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24800.0 | 2019-12-04 00:00:00 UTC | Here's Why Revance Therapeutics Stock Is Falling Today | ABBV | https://www.nasdaq.com/articles/heres-why-revance-therapeutics-stock-is-falling-today-2019-12-04 | nan | nan | What happened
Shares of Revance Therapeutics (NASDAQ: RVNC) are under pressure after management announced the pricing of a secondary offering. Investors dismayed by the pricing of the offering have hammered the biotech stock 16.4% lower as of 12:07 p.m. EST on Wednesday.
So what
Revance shares had been climbing since the company submitted an application to the FDA for DAXI late last month. On Monday, shares of Revance peaked above $20 per share and stayed there through the end of Tuesday's session, which is why investors were surprised at the $17 per share offering price announced today.
Image source: Getty Images.
DAXI is a longer-lasting version of the world's favorite neurotoxin, Botox, and Revance has evidence to prove it works better. That means Revance could end up competing with AbbVie (NYSE: ABBV) for a slice of Botox sales, which have risen to around $2.7 billion annually.
Now what
Within a couple of months, we'll know if the FDA will begin a review of DAXI that will probably last 10 months. Revance's collaboration partner, Mylan (NASDAQ: MYL), passed on the chance to fund late-stage development of DAXI in August and has until April 30, 2020, to change its mind.
If Mylan agrees to launch DAXI and give Revance a mid-double-digit royalty percentage on future sales, it could get much harder for AbbVie's acquisition of Allergan to deliver a positive return.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | That means Revance could end up competing with AbbVie (NYSE: ABBV) for a slice of Botox sales, which have risen to around $2.7 billion annually. If Mylan agrees to launch DAXI and give Revance a mid-double-digit royalty percentage on future sales, it could get much harder for AbbVie's acquisition of Allergan to deliver a positive return. Revance's collaboration partner, Mylan (NASDAQ: MYL), passed on the chance to fund late-stage development of DAXI in August and has until April 30, 2020, to change its mind. | That means Revance could end up competing with AbbVie (NYSE: ABBV) for a slice of Botox sales, which have risen to around $2.7 billion annually. If Mylan agrees to launch DAXI and give Revance a mid-double-digit royalty percentage on future sales, it could get much harder for AbbVie's acquisition of Allergan to deliver a positive return. On Monday, shares of Revance peaked above $20 per share and stayed there through the end of Tuesday's session, which is why investors were surprised at the $17 per share offering price announced today. | That means Revance could end up competing with AbbVie (NYSE: ABBV) for a slice of Botox sales, which have risen to around $2.7 billion annually. If Mylan agrees to launch DAXI and give Revance a mid-double-digit royalty percentage on future sales, it could get much harder for AbbVie's acquisition of Allergan to deliver a positive return. On Monday, shares of Revance peaked above $20 per share and stayed there through the end of Tuesday's session, which is why investors were surprised at the $17 per share offering price announced today. | That means Revance could end up competing with AbbVie (NYSE: ABBV) for a slice of Botox sales, which have risen to around $2.7 billion annually. If Mylan agrees to launch DAXI and give Revance a mid-double-digit royalty percentage on future sales, it could get much harder for AbbVie's acquisition of Allergan to deliver a positive return. On Monday, shares of Revance peaked above $20 per share and stayed there through the end of Tuesday's session, which is why investors were surprised at the $17 per share offering price announced today. |
24801.0 | 2019-12-03 00:00:00 UTC | Despite the Naysayers, AbbVie Keeps Marching On | ABBV | https://www.nasdaq.com/articles/despite-the-naysayers-abbvie-keeps-marching-on-2019-12-03 | nan | nan | AbbVie's (NYSE: ABBV) story in recent years is familiar to those who follow the pharmaceutical industry. The company's top-selling product (and the world's best-selling drug), Humira, helped catapult its shares upward after it split from Abbott Laboratories. However, with cheap biosimilars being introduced in Europe in late 2018, international sales of Humira are set to decline in the coming years. Further, since biosimilars will also be introduced in the U.S. market (Humira's largest market) by 2023, the future doesn't look particularly bright for this drug. These factors prompted AbbVie's shares to plunge by as much as 30% during the first half (or so) of the year.
But the company has rebounded nicely since August, and its shares are almost at the same level they were at the beginning of the year. In short, despite many predicting the demise of AbbVie, the company is still alive and well. Here's why.
AbbVie's third-quarter results
AbbVie released its third-quarter earnings report on Nov. 1, and the company's results were solid. AbbVie's revenue of $8.4 billion improved 3% year over year and came in ahead of the consensus analyst estimates. The company's bottom line, too, was better than expected; its adjusted earnings per share (EPS) was $2.33, slightly higher than the $2.30 Wall Street was gearing up for.
Sales of Humira declined slightly -- by 3.7% -- compared to the year-ago period, but that was despite the fact that revenue from AbbVie's top-selling product dropped by 33.5% internationally. In the U.S., Humira is maintaining its upward trajectory, increasing its sales by 9.7% year-over-year during the quarter. For now, the continued dominance of Humira in the U.S. is almost offsetting the decline of its sales in Europe, which is obviously good news for the company.
Image Source: Getty Images.
