AbbVie Inc. (ABBV) Fair Value & PE Analysis
Drug Manufacturers - General · NYSE
Current Price
$227.73
PE Ratio (TTM)
111.0x
Intrinsic Value
$140.53
-62.1% margin of safety
What Is AbbVie Inc.'s Fair Value?
As of 2026-06-12, applying a 50.0x earnings multiple to AbbVie Inc.'s (ABBV) earnings per share of $2.05 yields a fair value estimate of $140.53 per share, versus a market price of $227.73.
Fair value from earnings multiples is sensitive to the multiple you choose. Across the sensitivity grid the estimate spans $122.03 to $161.17. This is a relative estimate anchored to earnings, not a statement of fact. For a cash flow based view, see the intrinsic value estimate on the DCF page.
How our PE model works · Recalculate in PE mode · ABBV intrinsic value (DCF view)
Is AbbVie Inc. (ABBV) Overvalued?
At $227.73, ABBV trades above its PE-based fair value estimate, meaning the market pays a premium over the applied earnings multiple. By this model the stock looks expensive unless earnings grow into the price.
COMPETITIVE MOAT
↑Humira Legacy & Diversification
AbbVie successfully navigated Humira's patent cliff by diversifying its portfolio. This strategic shift, driven by acquisitions and internal R&D, mitigates reliance on a single blockbuster drug.
↑Oncology ADC Pipeline
The recent Decnupaz approval validates AbbVie's Antibody-Drug Conjugate (ADC) strategy in oncology. This expansion into targeted cancer therapies, built on deals and internal innovation, strengthens its future growth prospects.
↑Strong Cash Flow Generation
AbbVie has a history of delivering substantial returns, significantly outperforming the S&P 500. This consistent financial strength supports ongoing investment in research and development.
INVESTMENT RISKS
↓Pipeline Execution Risk
While the ADC strategy shows promise, future pipeline successes are not guaranteed. Delays or failures in clinical trials could impact revenue growth and market position.
↓Pricing Pressures & Regulation
The UK's recommendation for Elahere highlights ongoing scrutiny of drug pricing. AbbVie faces continued pressure from cost-effectiveness watchdogs and potential regulatory changes globally.
↓Competition in Key Therapeutic Areas
The pharmaceutical landscape is highly competitive. AbbVie faces rivals in its core areas, including oncology and immunology, which could erode market share.
Base case
ABBV base case PE valuation
Intrinsic Value
$140.53
Margin of safety
-62.1%
Expected annual return
-9.2%
Base case assumptions: 15.1% annual earnings growth, 50x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the ABBV PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for AbbVie Inc. respond.
Open PE Calculator for ABBVCompany Overview
AbbVie Inc. is a global biopharmaceutical company dedicated to the discovery, development, manufacturing, and commercialization of advanced medicines. Its extensive therapeutic portfolio encompasses several key areas: Immunology and Inflammation: Leading products include HUMIRA, an injectable therapy for autoimmune and intestinal Behçet's diseases; SKYRIZI, which addresses moderate to severe plaque psoriasis in adults; and RINVOQ, a JAK inhibitor for moderate to severe active rheumatoid arthritis in adult patients. Oncology and Hematology: For blood cancers, AbbVie provides IMBRUVICA and VENCLEXTA (a BCL-2 inhibitor), both indicated for adult patients with chronic lymphocytic leukemia (CLL) and small lymphocytic lymphoma (SLL). Virology: MAVYRET offers a treatment option for individuals with chronic HCV genotype 1-6 infection. Gastroenterology and Endocrinology: The company supplies CREON, an enzyme replacement therapy for exocrine pancreatic insufficiency, and Synthroid, used to manage hypothyroidism. Linzess/Constella helps treat irritable bowel syndrome with constipation (IBS-C) and chronic idiopathic constipation. Women's Health and Urology: Lupron serves as a palliative treatment for conditions like advanced prostate cancer, endometriosis, central precocious puberty, and anemia caused by uterine fibroids. ORILISSA, a nonpeptide small molecule GnRH antagonist, is designed for women experiencing moderate to severe endometriosis pain. Neurology: AbbVie offers Duopa and Duodopa, a levodopa-carbidopa intestinal gel for Parkinson's disease, and Ubrelvy to treat migraines (with or without aura) in adults. The therapeutic formulation of Botox is also part of its offerings. Ophthalmology: Its eye care segment features Lumigan/Ganfort (a bimatoprost ophthalmic solution) and Alphagan/Combigan (an alpha-adrenergic receptor agonist), both aimed at reducing elevated intraocular pressure (IOP) in patients with open-angle glaucoma (OAG) or ocular hypertension. Restasis, a calcineurin inhibitor immunosuppressant, is provided to enhance tear production, alongside other specialized eye care products. AbbVie Inc. also engages in research collaborations, including a partnership with Dragonfly Therapeutics, Inc. The company was founded in 2012 and operates from its headquarters in North Chicago, Illinois.
Financial Metrics — ABBV PE Stock Valuation Data
PE Ratio (TTM)
111.0x
PEG Ratio
n/m
Earnings Yield
0.90%
ROE (TTM)
68.0%
Revenue/Share (TTM)
$35.41
Dividend Yield
2.96%
Debt/Equity
2.65x
Frequently Asked Questions
What is the PE ratio of ABBV?
The trailing twelve-month PE ratio of ABBV reflects how much investors pay per dollar of AbbVie Inc.'s earnings. This metric is most useful when compared to Drug Manufacturers - General peers and the company's own historical range.
Is ABBV overvalued based on PE ratio?
ABBV's PE of 111.0x combined with a PEG ratio of -8.42 provides a growth-adjusted perspective. ABBV has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Drug Manufacturers - General, a DCF analysis may be more appropriate.
How do I value ABBV stock using PE ratio?
To value AbbVie Inc. using PE: (1) Compare the current PE (111.0x) against the Drug Manufacturers - General median to assess relative pricing, (2) check the PEG ratio (-8.42) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of ABBV?
ABBV's PEG ratio is -8.42, calculated by dividing the PE ratio (111.0x) by the expected earnings growth rate. Because ABBV has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for ABBV stock valuation?
PE ratio gives a quick relative read — how ABBV is priced versus Drug Manufacturers - General peers. DCF provides an absolute value based on projected free cash flows. For ABBV, with a strong ROE of 68.0%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See ABBV DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Healthcare valuationsP/E and DCF value ABBV with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.