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AbbVie Inc.

Data period: Annual Quarterly Graham uses annual
NYSE · Healthcare
AbbVie Inc.
ABBV · Drug Manufacturers - General
$216.49
▼ -4.74 (-2.14%)
Cached · 10 min
Overall Grade
D
Defensive
C
Enterprising
Profitability
B
Gross Profit Margin 71.9%
Operating Margin 31.6%
Net Income Margin 4.6%
Fin. Health
F
Years to Pay Off Debt 104.8 yrs
Working Capital vs Long-Term Debt -$73.1B
Working Capital -$8.6B
Valuation
D
Price-to-Book N/A (neg. equity)
Cash Flow
B
Free Cash Flow $3.6B
CapEx % of Net Income 38.1%
Owner Earnings $2.9B
About AbbVie Inc.
AbbVie Inc., a research-based biopharmaceutical company, engages in the research and development, manufacturing, commercializing, and sale of medicines and therapies worldwide. The company offers Skyrizi to treat autoimmune diseases; Rinvoq to treat inflammatory diseases; Imbruvica for the treatment of adult patients with blood cancers; Venclexta to treat blood cancers; Elahere to treat various cancer; and Epkinly to treat lymphoma; and Emrelis for the treatment of lung cancer. It also provides facial injectables, plastics and regenerative medicine, body contouring, and skincare products; botox Cosmetic for the treatment of glabellar lines, crow's feet, forehead lines, and platysma bands; Juvederm Collection to treat volume loss in the temples, undereye, cheeks, chin, lips and lower face; Vraylar to treat schizophrenia, bipolar disorder, and depressive disorder; Duodopa to treat Parkinson's disease; Ubrelvy to treat migraine; Qulipta for episodic and chronic migraine; and Vyalev for the treatment of motor fluctuations, as well as Botox Therapeutic to treat chronic migraine, overactive bladder, spasticity, cervical dystonia, and other conditions. In addition, the company offers Ozurdex for visual impairment; Lumigan/Ganfort and Alphagan/Combigan for the reduction of elevated intraocular pressure in patients with open angle glaucoma or ocular hypertension; and other eye care products, including Refresh/Optive, Xen, Durysta, and Restasis. Further, it provides Mavyret to treat chronic hepatitis C virus genotype 1-6 infection; Creon, a pancreatic enzyme therapy; and Linzess/Constella to treat irritable bowel syndrome with constipation and chronic idiopathic constipation. The company was incorporated in 2012 and is headquartered in North Chicago, Illinois.
Metric Explanations
What each dimension measures and where the thresholds come from.
Gross Profit Margin
Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Years to Pay Off Debt
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital vs Long-Term Debt
Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Price-to-Book
Negative book value means total liabilities exceed total assets on the balance sheet. Two very different causes: (1) Heavy buybacks and dividends in highly profitable companies (Apple, McDonald's, Domino's) — equity deliberately reduced, not a warning sign. (2) Accumulated losses in unprofitable companies (Peloton, WeWork) — a genuine red flag. Check profitability and free cash flow to distinguish between the two. P/B cannot be scored meaningfully here.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Market Cap $382.5B
Enterprise Value $456.6B
P/E (TTM) 105.60
Dividend Yield 3.05%
Exchange NYSE
Gross Profit 71.9%
Operating Margin 31.6%
Net Margin 4.6%
Sector Healthcare
Industry Drug Manufacturers - General
Employees 57000
Country United States
📖
Full Graham Analysis

Mr. Market is currently offering AbbVie Inc. at $216.49.

The business passes only 2 of 7 of Graham's defensive criteria — well below his required standard.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.