The Allergan deal isn't looking so bad
AbbVie's acquisition of Allergan (NYSE: AGN) in June was criticized for two major reasons. First, the price AbbVie paid seemed steep: The $63 billion price tag was a 45% premium over Allergan's share price at the time of the deal. Second, Allergan had been suffering from an overreliance on one product line, namely its Botox business. But now that the dust has largely settled, it seems that AbbVie stands to benefit from this acquisition.
In addition to its strong position in the immunology department thanks to Humira and newcomers Skyrizi and Rinvoq -- which have already racked up more than $100 million in sales after hitting the market earlier this year -- the company will inherit Allergan's products, including offerings in medical aesthetics, eye care, central nervous system (CNS), and gastroenterology. The days of AbbVie's reliance on Humira will be long gone, which at least partly explains the company's confidence in its decision to acquire Allergan.
AbbVie CEO Richard Gonzalez said, "With the planned acquisition of Allergan, we will be adding highly valuable on-market assets with leadership positions across additional and attractive growth segments including significant new growth platforms in medical aesthetics and CNS."
Better days ahead
With the continued dominance of Humira in the U.S. and AbbVie's acquisition of Allergan -- which will give it access to a much wider portfolio of products -- the company will likely see much better days ahead. AbbVie's reputation as a strong dividend growth stock only sweetens the deal for investors. That is why, despite its struggles this year, it would be a mistake to ignore the big pharma company.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Sales of Humira declined slightly -- by 3.7% -- compared to the year-ago period, but that was despite the fact that revenue from AbbVie's top-selling product dropped by 33.5% internationally. AbbVie's (NYSE: ABBV) story in recent years is familiar to those who follow the pharmaceutical industry. These factors prompted AbbVie's shares to plunge by as much as 30% during the first half (or so) of the year. | AbbVie's third-quarter results AbbVie released its third-quarter earnings report on Nov. 1, and the company's results were solid. The Allergan deal isn't looking so bad AbbVie's acquisition of Allergan (NYSE: AGN) in June was criticized for two major reasons. Better days ahead With the continued dominance of Humira in the U.S. and AbbVie's acquisition of Allergan -- which will give it access to a much wider portfolio of products -- the company will likely see much better days ahead. | AbbVie's third-quarter results AbbVie released its third-quarter earnings report on Nov. 1, and the company's results were solid. Better days ahead With the continued dominance of Humira in the U.S. and AbbVie's acquisition of Allergan -- which will give it access to a much wider portfolio of products -- the company will likely see much better days ahead. AbbVie's (NYSE: ABBV) story in recent years is familiar to those who follow the pharmaceutical industry. | Better days ahead With the continued dominance of Humira in the U.S. and AbbVie's acquisition of Allergan -- which will give it access to a much wider portfolio of products -- the company will likely see much better days ahead. AbbVie's (NYSE: ABBV) story in recent years is familiar to those who follow the pharmaceutical industry. These factors prompted AbbVie's shares to plunge by as much as 30% during the first half (or so) of the year. |
24802.0 | 2019-12-03 00:00:00 UTC | Merck Isn't Too Reliant on Keytruda Yet, and That's Good News for Investors | ABBV | https://www.nasdaq.com/articles/merck-isnt-too-reliant-on-keytruda-yet-and-thats-good-news-for-investors-2019-12-03 | nan | nan | Merck (NYSE: MRK) has performed well on the stock market this year. Since early January, the company's shares are up by about 15%, which compares favorably to the return provided by the pharmaceutical industry -- as measured by the SPDR S&P Pharmaceuticals Index -- which is up 10% year to date. The main reason behind Merck's performance has been none other than its blockbuster cancer medicine Keytruda. The company's top-selling product continues to spearhead its top-line growth, but there's something investors should appreciate: Merck's revenue isn't too reliant on Keytruda.
Keytruda will likely see even better days ahead
Merck released its third-quarter earnings report on Oct. 29. The company's sales were $12.4 billion, a 15% year-over-year increase, and Merck's non-GAAP earnings per share (EPS) improved by 27%. Most importantly, though, were the results from its oncology segment led by Keytruda. Sales of the cancer medicine were $3.1 billion, a 62% increase compared to the year-ago period. During the quarter, Keytruda made up about 25% of Merck's sales. It isn't unheard of for pharma companies to be much more reliant on their top-selling products than that. For example, AbbVie's Humira was responsible for about 58% of the company's sales during the third quarter.
Image Source: Getty Images.
There are two major reasons why Merck isn't too reliant on Keytruda yet. First, the company has other products to count on to drive its sales. Most notably, Merck's vaccines lineup -- which includes cancer prevention vaccines such as Gardasil and Gardasil 9 -- is performing well. During the second quarter, sales from the company's human health vaccines unit were $2.5 billion, a 17% year-over-year increase. Second, and perhaps most importantly, Merck still has a lot of room to grow.
Keytruda is currently being tested for treatment for a range of other cancers, including breast cancer, cervical cancer, and liver cancer, among many others. Thus, there are likely more approvals for Keytruda on the horizon. Case in point: Keytruda was also approved for the treatment of head and neck cancer in Europe recently. According to estimates, there were 146,000 new cases of these conditions in Europe in 2018, and 66,000 deaths resulted from them.
Further, Keytruda was approved for the treatment of lung cancer in China, where lung cancer is the leading cause of cancer death. There are almost 800,000 new cases of lung cancer diagnosed every year in the country, and about 631,000 deaths associated with it. In other words, Keytruda's market just expanded somewhat significantly, which should be beneficial both to those receiving treatment for these deadly diseases and for Merck.
