RGNX - AbbVie Q4 Earnings Preview: Few Clouds On Horizon Thanks To Masterful Management

2024-01-30 09:20:23 ET

Summary

• AbbVie Inc.'s revenues have fallen in 2023 due to the expiration of patents for its best-selling drug Humira, but the decline has not been as severe as expected.
• AbbVie's share price has grown by 11% in the past six months and over 110% in the past five years.
• The company recently provided raised guidance for earnings per share in 2023 and 2024, but overall revenues in both years are expected to be substantially lower than in 2022.
• The company will announce its Q4 2023 earnings this Friday. I am not expecting any major surprises - although the market may be pleasantly surprised as key divisions can have strong years.
• With a generous dividend and strong management, I doubt AbbVie will disappoint shareholders in 2024 - a necessary "trough" year.

Investment Overview

2023 had been telegraphed as a potential "annus horribilis" for the Illinois-based Big Pharma concern AbbVie Inc. ( ABBV ), as it was the year patents for its all-time best selling drug Humira expired in the U.S., allowing competing companies to launch generic versions of the autoimmune drug at substantial discounts of up to 85%.

As many as eight Humira biosimilars had been launched by the middle of 2023, and across the first three quarters of 2023, Humira revenues fell to $11.1bn, down ~30% year-on-year. Overall, across the same time period, AbbVie's total revenues fell 7% year-on-year, to $40bn. The company's net earnings fell 53%, to $2.26 per share, although on an adjusted basis, the figure was $8.32 - down ~18%....

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