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AbbVie (ABBV) to Report Q3 Earnings: What's in the Cards?

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AbbVie ABBV will report third-quarter 2021 results on Oct 29, before market open. In the last reported quarter, the company’s earnings met expectations.

AbbVie’s stock has gained 1.3% so far this year compared with an increase of 11.6% for the industry.

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Zacks Investment Research

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The large drugmaker’s performance has been pretty impressive, with its earnings beating estimates in three of the trailing four quarters and meeting the same once. The company has a four-quarter earnings surprise of 2.97%, on average.

Factors to Consider

Sales of the company’s key drugs are expected to have increased in the third quarter on the back of strong volumes on a recovery in demand for its products across franchises. However, some drugs might have faced a residual impact of the pandemic.

Third-quarter earnings are expected between $3.18 and $3.22 per share. AbbVie expects adjusted revenues of approximately $14.3 billion, indicating year-over-year growth of nearly 11%. The Zacks Consensus Estimate for earnings and revenues stands at $3.23 per share and $14.41 billion, respectively.

In immunology, Humira’s demand in the United States continues to witness strong demand trends. U.S. sales of the drug are likely to have increased in the third quarter. However, Humira’s international sales are expected to have declined significantly due to the impact of biosimilars in Europe. The Zacks Consensus Estimate for Humira stands at $5.26 billion.

Sales of new immunology drugs, Skyrizi and Rinvoq, reflected strong uptake during the last few quarters. The strong uptake is expected to have continued in the soon-to-be-reported quarter. The label expansion of Rinvoq in Europe to include atopic dermatitis and the launch of a single 150mg injection of Skyrizi for plaque psoriasis patients in August might have boosted sales of the drugs further during the quarter.

In September, the FDA ordered warnings about an increased risk of serious heart-related events, cancer, blood clots, and even death to be added on the label of all approved JAK inhibitors which include Rinvoq, following its review of safety data from a post-marketing study on Pfizer’s PFE Xeljanz. AbbVie may update on the impact of the FDA-requested label warnings for JAK inhibitors on the long-term prospects of Rinvoq.

In oncology, AbbVie markets Imbruvica in partnership with Johnson & Johnson JNJ and Venclexta with Roche. Sales of the drugs are likely to have been strong in the soon-to-be reported quarter. However, lower new patient starts in the chronic lymphocytic leukemia (CLL) indication for both Imbruvica and Venclexta due to the COVID-19 pandemic is likely to have hurt sales. The impact of increasing competition from newer therapies on Imbruvica sales remains to be seen. The Zacks Consensus Estimate for Imbruvica and Venclexta is pegged at $1.44 billion and $480 million, respectively.

Sales of AbbVie’s new Hepatitis C drug, Mavyret, started recovering from the pandemic impact during the second quarter. The recovery trend is likely to have continued in the third quarter, boosting sales of the drug. However, the pace of the recovery remains to be seen. The Zacks Consensus Estimate for Mavyret stands at $477 million.

Sales of AbbVie’s aesthetics products — Botox cosmetic and Juverderm — demonstrated a strong recovery trend during the second quarter of 2021, reflecting significant pent-up demand. Moreover, sales of the neuroscience franchise also showed strong growth in the first half of 2021. The trend is expected to have continued for both franchises in the soon-to-be-reported quarter. However, the impact of high infection rates due to the Delta variant remains to be seen. The Zacks Consensus Estimate for aesthetics and neuroscience products stands at $1.24 billion and $1.5 billion, respectively.

Investor focus will likely be on any update related to financial guidance for 2021 with the changing COVID-19 landscape.

Recent Developments

AbbVie received FDA approval for its first oral anti-CGRP drug, Qulipta, as a preventive treatment of migraine in September. In July, the company’s intravenous treatment, Dalvance, received approval as the first and only single-dose infusion to treat acute bacterial skin and skin structure infections in pediatric patients from birth. The company may discuss commercialization plans for these two drugs on its earnings call.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for AbbVie this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate of $3.22 per share and the Zacks Consensus Estimate of $3.23, is -0.26%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: AbbVie has a Zacks Rank #4 (Sell).

AbbVie Inc. Price and EPS Surprise

AbbVie Inc. Price and EPS Surprise
AbbVie Inc. Price and EPS Surprise

AbbVie Inc. price-eps-surprise | AbbVie Inc. Quote

Stock to Consider

Here is a large drug stock that has the right combination of elements to beat on earnings this time around:

Eli Lilly LLY has an Earnings ESP of +0.76% and a Zacks Rank #3. You can seethe complete list of today’s Zacks #1 Rank stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Johnson & Johnson (JNJ) : Free Stock Analysis Report

Pfizer Inc. (PFE) : Free Stock Analysis Report

Eli Lilly and Company (LLY) : Free Stock Analysis Report

AbbVie Inc. (ABBV) : Free Stock Analysis Report

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