Investors should take notice
Keytruda is projected to become the world's best-selling drug by 2024 as Humira faces stiff competition from biosimilars in Europe. The cancer medicine will likely continue on its upward trajectory and may eventually account for a much larger percentage of Merck's sales. With its top-selling product leading the way, Merck's future looks bright at the moment, and the pharma stock looks like a buy heading into 2020.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | For example, AbbVie's Humira was responsible for about 58% of the company's sales during the third quarter. The company's top-selling product continues to spearhead its top-line growth, but there's something investors should appreciate: Merck's revenue isn't too reliant on Keytruda. Investors should take notice Keytruda is projected to become the world's best-selling drug by 2024 as Humira faces stiff competition from biosimilars in Europe. | For example, AbbVie's Humira was responsible for about 58% of the company's sales during the third quarter. The company's sales were $12.4 billion, a 15% year-over-year increase, and Merck's non-GAAP earnings per share (EPS) improved by 27%. Most notably, Merck's vaccines lineup -- which includes cancer prevention vaccines such as Gardasil and Gardasil 9 -- is performing well. | For example, AbbVie's Humira was responsible for about 58% of the company's sales during the third quarter. The company's top-selling product continues to spearhead its top-line growth, but there's something investors should appreciate: Merck's revenue isn't too reliant on Keytruda. Keytruda is currently being tested for treatment for a range of other cancers, including breast cancer, cervical cancer, and liver cancer, among many others. | For example, AbbVie's Humira was responsible for about 58% of the company's sales during the third quarter. Merck (NYSE: MRK) has performed well on the stock market this year. The main reason behind Merck's performance has been none other than its blockbuster cancer medicine Keytruda. |
24803.0 | 2019-12-03 00:00:00 UTC | Insiders Buy the Holdings of MDIV ETF | ABBV | https://www.nasdaq.com/articles/insiders-buy-the-holdings-of-mdiv-etf-2019-12-03 | nan | nan | A look at the weighted underlying holdings of the Multi-Asset Diversified Income Index Fund (MDIV) shows an impressive 10.8% of holdings on a weighted basis have experienced insider buying within the past six months.
Energy Transfer LP (Symbol: ET), which makes up 0.80% of the Multi-Asset Diversified Income Index Fund (MDIV), has seen 3 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The ETF holds a total of $5,801,873 worth of ET, making it the #36 largest holding. The table below details the recent insider buying activity observed at ET:
ET — last trade: $11.63 — Recent Insider Buys:
And AbbVie Inc (Symbol: ABBV), the #45 largest holding among components of the Multi-Asset Diversified Income Index Fund (MDIV), shows 7 directors and officers as recently filing Form 4's indicating purchases. The ETF holds $5,434,476 worth of ABBV, which represents approximately 0.75% of the ETF's total assets at last check. The recent insider buying activity observed at ABBV is detailed in the table below:
ABBV — last trade: $87.03 — Recent Insider Buys:
10 ETFs With Stocks That Insiders Are Buying »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The table below details the recent insider buying activity observed at ET: ET — last trade: $11.63 — Recent Insider Buys: And AbbVie Inc (Symbol: ABBV), the #45 largest holding among components of the Multi-Asset Diversified Income Index Fund (MDIV), shows 7 directors and officers as recently filing Form 4's indicating purchases. The ETF holds $5,434,476 worth of ABBV, which represents approximately 0.75% of the ETF's total assets at last check. The recent insider buying activity observed at ABBV is detailed in the table below: ABBV — last trade: $87.03 — Recent Insider Buys: 10 ETFs With Stocks That Insiders Are Buying » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The table below details the recent insider buying activity observed at ET: ET — last trade: $11.63 — Recent Insider Buys: And AbbVie Inc (Symbol: ABBV), the #45 largest holding among components of the Multi-Asset Diversified Income Index Fund (MDIV), shows 7 directors and officers as recently filing Form 4's indicating purchases. The recent insider buying activity observed at ABBV is detailed in the table below: ABBV — last trade: $87.03 — Recent Insider Buys: 10 ETFs With Stocks That Insiders Are Buying » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The ETF holds $5,434,476 worth of ABBV, which represents approximately 0.75% of the ETF's total assets at last check. | The table below details the recent insider buying activity observed at ET: ET — last trade: $11.63 — Recent Insider Buys: And AbbVie Inc (Symbol: ABBV), the #45 largest holding among components of the Multi-Asset Diversified Income Index Fund (MDIV), shows 7 directors and officers as recently filing Form 4's indicating purchases. The recent insider buying activity observed at ABBV is detailed in the table below: ABBV — last trade: $87.03 — Recent Insider Buys: 10 ETFs With Stocks That Insiders Are Buying » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The ETF holds $5,434,476 worth of ABBV, which represents approximately 0.75% of the ETF's total assets at last check. | The table below details the recent insider buying activity observed at ET: ET — last trade: $11.63 — Recent Insider Buys: And AbbVie Inc (Symbol: ABBV), the #45 largest holding among components of the Multi-Asset Diversified Income Index Fund (MDIV), shows 7 directors and officers as recently filing Form 4's indicating purchases. The ETF holds $5,434,476 worth of ABBV, which represents approximately 0.75% of the ETF's total assets at last check. The recent insider buying activity observed at ABBV is detailed in the table below: ABBV — last trade: $87.03 — Recent Insider Buys: 10 ETFs With Stocks That Insiders Are Buying » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. |
24804.0 | 2019-12-03 00:00:00 UTC | 3 Words AbbVie Investors Really Didn't Want to Hear | ABBV | https://www.nasdaq.com/articles/3-words-abbvie-investors-really-didnt-want-to-hear-2019-12-03 | nan | nan | AbbVie (NYSE: ABBV) shareholders might not be exactly happy with the stock's performance in 2019. But they know it could be much worse. Only a few months ago, AbbVie was down more than 30% year to date. Since September, though, the big drugmaker has announced some positive pipeline news and delivered surprisingly positive third-quarter results.
