AbbVie Inc
🇺🇸 ABBV · NYSE/NASDAQ · US00287Y1091
Healthcare
USD 208.84 price at analysis
Scores
Key Metrics
Powered by EODHDP/E (TTM)
88.5
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Calculation: 208.84 ÷ 2.36 = 88.5
TTM period through: 2025-12-31
Forward P/E (estimated): 14.8
Based on analyst estimates
Reference: Provider P/E (Trailing): 88.5
Yield (Fwd)
3.31%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Trailing Yield (TTM): 3.09%
Net Debt/EBITDA (TTM)
2.3x
Latest quarter: 4.0x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
TTM through: 2025-12-31
Latest quarter (2025-12-31): 4.0x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
Payout (Fwd)
293.2%
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Payout (TTM): 275.8%
Cash Flow Payout (TTM): 61.3%
FCF Coverage (TTM): 1.53x
ROE
62.3%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
25.1x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
Summary
AbbVie is a premier global biopharmaceutical leader with a robust track record of dividend growth and successful pipeline execution. While recent non-cash accounting impairments have severely distorted trailing earnings, underlying free cash flow strongly covers the secure 3.09% dividend yield. Existing shareholders should maintain positions, but current valuations offer limited upside for new investors to initiate positions.
Sector Context
AbbVie is a global biopharmaceutical company that develops and markets therapies across immunology, oncology, neuroscience, and aesthetics. In the context of dividend investing, major pharmaceutical companies often operate similarly to essential consumer staples, providing stable, recurring cash flows driven by continuous healthcare demand, though they require successful pipeline execution to navigate inevitable patent expirations on legacy drugs.
Temporary Opportunity Identified
A $3.5 billion non-cash intangible asset impairment charge and acquired IPR&D expenses caused a GAAP net loss in Q4 2024, severely inflating the trailing P/E ratio to 88.49x.
📊 Strategy Analysis
- • Underlying free cash flow remains highly robust, providing a safe 1.53x coverage ratio for the dividend (61.26% cash flow payout) despite GAAP earnings distortions.
- • A stellar 10-year dividend track record with a 13.4% CAGR and zero cuts demonstrates strong shareholder alignment and management quality.
- • Forward P/E of 14.77 presents a much more accurate reflection of the company's valuation and earning power compared to heavily skewed trailing metrics.
- • Net Debt/EBITDA has improved to a comfortable 2.26x, demonstrating consistent deleveraging from previous elevated levels.
⚠ What to Watch
- • Headline TTM P/E of 88.49x is severely distorted by a recent $3.5 billion non-cash intangible asset impairment charge, masking true profitability in automated screening.
- • Current price levels appear fully valued relative to forward earnings estimates, offering a limited margin of safety for new capital allocation.
- • The current dividend yield of 3.09% sits near the very bottom of the strategy's target range, offering limited immediate income advantage compared to higher-yielding alternatives.
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Dividend Sustainability (FCF vs Dividends Paid)
Free cash flowFree Cash Flow
Cash left after the company pays for running the business and maintaining it. Often used to fund dividends, pay debt, or buy back shares. (FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., blue) should cover dividends paidDividends Paid
Cash the company paid out to shareholders. It’s not guaranteed and can change over time. (green). If dividends consistently exceed FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., the dividend may be at risk.
Analysis date: 2026-04-04
Disclaimer: This information is for educational purposes only. Not financial advice.