ABBV: Future Returns Will Hinge On Post-Humira Immunology And Pipeline Execution

Analysts have nudged our AbbVie fair value estimate slightly higher, from $243.55 to $244.68. This reflects modestly stronger long term revenue growth expectations for key immunology franchises and pipeline assets, partially offset by slightly lower margin assumptions and a broadly constructive but mixed backdrop of recent price target revisions and rating changes across the Street.

Analyst Commentary

Street views on AbbVie remain broadly constructive, with a cluster of price target increases offset by a series of downgrades to Hold as investors reassess risk reward following the recent run in the shares and updated guidance.

Bullish Takeaways

Bullish analysts are raising price targets into the mid $240s to low $260s range, suggesting confidence that upside from core immunology and select pipeline assets is not fully reflected in the current valuation.
Recent Q3 outperformance and higher 2025 revenue and EPS guidance have reinforced the narrative that Skyrizi and Rinvoq can more than offset Humira erosion over time, supporting a durable high growth profile.
Improved visibility on intellectual property and generic settlement timelines, particularly around Rinvoq, is seen as extending the growth runway and reducing medium term cash flow risk assumptions.
Partnerships and optionality around external assets, such as those in ophthalmology and oncology, are increasingly viewed as underappreciated contributors to AbbVie’s longer term growth algorithm.

Bearish Takeaways

Bearish analysts shifting to Hold argue that the recent share price strength already discounts much of the normalized post Humira recovery, leaving a less compelling margin of safety versus updated price targets.
Concerns around a sizeable R&D write off and related guidance reduction have raised questions about capital allocation discipline and the execution risk embedded in AbbVie’s late stage pipeline.
Softness in aesthetics and the residual drag from legacy products are seen as potential headwinds to achieving the Street’s more optimistic margin and earnings trajectories.
Some neutral voices highlight ongoing policy and pricing uncertainty across large cap biopharma, which could limit multiple expansion even if AbbVie continues to deliver on its operational plan.

What's in the News

AbbVie is ending its decade long drug discovery partnership with Alphabet backed Calico Life Sciences, with associated layoffs among discovery chemists, signaling a strategic refocus of early stage R&D (STAT).
DZ Bank downgraded AbbVie shares to Hold from Buy, setting a $237 price target as it reassesses upside following the stock’s recent strength (DZ Bank).
AbbVie is part of a new pharma consortium, alongside Bristol Myers Squibb, Takeda and Astex, to pool protein small molecule structure data to train AI models aimed at improving drug discovery efficiency (Reuters).
OSE Immunotherapeutics amended its ABBV 230 collaboration so it now leads and funds preclinical and Phase 1 development, while AbbVie retains exclusive global rights and all downstream commercialization economics post Phase 1.
AbbVie reported an $847 million pre tax intangible asset impairment in the third quarter of 2025 and simultaneously announced a 5.5% increase in its quarterly dividend to $1.73 per share, starting with the February 2026 payment.

Valuation Changes

Fair Value Estimate has risen slightly, increasing from $243.55 to $244.68 per share.
Discount Rate has fallen marginally, moving from 7.32% to approximately 7.31%.
Revenue Growth has increased modestly, rising from about 8.09% to 8.21% in the long term forecast.
Net Profit Margin has slipped slightly, decreasing from roughly 29.81% to 29.73%.
Future P/E has ticked up modestly, moving from 23.77x to approximately 23.85x forward earnings.

Strong performance in immunology and neuroscience, supported by new product launches and expanding indications, helps offset losses from older drugs facing competition.
Strategic pipeline development, international growth, and operational efficiency position the company to sustain profitability and adapt to evolving industry trends.
Over-reliance on a few key drugs and therapeutic areas heightens risk from competition, regulatory changes, and underperformance in R&D or acquisitions, threatening earnings stability.

Catalysts

About AbbVie

A research-based biopharmaceutical company, engages in the research and development, manufacture, commercialization, and sale of medicines and therapies worldwide.