But AbbVie received some unpleasant news last week in the form of an updated evidence report from the Institute for Clinical and Economic Review (ICER), an independent nonprofit group that evaluates the cost-effectiveness of healthcare treatments and tests. This ICER report contained three words that AbbVie investors really didn't want to hear: "marginal clinical benefit."
Image source: Getty Images.
Three troubling words
Why should those three words be so troubling? It helps to understand the context of ICER's report.
The organization's goal with this report was to analyze the cost-effectiveness of Eli Lilly's Olumiant, AbbVie's Rinvoq, and Pfizer's Xeljanz in treating rheumatoid arthritis (RA) compared to the current gold standard for RA -- AbbVie's Humira. ICER's findings for Olumiant and Xeljanz were especially tough, with the evidence report stating that "the evidence cannot demonstrate added effectiveness for tofacitinib [Xeljanz], and we found no evidence with which to compare baricitinib [Olumiant] to adalimumab [Humira]."
But the report also stated that Rinvoq "provides marginal clinical benefit in comparison to adalimumab [Humira], at higher costs." ICER's analysis found that AbbVie's new RA drug is only "modestly more effective" than the company's older RA drug.
This report appears to undermine to some extent AbbVie's previous claims that Rinvoq clearly outperforms Humira. In the company's third-quarter conference call, for example, AbbVie CEO Rick Gonzalez stated, "With the strong benefit-risk profile demonstrated across our registrational trials, Rinvoq offers meaningful advantages over products on the market today or in development for rheumatoid arthritis."
ICER originally released a draft evidence report in September that contained even worse news for Rinvoq. That report found that the incremental cost-effectiveness for Rinvoq compared to Humira failed to come in below ICER's $150,000 threshold. However, the organization subsequently changed some of the parameters used in its analysis, resulting in the evidence report released last week that was more favorable toward Rinvoq -- although still problematic in that it could present challenges for AbbVie.
Despite the ICER report's lukewarm verdict on Rinvoq, there is some good news. AbbVie's list price of $59,860 for the drug less standard rebates of around 25% come in between ICER's value-based price benchmark range of $44,000 and $45,000. This pricing should allow the company to gain traction with payers even though Rinvoq's benefit is only "marginal" over Humira based on ICER's analysis.
What's riding on Rinvoq
Any bumps in the road for Rinvoq could be significant for AbbVie because the company needs to replace sagging sales for Humira. The drug already faces biosimilar competition in Europe, where sales plunged 33% year over year in the third quarter.
However, AbbVie hasn't faced the big challenge for Humira yet. Biosimilars to the best-selling drug will hit the U.S. market beginning in 2023. It's this looming sales cliff that AbbVie hopes Rinvoq can help offset.
Industry expectations are high for Rinvoq. Market researcher Evaluate Pharma picked the drug as the No. 2 biggest new drug launch of 2019. AbbVie projects Rinvoq's peak sales will be in the ballpark of $6.5 billion as it picks up additional indications beyond RA.
AbbVie is also evaluating Rinvoq in late-stage studies targeting Crohn's disease, atopic dermatitis, psoriatic arthritis, giant cell arteritis, and ulcerative colitis. In addition, the company has a phase 2 clinical study under way evaluating the drug in treating axial spondyloarthritis.
Nicer than ICER
There are three words that should give AbbVie a level of comfort that ICER's report doesn't: AbbVie has more. In other words, the company's strategy to deal with the falling sales for Humira don't rely only on Rinvoq.
AbbVie's other recently approved immunology drug, Skyrizi, is also expected to be a huge blockbuster. The company's current blood cancer drugs, Imbruvica and Venclexta, continue to enjoy strong momentum. And AbbVie thinks that Orilissa could become a blockbuster in the future in treating endometriosis and uterine fibroids.
The company also plans to acquire Allergan. This pending transaction, when finalized, would significantly reduce AbbVie's dependence on Humira.