Showing Key Metrics
Income Highlights
Metric Q1 2026 Q4 2025 Q4 2024
Gross Profit % 71.9% 72.6% N/A
Operating Margin % 31.6% 35.0% N/A
Net Income % 4.6% 10.9% N/A
Diluted EPS 0.39 1.02 N/A
Balance Sheet Highlights
Metric Q1 2026 Q4 2025 Q4 2024
Total Assets $136.5B $134.0B N/A
Total Debt $72.9B $67.5B N/A
Working Capital -$8.6B -$14.2B N/A
Years to Pay Debt 104.83 37.17 N/A
Cash Flow Highlights
Metric Q1 2026 Q4 2025 Q4 2024
Free Cash Flow $3.6B $4.9B N/A
Owner Earnings $2.9B $4.1B N/A
CapEx % of Net Income 38.1% 18.1% N/A
📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.
Quarter vs Same Quarter Last Year
YoY strips seasonality
Revenue Growth (YoY)
Prior year: $13.3B ▲ $15.0B +12.4%
Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.
Gross Margin
Prior year: 70.0% ▲ 71.9% +1.9pp
Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.
Operating Margin
Prior year: 35.5% ▲ 31.6% -3.9pp
Graham: operating margin reflects true business economics before financing. Trend matters as much as level.
Net Margin
Prior year: 9.6% ▼ 4.6% -5.0pp
Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.
Quarterly Health Checks
3 Graham/Buffett criteria that are valid and reliable on quarterly data
✅ Adequate Size
Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.
$15.0B/qtr (≈$60.0B ann.)
vs > $1.5B annualised revenue
❌ Financial Condition
Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.
0.80x current ratio
vs ≥ 2.0x
✅ Free Cash Flow
Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.
$3.6B
vs Positive
Operating Cash Flow
$3.8B
Latest quarter · Buffett's cash reality check
ROIC
4.0%
Based on latest annual operating income
Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.
Market Cap / Net Assets
⚠ Negative Net Assets
Net Assets: -$6.6B
⚠ Negative Net Assets — total liabilities exceed total assets on paper. This is common in companies that aggressively return capital via buybacks and dividends (Apple, McDonald's, Domino's). It does not indicate insolvency if the business generates strong, consistent free cash flow. Focus on FCF and earnings power rather than balance sheet book value for these companies.
⚠️ Net margin compressed 5.0pp vs same quarter last year. Common causes: one-time charges (restructuring, write-downs, legal settlements), tax rate changes, or rising interest expense. Check the income statement notes before drawing conclusions about operating health.
⚠️ Revenue grew vs prior year but operating margin contracted. Possible explanations: deliberate investment in growth (hiring, marketing, R&D), input cost inflation, or pricing pressure from competition. Buffett distinguishes between spending that builds moat vs. spending that doesn't.
Peers & Industry
No auto-detected peers for Drug Manufacturers - General. You can manually compare ABBV against any stock using the Compare tool.
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
Capital Allocation & Alignment
Insider Ownership
0.11%
Low — management has little skin in the game
Return on Assets (ROA)
0.5%
Poor — assets are not generating adequate returns
Share Buybacks (Latest Year)
$980M
Management is returning capital to shareholders via buybacks
Debt Trend YoY
+7.9% YoY
Debt is roughly stable
Leadership Team
Robert Michael CPA
CEO & Chairman of the Board
Age 55
Pay: $7,416,293
1.067% of net income
Scott Reents
Executive VP & CFO
Age 57
Pay: $3,946,913
0.568% of net income
Azita Saleki-Gerhardt Ph.
Executive VP & COO
Age 62
Pay: $4,072,891
0.586% of net income
Elizabeth Shea
Senior Vice President of Investor Relations
Wulff-Erik von Borcke
Senior VP & President of Oncology
Top Institutional Holders
Institution % Owned Shares
Blackrock Inc. 8.53% 150,698,125
Vanguard Capital Management LLC 6.50% 114,880,324
State Street Corporation 4.60% 81,217,516
JPMORGAN CHASE & CO 3.21% 56,741,691
Vanguard Portfolio Management LLC 2.80% 49,523,078
Geode Capital Management, LLC 2.65% 46,737,581
Morgan Stanley 2.15% 38,016,774
Capital Research Global Investors 1.77% 31,254,786
⚠️ Current ratio below 1 — liquidity risk
Risk Analysis
Beta (Market Risk)
0.31
Low volatility — more stable than the market
Short Interest
1.5% of float
Low short interest — market is not heavily bearish
Current Ratio
0.80x
Weak liquidity — current liabilities exceed current assets
52-Week Price Range
Low: $181.73 Current: $216.49 High: $244.81
Currently at 55% of 52-week range

AbbVie Inc. (ABBV) fundamental analysis — Overall grade D based on profitability, financial health, valuation and cash flow. Graham's Fair Value: N/A. Gross profit margin: 71.9%. Operating margin: 31.6%. Net margin: 4.6%. Market cap: $382.5B. Sector: Healthcare. Industry: Drug Manufacturers - General. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett principles.

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