What are the underlying business or industry changes driving this perspective?

Continued robust growth in immunology from Skyrizi and Rinvoq, buoyed by expanded prescribing across multiple high-need indications like IBD and dermatology, and further supported by ongoing launches and indication expansions, is likely to drive sustained top-line revenue growth and mitigate the impact of Humira's LOE.
Advancements and strategic investments in neuroscience, including strong uptake of Vraylar, QULIPTA, Ubrelvy, and the emerging Parkinson's portfolio (e.g., VYALEV), align with growing demand for therapies addressing chronic neurological diseases in an aging population, supporting both revenue and long-term earnings stability.
AbbVie's diversified and expanding late-stage and early-stage pipeline, coupled with consistent business development activity (e.g., Capstan in vivo CAR-T, Gubra amylin analog for obesity, next-gen siRNA platforms), positions the company to capitalize on the increasing adoption of biologics and specialty pharmaceuticals, which can reinforce premium pricing and protect net margins.
International market expansion, evidenced by strong neuroscience launches and continued global share gains for Skyrizi and Rinvoq, provides opportunities for patient pool growth and revenue diversification as healthcare access broadens in emerging markets.
Operational efficiency initiatives and focused cost management-alongside high adjusted gross and operating margins-are likely to sustain or improve net margins even as global pricing pressures mount, driving healthy underlying earnings growth.

AbbVie Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming AbbVie's revenue will grow by 7.7% annually over the next 3 years.
Analysts assume that profit margins will increase from 6.4% today to 28.5% in 3 years time.
Analysts expect earnings to reach $20.8 billion (and earnings per share of $11.87) by about September 2028, up from $3.7 billion today. However, there is some disagreement amongst the analysts with the more bearish ones expecting earnings as low as $15.9 billion.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 22.5x on those 2028 earnings, down from 99.8x today. This future PE is greater than the current PE for the GB Biotechs industry at 15.3x.
Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
To value all of this in today's terms, we will use a discount rate of 6.98%, as per the Simply Wall St company report.

AbbVie Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Loss of exclusivity and patent expirations for major products like HUMIRA-and eventual competitive pressures on follow-on blockbusters like Skyrizi and Rinvoq-could result in significant revenue declines as biosimilar and generic competition intensifies and erodes pricing power, directly impacting AbbVie's top-line growth and future earnings.
Increasing global government focus on healthcare cost controls, drug price negotiations (such as the IRA in the US), and heightened regulatory scrutiny could lead to sustained pricing pressure, lower reimbursement rates, and rising compliance costs, putting downward pressure on net margins and earnings growth.
Heavy reliance on a concentrated product portfolio (mainly immunology and neuroscience platforms) makes AbbVie vulnerable to pipeline setbacks, unforeseen safety concerns, or competitor breakthroughs in those therapeutic areas, which could destabilize long-term revenue and earnings diversification.
Sustained weakness and volatility in the aesthetics business-driven by chronic macroeconomic headwinds, price-sensitive consumer trends, and shifting patient preferences-could limit recovery to historical growth rates and result in ongoing underperformance in that segment, negatively affecting revenue and margin contribution.
Elevated R&D and acquisition spending needed to maintain future pipeline momentum introduces financial risk: if new therapies or recent strategic acquisitions (e.g., Capstan, Gubra) underperform or integration falls short, AbbVie could face pressured net margins and reduced return on investment, challenging its ability to drive long-term earnings growth.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $216.483 for AbbVie based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $255.0, and the most bearish reporting a price target of just $170.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $73.0 billion, earnings will come to $20.8 billion, and it would be trading on a PE ratio of 22.5x, assuming you use a discount rate of 7.0%.
Given the current share price of $210.42, the analyst price target of $216.48 is 2.8% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Continued Expansion in Neuroscience and Immunology Will Drive Leadership Beyond 2025