Perhaps the best three words of all related to AbbVie, though, are "5.4% dividend yield." AbbVie ranks among the best dividend stocks on the market right now. Investors would prefer that Rinvoq be viewed as a clearly better alternative than Humira. But they'll take the ICER report in stride, knowing that AbbVie's dividends will keep on flowing.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But AbbVie received some unpleasant news last week in the form of an updated evidence report from the Institute for Clinical and Economic Review (ICER), an independent nonprofit group that evaluates the cost-effectiveness of healthcare treatments and tests. In the company's third-quarter conference call, for example, AbbVie CEO Rick Gonzalez stated, "With the strong benefit-risk profile demonstrated across our registrational trials, Rinvoq offers meaningful advantages over products on the market today or in development for rheumatoid arthritis." AbbVie is also evaluating Rinvoq in late-stage studies targeting Crohn's disease, atopic dermatitis, psoriatic arthritis, giant cell arteritis, and ulcerative colitis. | This ICER report contained three words that AbbVie investors really didn't want to hear: "marginal clinical benefit." The organization's goal with this report was to analyze the cost-effectiveness of Eli Lilly's Olumiant, AbbVie's Rinvoq, and Pfizer's Xeljanz in treating rheumatoid arthritis (RA) compared to the current gold standard for RA -- AbbVie's Humira. AbbVie (NYSE: ABBV) shareholders might not be exactly happy with the stock's performance in 2019. | The organization's goal with this report was to analyze the cost-effectiveness of Eli Lilly's Olumiant, AbbVie's Rinvoq, and Pfizer's Xeljanz in treating rheumatoid arthritis (RA) compared to the current gold standard for RA -- AbbVie's Humira. ICER's analysis found that AbbVie's new RA drug is only "modestly more effective" than the company's older RA drug. Nicer than ICER There are three words that should give AbbVie a level of comfort that ICER's report doesn't: AbbVie has more. | This ICER report contained three words that AbbVie investors really didn't want to hear: "marginal clinical benefit." ICER's analysis found that AbbVie's new RA drug is only "modestly more effective" than the company's older RA drug. Nicer than ICER There are three words that should give AbbVie a level of comfort that ICER's report doesn't: AbbVie has more. |
24805.0 | 2019-12-01 00:00:00 UTC | 3 Top Biotech Stocks to Buy in December | ABBV | https://www.nasdaq.com/articles/3-top-biotech-stocks-to-buy-in-december-2019-12-01 | nan | nan | Will biotech stocks have a big year in 2020? I have no idea. But there are three stocks that I expect will deliver great returns over the long run and quite possibly will do so next year.
One's a dividend investor's dream. Another is a clinical-stage biotech that has plenty of big news on the way. And the third is arguably the best biotech stock on the market right now. Which stocks am I referring to? AbbVie (NYSE: ABBV), Axsome Therapeutics (NASDAQ: AXSM), and Vertex Pharmaceuticals (NASDAQ: VRTX).
Image source: Getty Images.
1. AbbVie
If you're looking for a stock with an absolutely mouthwatering dividend, look no further than AbbVie. Its dividend currently yields close to 5.4%. And AbbVie has boosted its dividend payout by a whopping 195% since becoming a standalone company in 2013.
No, AbbVie probably won't deliver earth-shattering growth anytime soon. Its top-selling drug, Humira, faces biosimilar competition in Europe already, with biosimilars hitting the U.S. market in 2023. However, AbbVie appears to have a pretty good strategy to reduce its dependence on Humira.
It already has a couple of blood cancer drugs generating strong sales growth with Imbruvica and Venclexta. New immunology drugs Rinvoq and Skyrizi ranked No. 2 and No. 3, respectively, on EvaluatePharma's list of the top new drug launches of 2019. AbbVie also thinks Orilissa will become a blockbuster in treating endometriosis and uterine fibroids.
The other key part of AbbVie's strategy to deal with Humira's decline is its pending acquisition of Allergan. This deal brings Allergan's crown jewel, Botox, along with other fast-growing drugs including Vraylar into AbbVie's lineup.
2. Axsome Therapeutics
Clinical-stage biotech stocks admittedly present an especially risky proposition for investors. But I think Axsome Therapeutics is worthy of consideration for those with aggressive investing styles. Axsome has skyrocketed more than 1,200% so far in 2019. To say investors are eagerly anticipating the biotech's upcoming clinical study updates is an understatement.
The company expects to report results from its late-stage study evaluating AXS-05 in treating major depressive disorder (MDD) by the end of 2019. Results from another late-stage study of the drug in treating treatment-resistant depression (TDD) should be announced in the first quarter of 2020. Axsome anticipates providing top-line results from a phase 2/3 study of AXS-05 in treating Alzheimer's disease agitation are anticipated in the first half of 2020.
Results from a late-stage study of AXS-07 in treating migraine are also expected by the end of this year. The biotech plans on announcing results from yet another late-stage study of AXS-12 in treating narcolepsy by the end of 2019 as well.
If you've been keeping count, that's four late-stage clinical trials for three different drugs plus a midstage study that combined target five indications. Analysts think AXS-05 could achieve peak annual sales of $1 billion or more if approved. Sure, there's a not-so-insignificant risk that Axsome's results could be disappointing. But a couple of key clinical wins could put this biotech on the path to deliver even greater gains.
3. Vertex Pharmaceuticals
It's hard to come up with something not to like about Vertex. The biotech's lineup includes four approved drugs that treat cystic fibrosis (CF). Three of them are already blockbusters.
The only CF drug from Vertex that isn't a blockbuster yet is Trikafta, which won U.S. Food and Drug Administration approval in October -- several months earlier than expected. It's only a matter of time before the drug eclipses the sales of all of the company's other drugs combined. As Trikafta wins regulatory approvals in other countries, it's expected to expand Vertex's addressable patient population by more than 50%.
Vertex is also looking to move into other indications. It's working with CRISPR Therapeutics on gene-editing therapy CTX001 in treating rare blood diseases beta-thalassemia and sickle cell disease. The company has a promising pain program that shouldn't be too far away from advancing to late-stage testing. Vertex also is evaluating candidates in early stage clinical trials targeting rare genetic diseases including alpha-1 antitrypsin deficiency.
