AbbVie Earnings: Raising Our Fair Value Estimate With Significant Pipeline Progress

Key Morningstar Metrics for AbbVie

• Fair Value Estimate
  : $237.00
• Morningstar Rating
  : ★★
• Morningstar Economic Moat Rating
  : Wide
• Morningstar Uncertainty Rating
  : High

What We Thought of AbbVie’s Earnings

AbbVie’s ABBV revenue grew 10.3% in the third quarter. Management raised 2026 revenue guidance by $200 million to $67.8 billion and non-GAAP EPS guidance to $13.95-$13.99 (prior range of $13.76-$13.96). Shares rose 1% on Oct. 30.

Why it matters: AbbVie’s solid third-quarter performance and recent pipeline progress are very encouraging. Internal programs, supplemented by acquisitions like Apogee’s zumilokibart, should help the firm diversify its business and build on its strength in immunology.

• In immunology, Skyrizi (16% growth) remains AbbVie’s best-selling product, with the new subcutaneous starting dose further boosting efficacy and convenience in Crohn’s disease and minimal impact on psoriasis sales from J&J’s oral IL23 Icotyde so far.
• A phase 2b trial of Skyrizi, in combination with alpha-4-beta-7 and TL1A-targeting therapies, could support further improvements in efficacy in ulcerative colitis and Crohn’s disease, following a positive phase 2a readout from the Target-CD study for trosunilimab.

The bottom line: We’re raising our fair value estimate to $237 per share from $200 for wide-moat AbbVie after incorporating more credit for AbbVie’s deepening and advancing pipeline in immunology, oncology, and neuroscience. That said, shares still trade at a premium to our new valuation.

• We now explicitly model antibodies advancing into phase 2b in combination with Skyrizi in inflammatory bowel disease, including alpha-4 beta-7 antibody trosunilimab and TL1A antibody ABBV-701, which are now part of potential fixed-dose combination regimens.
• We think recent momentum around shares of pharma stocks has helped support valuations beyond their intrinsic values. Our 10-year revenue forecast for AbbVie is now slightly ahead of consensus, with sales reaching $94 billion in 2032 ahead of Skyrizi’s potential patent expiration.