AbbVie Inc. (ABBV, Financial) closed fourth-quarter 2016 reporting EPS of $1.20, 0.82% lower than third-quarter 2016 EPS of $1.21 and 6.2% higher than fourth-quarter 2015.
The biopharmaceutical company, which was spun off of Abbott Laboratories (ABT, Financial) in 2013, beat analysts’ expectations on adjusted EPS by one cent and generated a positive surprise of 5.3%.
For the quarter, AbbVie reported revenue of $6.8 billion, a 6.9% increase on a year-over-year basis. It missed expectations by $120 million.
AbbVie’s revenue is driven by the sale of Humira, the trade name under which adalimumab is marketed. Humira is the company's flagship product. More than 60% of its total net revenues are generated from the sale of this medication.
The company closed its fourth quarter reporting Humira sales of $4,292, a 15.5% increase on a year-over-year basis and an increase of 5.71% from the previous quarter of 2016. In the fourth quarter, Humira sales represented approximately 63.23% of AbbVie’s total revenues. According to the company, growth was “driven by continued momentum across all three major market categories – rheumatology, dermatology and gastroenterology.”
Since Humira is the company's best-selling product, several patents that preserve its position are crucial to AbbVie's profitability. Although the main patent covering Humira’s U.S. sales expired last year, shareholders should not be concerned. The company should be able to protect itself from competition due to Humira's established presence and several other factors discussed in a previous article.
AbbVie also reported quarterly sales for its other key products.
- Viekira Pak: $311 million, down 43.9%
- Lupron: $219 million, down 6.8%Â
- Synagis: $270 million, up 1.5%Â
- Imbruvica: $511 million, up 49.0%
The company pays a dividend of $2.56 through quarterly payments of 64 cents. The dividend yield is 4.23%.
AbbVie provided guidance for 2017 EPS. The company forecasts EPS will be between $4.55 and $4.65; non-GAAP EPS will be between $5.44 and $5.54.
AbbVie is trading around $59.71 per share with a price-book (P/B) ratio of 15.06 and a price-sales ratio of 3.86.
Disclosure: I have no positions in any stock mentioned in this article.
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