Thanks to its tremendous success in CF, Vertex has amassed an impressive cash stockpile that it's using to make strategic acquisitions. The company's biggest deal so far is its recent acquisition of Semma Therapeutics for $950 million. Semma has a preclinical program focused on developing a cure for type 1 diabetes. I fully expect Vertex to reign as one of the most successful biotechs of the next decade with its strong CF franchise, promising pipeline, and ample cash to make additional key acquisitions.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (NYSE: ABBV), Axsome Therapeutics (NASDAQ: AXSM), and Vertex Pharmaceuticals (NASDAQ: VRTX). AbbVie If you're looking for a stock with an absolutely mouthwatering dividend, look no further than AbbVie. And AbbVie has boosted its dividend payout by a whopping 195% since becoming a standalone company in 2013. | AbbVie (NYSE: ABBV), Axsome Therapeutics (NASDAQ: AXSM), and Vertex Pharmaceuticals (NASDAQ: VRTX). AbbVie If you're looking for a stock with an absolutely mouthwatering dividend, look no further than AbbVie. And AbbVie has boosted its dividend payout by a whopping 195% since becoming a standalone company in 2013. | See the 10 stocks *Stock Advisor returns as of June 1, 2019 Keith Speights owns shares of AbbVie and Vertex Pharmaceuticals. AbbVie (NYSE: ABBV), Axsome Therapeutics (NASDAQ: AXSM), and Vertex Pharmaceuticals (NASDAQ: VRTX). AbbVie If you're looking for a stock with an absolutely mouthwatering dividend, look no further than AbbVie. | AbbVie If you're looking for a stock with an absolutely mouthwatering dividend, look no further than AbbVie. See the 10 stocks *Stock Advisor returns as of June 1, 2019 Keith Speights owns shares of AbbVie and Vertex Pharmaceuticals. AbbVie (NYSE: ABBV), Axsome Therapeutics (NASDAQ: AXSM), and Vertex Pharmaceuticals (NASDAQ: VRTX). |
24806.0 | 2019-11-27 00:00:00 UTC | Why AbbVie Is a Dividend Growth Stock That's Too Cheap to Ignore | ABBV | https://www.nasdaq.com/articles/why-abbvie-is-a-dividend-growth-stock-thats-too-cheap-to-ignore-2019-11-27 | nan | nan | AbbVie (NYSE: ABBV) and Abbott Laboratories (NYSE: ABT) were born of the same parent but separated at birth. In 2013, Abbott Laboratories split into two companies, one primarily a medical device maker (which retained the parent's name) and the other a pharmaceutical company. That's where the similarities end, however.
The siblings have since had very divergent paths -- at least in terms of their share prices. Whereas Abbott Labs has been steadily hitting new highs, AbbVie peaked in 2018 and has since fallen close to 30%.
For much of its history, AbbVie was the better horse to back than Abbott Labs. In the first five years after the spin-off, Abbvie rose over 200% while Abbott increased 78%.AbbVie's fortunes took a turn for the worse in 2018, and since then, relative stock performance has reversed with Abbott rising close to 50%.
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A one trick pony?
The source of AbbVie's initial outperformance, as well as its ensuing decline, relates to its mainstay drug Humira, which treats various autoimmune diseases and also happens to be the world's best-selling drug. The success of Humira has been staggering. In the six years since AbbVie's inception, Humira's sales doubled from $10.6 billion in 2013 to $19.9 billion in 2018. With the drug accounting for close to 60% of sales and a higher portion of profits, AbbVie's fortunes have been inextricably tied to Humira's.
It's not surprising then that AbbVie's share price peaked in anticipation of the expiration of the European Union (EU) patent on Humira, which took place on Oct. 16, 2018. Three biosimilars of Humira launched immediately after the patent expired: Novartis' Hyrimoz, Amgen's Amgevita and Biogen's Imraldi. Although the U.S. still accounts for the vast majority of Humira's sales, the patent expiration put at risk the $6 billion that Humira generates internationally.
These risks have been borne out. In AbbVie's third-quarter results, Humira's international sales fell more than 33%. While US sales continued to grow, the impact of the fall in international revenue was enough to drag Humira's overall sales down nearly 4%. Extrapolating the impact of the EU patent expiration, it is not surprising then that investors worry about what will happen after 2023 when Humira's US patent expires.
Hedging its bets
AbbVie has not been sitting idly by waiting for the Humira patent expiration story to play out. The company has been actively developing a strong pipeline of next-generation immunology and oncology drugs, such as Imbruvica and Venclexta to treat blood cancer and Skyrizi to treat psoriasis.
AbbVie's pipeline includes 60 compounds or indications in clinical development, including 30 which are in mid- to late-stage development. Indeed, the company's most recent results reflect the success of these efforts -- Q3 worldwide net revenues rose 3% to $8.5 billion despite the decline in Humira's sales and AbbVie raised its 2019 full-year adjusted earnings per share (EPS) guidance.
To cement its efforts to diversify away from Humira, AbbVie went one step further. In June, the company announced that it would acquire Allergan (NYSE: AGN), a specialty-drug manufacturer known for blockbuster drugs such as Botox and Restasis, for $63 billion.
The acquisition brings a number of benefits. With $16 billion in annual revenue in mostly unrelated therapeutic markets, Allergan's addition will further wean AbbVie off of dependence on Humira's franchise. The deal would be immediately accretive to earnings, contributing 10% to adjusted EPS in the first year with peak accretion in excess of 20%. The acquisition would also create immediate scale, with the combined entity ranking fourth in overall revenues and third in operating cash flow.
