunged 14.8%. The industry has risen 1.4% in the said time frame.
ABBV is more expensive than MRK, going by the price/earnings ratio. AbbVie’s shares currently trade at 15.36 forward earnings, higher than 8.88 for Merck. AbbVie is also priced higher than 14.79 for the industry, while Merck is priced lower.
However, both Merck and AbbVie are cheaper than other large drugmakers like Eli Lilly (LLY - Free Report) and J&J (JNJ - Free Report) .
AbbVie’s dividend yield of 3.16% is lower than MRK’s 3.89%.
AbbVie’s return on equity of 699.7% is significantly higher than Merck’s 41.1%
ABBV vs. MRK: Which is a Better Pick?
Merck and AbbVie have a Zacks Rank #3 (Hold) each, which makes choosing one stock a difficult task. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Merck has one of the world’s best-selling drugs in its portfolio, generating billions of dollars in revenues. Though Keytruda will lose patent exclusivity in 2028, its sales are expected to remain strong until then. After a weak sales performance in the first half, Merck expects to return to growth in the second half. It expects growth to be driven by oncology drugs, Animal Health, as well as new products, which will be partially offset by lower sales of Gardasil. However, the company’s problems are too many at present, which is reflected in its declining stock price and estimates for 2026.
On the other hand, AbbVie has faced its biggest challenge — Humira’s patent cliff — quite well and looks well-positioned for continued strong growth in the years ahead. AbbVie is returning to robust revenue growth in 2025, which is just the second year following the U.S. Humira LOE, driven by its ex-Humira platform. Sales of AbbVie’s ex-Humira drugs rose more than 22% (on a reported basis) in the quarter, driven by Skyrizi, Rinvoq and neuroscience drugs.
Boosted by its new product launches, AbbVie expects to return to mid-single-digit revenue growth in 2025 with a high single-digit CAGR through 2029, as the company has no significant LOE events for the rest of this decade. With no significant LOEs in this decade, AbbVie enjoys the flexibility to invest more in R&D to continue to acquire external innovation.
Despite its steeper valuation, AbbVie is a clear-cut winner due to rising estimates, stock price appreciation, a solid pipeline and the prospect of further growth in sales and profits in the second half of 2025.