Is AbbVie Inc. (ABBV) overvalued or undervalued?
Updated Nov 10, 2026 · hand-researched model · educational, not advice
At a recent price of $293.30, AbbVie Inc. (ABBV) trades 17% above TickerWorth's blended fair value of $251.37 per share — a discounted-cash-flow model cross-checked against peer multiples and asset value — meaning the market currently prices ABBV overvalued vs our estimate of what the business is intrinsically worth. Our fair value sits below the market, an implied -14.3% move to close the gap if the business performs in line with our assumptions. This is an educational model, not a price target or a recommendation — the value moves with the inputs, which you can test yourself using the WACC slider below.
One of the lenses behind that blended figure is a discounted-cash-flow model, which on its own values ABBV at about $344.25 per share. The rest of this page walks through that DCF — its assumptions, reverse-DCF and discount-rate sensitivity — because it is the auditable anchor of the blend.
The valuation discounts AbbVie Inc.'s projected free cash flows at a weighted-average cost of capital (WACC) of 6.9%, with a long-run terminal growth rate of 2.5%. About 83% of the enterprise value comes from the terminal value — the portion beyond the explicit forecast window — which is typical for a stable, cash-generative business and a reminder that small changes in the discount rate or terminal growth assumption swing the intrinsic value meaningfully.
Running the DCF in reverse — solving for the growth the current price already assumes — the market is implying roughly 5.7% annual revenue growth for ABBV. Our base case instead compounds to about 9.4% a year over the same forecast, so the market is pricing in slower growth than our base case. The reverse-DCF is a quick sanity check: it reframes 'is this stock cheap?' as 'do I believe the growth the price requires?' rather than arguing over a single point estimate of fair value.
Sensitivity matters more than any single number. Across a reasonable band of discount-rate assumptions, ABBV's modeled DCF value ranges from about $212.36 to $822.87 per share. If that range still sits below today's price, the market is optimistic relative to the model across the whole band; if it brackets the price, the stock is roughly fairly valued on our assumptions. Use the interactive slider to see exactly where your own cost-of-capital view lands.
How to read this page: the DCF fair value is what AbbVie Inc. would be worth if its cash flows grow as modeled and are discounted at the stated WACC. The assumptions table shows every input and its source; the reverse-DCF shows what the market believes; the sensitivity band shows how fragile the answer is. None of this is investment advice — it is a transparent, auditable framework for forming your own view of ABBV's intrinsic value. Figures update as new filings and prices come in.
The assumptions behind ABBV's DCF
| Input | Value | Source |
|---|---|---|
| Base-year revenue | $61,160,000,000 | FY2025 Form 10-K (filed 2026-02-20) — Consolidated Statements of Earnings and MD&A net-revenues-by-product table: Net revenues $61,160M, +8.6% on FY2024's $56,334M. By product (10-K MD&A, worldwide): Skyrizi $17,562M (+49.9%), Rinvoq $8,304M (+39.1%), Humira $4,540M (-49.5%) — the immunology trio is $30,406M, half the company; neuroscience $10,767M (Vraylar $3,621M, Botox Therapeutic $3,769M, Ubrelvy $1,271M, Qulipta $1,036M); oncology $6,655M (Imbruvica $2,869M, Venclexta $2,792M, Elahere $690M); aesthetics $4,860M (Botox Cosmetic $2,602M, Juvederm $993M); all other $6,512M. Skyrizi + Rinvoq together were $25,866M, 42.3% of revenue, and grew $7,689M in the year — more than the company's whole $4,826M revenue increase, because Humira lost $4,453M. That substitution is the spine of the forecast. |
| Base EBIT margin | 38.8% | Q4/FY2025 earnings release, 8-K Ex-99.1 (filed 2026-02-04) — GAAP-to-adjusted reconciliation, twelve months ended 2025-12-31; FY2025 Form 10-K Consolidated Statements of Earnings: DERIVED on AbbVie's own adjusted (non-GAAP) operating lines — the treatment this tracker applies to acquisition-built pharma (BMY, PFE, SNY), because AbbVie's GAAP operating earnings are not a run-rate: adjusted cost of products sold $9,802M, adjusted SG&A $13,636M, adjusted R&D $8,985M, less acquired IPR&D and milestones as filed, $5,016M: $61,160M - $9,802M - $13,636M - $8,985M - $5,016M = $23,721M = 38.79%. The adjusted lines exclude $7,377M of acquired-intangible amortization (a non-cash tail of the Allergan and earlier deals, sitting inside GAAP cost of products sold), $847M of intangible impairments (Resonic and Durysta) and $276M of acquisition/integration costs. GAAP operating earnings were $15,075M = 24.65%. TWO NUMBERS MATTER FOR THE FORECAST: before any IPR&D charge, the adjusted operating margin was 46.98% ($28,737M); the FY2025 IPR&D load actually incurred was 8.20 points of it. The forecast charges a normalized 5.5-point load instead of the actual (see forecast.ebit_margin). CROSS-CHECK, H1 2026 on the identical build (Q2 2026 release): $31,992M - $5,060M - $6,975M - $4,582M - $1,035M = $14,340M = 44.82%, with Q2 alone at 48.3% (the release's own adjusted operating margin), because the H1 IPR&D load was only 3.2 points. |