Operating cash flow, in addition to helping pay off the additional debt incurred in the acquisition, should also facilitate further dividend increases. In the third quarter, AbbVie continued its impressive streak of dividend hikes by announcing a 10.3% increase, boosting its accumulated dividend increase since separating from Abbott Labs to 195%.
Too cheap to ignore
At a price-to-earnings ratio of less than nine times forward earnings, AbbVie looks like a bargain compared to the market multiple of over 17 times expected earnings. It's high time for AbbVie to regain its luster as the better-performing sibling. In the meantime, AbbVie remains a great dividend stock with solid growth prospects that's too cheap for investors to ignore.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Indeed, the company's most recent results reflect the success of these efforts -- Q3 worldwide net revenues rose 3% to $8.5 billion despite the decline in Humira's sales and AbbVie raised its 2019 full-year adjusted earnings per share (EPS) guidance. With $16 billion in annual revenue in mostly unrelated therapeutic markets, Allergan's addition will further wean AbbVie off of dependence on Humira's franchise. AbbVie (NYSE: ABBV) and Abbott Laboratories (NYSE: ABT) were born of the same parent but separated at birth. | Indeed, the company's most recent results reflect the success of these efforts -- Q3 worldwide net revenues rose 3% to $8.5 billion despite the decline in Humira's sales and AbbVie raised its 2019 full-year adjusted earnings per share (EPS) guidance. AbbVie (NYSE: ABBV) and Abbott Laboratories (NYSE: ABT) were born of the same parent but separated at birth. Whereas Abbott Labs has been steadily hitting new highs, AbbVie peaked in 2018 and has since fallen close to 30%. | It's not surprising then that AbbVie's share price peaked in anticipation of the expiration of the European Union (EU) patent on Humira, which took place on Oct. 16, 2018. Indeed, the company's most recent results reflect the success of these efforts -- Q3 worldwide net revenues rose 3% to $8.5 billion despite the decline in Humira's sales and AbbVie raised its 2019 full-year adjusted earnings per share (EPS) guidance. AbbVie (NYSE: ABBV) and Abbott Laboratories (NYSE: ABT) were born of the same parent but separated at birth. | Indeed, the company's most recent results reflect the success of these efforts -- Q3 worldwide net revenues rose 3% to $8.5 billion despite the decline in Humira's sales and AbbVie raised its 2019 full-year adjusted earnings per share (EPS) guidance. In the third quarter, AbbVie continued its impressive streak of dividend hikes by announcing a 10.3% increase, boosting its accumulated dividend increase since separating from Abbott Labs to 195%. AbbVie (NYSE: ABBV) and Abbott Laboratories (NYSE: ABT) were born of the same parent but separated at birth. |
24807.0 | 2019-11-26 00:00:00 UTC | Is Myovant's New Prostate Cancer Drug a Game Changer? | ABBV | https://www.nasdaq.com/articles/is-myovants-new-prostate-cancer-drug-a-game-changer-2019-11-26 | nan | nan | A number of biotech stocks have made major moves over the past week. One of those was Myovant Sciences (NYSE: MYOV), a $1.1 billion biopharma company, which had its shares more than double on Nov. 19 following impressive clinical trial results in treating early, androgen-sensitive prostate cancer.
With hundreds of thousands of new prostate cancer patients diagnosed in the U.S. alone, there's plenty of potential for Myovant to hit a financial home run if its drug receives U.S. Food and Drug Administration approval. At the same time, this drug is well-positioned to become a leading treatment option for women with uterine fibroids.
Let's take a more detailed look at the company's recent results and the strength of its flagship drug candidate.
Image source: Getty Images.
Understanding the prostate cancer market
Prostate cancer is one of the leading causes of death in men, with around 174,000 patients in the U.S. diagnosed with the disease each year. While many drugs exist that cater to prostate cancer patients who have become resistant to initial androgen-lowering treatments, there's a strong market for drugs that can target prostate cancer while in its earlier, androgen-sensitive state.
The growth of prostate cancer cells is accelerated by the presence of sex hormones (called androgens) such as testosterone. As such, lowering a patient's testosterone levels can significantly slow down the disease's progression. However, after a certain point, prostate cancer becomes resistant to androgen-lowering treatments, which then requires different types of drugs to treat.
While major pharmaceutical companies have focused on this latter area, not as many are developing drugs focused on the former, androgen-sensitive phase of a patient's disease progression. It's this initial, androgen-sensitive area that Myovant is targeting with its new drug candidate.
A potential blockbuster in two different markets
Myovant has been developing a drug called relugolix, which is being tested in men with androgen-sensitive prostate cancer. Its recent phase 3 HERO trial demonstrated that the vast majority of men taking a once-per-day relugolix pill were able to reduce testosterone levels significantly and slow down the disease's progression. The trial met all of its primary and secondary endpoints and had a similar rate of adverse reactions in comparison to the standard-of-care leuprolide treatment.
Relugolix had also been tested as a treatment for another condition. Earlier this year, Myovant announced impressive results for another phase 3 trial with the drug, which targeted women with uterine fibroids, a condition where noncancerous tumors develop inside the uterine wall. Myovant's relugolix had shown showed significant improvements in reducing the excessive bleeding that results from the fibroids. This is a major market that shouldn't be overlooked by investors, with some research suggesting the U.S. uterine fibroid market could reach a whopping $39.9 billion by 2022.