| Forecast revenue growth | 11% → 11% → 10% → 8% → 7% | Assumption — TickerWorth's 5-year explicit forecast |
| Risk-free rate | 5.2% | FRED DGS10 — 10-year US Treasury constant maturity yield: Shared house input: the same 5.24% used by every researched model in this tracker, held so values stay comparable across companies. The current FRED print is lower (4.96% on 2026-10-22, per the LLY model's check); refreshing it for AbbVie alone would break comparability — it is a tracker-wide update, flagged here rather than smuggled into one company's model. |
| Beta | 0.41 | Assumption — Yahoo Finance ABBV quote (delayed) — published beta; own regressions of ABBV on the S&P 500 from Yahoo dividend-adjusted price history: Measured here against the S&P 500 from Yahoo dividend-adjusted closes (log returns): 0.22 (5Y monthly), 0.05 (3Y monthly), 0.12 (2Y weekly), -0.68 (1Y weekly), 0.27 (2Y daily) — a median of 0.12. Published beta is ~0.24, consistent with the 5Y monthly window rather than the median. NORMALIZED UP to 0.41 with the standard Blume adjustment of the median (0.67 x 0.12 + 0.33 = 0.41), the same treatment this tracker applied to LLY (median 0.42 -> 0.61), BMY (0.184 -> 0.45), SNY (0.281 -> 0.52) and PFE (0.276 -> 0.52). CONSERVATIVE: it raises WACC and LOWERS the value — at the raw median of 0.12 the value is $502.14, about $158 a share higher (engine variant in the explainer). Reason: the measurement window is dominated by a company-specific event — the Humira loss of exclusivity and the Skyrizi/Rinvoq re-rating that replaced it — during which AbbVie rose largely on its own story while carrying $71B of debt and a two-molecule revenue concentration; a regression reads that as low correlation, not low risk. At the raw median the cost of equity would be 5.84%, barely above what AbbVie itself paid on new 30- and 40-year bonds in February 2026 (5.550% and 5.650%). The 1Y weekly window (-0.68) is the clearest illustration: the stock went up almost regardless of the market, which describes the last year, not the risk of the next ten. |
| Terminal growth | 2.5% | Assumption — House default — long-run nominal growth ceiling applied across the tracker: Shared house input (2.5%), identical in every researched model in this tracker. For AbbVie this is a real judgement, not a formality: the terminal year (2030) sits three years before the U.S. composition-of-matter patent expiry the 10-K gives for both Skyrizi and Rinvoq (2033; Rinvoq generic entry not expected before April 2037 under the September 2025 settlements), so 2.5% forever assumes AbbVie keeps replacing expiring waves the way Skyrizi and Rinvoq replaced Humira — and the business-development load charged inside the forecast margins is what pays for that replacement. |
| Diluted shares | 1,773M | Q2 2026 Form 10-Q (filed 2026-08-03) — Condensed Consolidated Statements of Earnings (weighted-average diluted shares) and cover page: Weighted-average DILUTED shares for the six months ended 2026-06-30: 1,773M (basic 1,769M; FY2025 diluted was also 1,773M — buybacks of $980M in FY2025 and $1,498M in H1 2026 roughly offset stock-compensation issuance). NO CENSUS BREAK IS NEEDED, and the reason is filed: AbbVie issued 1,844,174,521 shares at 2026-06-30, but 77,105,240 of them are held in treasury at cost ($10,618M contra-equity) — shares the company bought back, not shares held by any outsider — leaving 1,767,117,285 shares outstanding on the 10-Q cover at 2026-07-27. The diluted count (1,773M) is that census plus about 6M of dilutive securities. This is the opposite fact pattern from TSLA (an issued-but-unearned block held outside) and from LLY (a benefit-trust holding): here the house convention and the census agree to within 0.3% (dividing by 1,767.1M instead would print about $1 higher). |
| Market price | $293.30 | Delayed quote · as of 2026-11-10 05:33 UTC |
Compare ABBV with its peers
Companies people research alongside ABBV
Explore more
Most undervalued stocks (per our valuation) · Undervalued Healthcare stocks · All valued stocks · Interactive ABBV valuation & downloadable modelTickerWorth is an educational DCF tool, not a licensed investment adviser. Figures are estimates derived from public filings and market data and can be wrong.