Prostate cancer competition
While there are a number of big prostate cancer drugs already in the market, most of them target patients with androgen-resistant prostate cancer, meaning that Myovant isn't directly in competition with these companies. This includes companies like Johnson & Johnson and Pfizer, which own the two top androgen-resistant prostate cancer drugs in the world, Zytiga and Xtandi, respectively.
Instead, Myovant's relugolix would compete with leuprolide -- commonly known as Lupron -- which is owned by AbbVie (NYSE: ABBV), and a drug called Zoladex, which is owned by AstraZeneca. The results from this recent phase 3 study would suggest that relugolix has a slight edge in terms of efficacy, with a 96.7% response rate in sustained testosterone repression among patients in comparison to leuprolide's 88.8%. As long as relugolix holds some sort of competitive edge, whether in terms of efficacy or safety, there's a good chance it will be able to carve out a niche in this market.
Uterine fibroid competition
As for relugolix's potential as as a treatment for uterine fibroid-induced bleeding, Myovant's drug will soon be competing with AbbVie's own drug candidate, elagolix, which was recently submitted for FDA approval earlier this year following its own strong phase 3 trial results. However, elagolix was already approved by the FDA in 2018 as a pain treatment for a somewhat similar, albeit separate, condition known as endometriosis, which is when uterus-specific tissues appear in other parts of the female reproductive system, such as the ovaries or fallopian tubes. The fact that AbbVie's elagolix already has FDA approval for another uterine-health-related condition likely will help its odds for getting approved as a uterine fibroid treatment as well.
Although Myovant is working on its own phase 3 trial for relugolix as an endometriosis treatment, it only recently completed patient recruitment for the trial. This means that in comparison to AbbVie's elagolix, it's not going to enter the market (if it will at all) until much later in the future, possibly until 2021.
The main problem for Myovant is that, whether relugolix is in the prostate cancer or the uterine fibroid market, it's competing with pharmaceutical companies much larger than itself. AbbVie, for example, is around 115 times larger than Myovant. It'll easily be able to have a larger marketing budget than what Myovant can afford, not to mention the fact that as a well-known pharmaceutical giant, it already has deeper connections in the healthcare industry.
However, considering the previously mentioned size of the uterine fibroid treatment market, Myovant needs to capture only a small portion of the market to be a financial success. As long as relugolix isn't significantly inferior to elagolix in safety or efficacy (which seems unlikely), even a mildly successful relugolix would prove to be a home run.
What should investors think?
Myovant has two chances to hit it out of the park with relugolix, first in the prostate cancer market and second in the uterine fibrosis market. The company is facing competition from larger, better-funded industry giants, which means that relugolix needs to have an edge over its competitors' treatments in order to stand out amid stronger competitor marketing. Relugolix seems to have this edge in the prostate cancer field, but in uterine fibrosis, things are still uncertain.
The last thing worth noting is that Myovant is burning through cash at a significant rate. In its recent fiscal Q2 results, the company burned through $70.6 million over the past three months, with its cash reserves falling to just $157.6 million. Myovant has no revenue whatsoever right now, so it needs to have enough cash to last it for at least a year if not a bit longer. Thankfully, the company did mention it would be securing approximately $350 million in financing to make ends meet, likely until the end of 2020.
Overall, investors are right to be optimistic about the stock. Myovant's stock price has since dipped a little in a post-excitement correction, which makes it a bit of a better buy now than it was when the news of its prostate cancer trial first broke. If you're comfortable with a high-growth, high-risk biotech investment, consider adding a small starter position of this stock to your portfolio.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Instead, Myovant's relugolix would compete with leuprolide -- commonly known as Lupron -- which is owned by AbbVie (NYSE: ABBV), and a drug called Zoladex, which is owned by AstraZeneca. Uterine fibroid competition As for relugolix's potential as as a treatment for uterine fibroid-induced bleeding, Myovant's drug will soon be competing with AbbVie's own drug candidate, elagolix, which was recently submitted for FDA approval earlier this year following its own strong phase 3 trial results. The fact that AbbVie's elagolix already has FDA approval for another uterine-health-related condition likely will help its odds for getting approved as a uterine fibroid treatment as well. | Uterine fibroid competition As for relugolix's potential as as a treatment for uterine fibroid-induced bleeding, Myovant's drug will soon be competing with AbbVie's own drug candidate, elagolix, which was recently submitted for FDA approval earlier this year following its own strong phase 3 trial results. Instead, Myovant's relugolix would compete with leuprolide -- commonly known as Lupron -- which is owned by AbbVie (NYSE: ABBV), and a drug called Zoladex, which is owned by AstraZeneca. The fact that AbbVie's elagolix already has FDA approval for another uterine-health-related condition likely will help its odds for getting approved as a uterine fibroid treatment as well. | Uterine fibroid competition As for relugolix's potential as as a treatment for uterine fibroid-induced bleeding, Myovant's drug will soon be competing with AbbVie's own drug candidate, elagolix, which was recently submitted for FDA approval earlier this year following its own strong phase 3 trial results. Instead, Myovant's relugolix would compete with leuprolide -- commonly known as Lupron -- which is owned by AbbVie (NYSE: ABBV), and a drug called Zoladex, which is owned by AstraZeneca. The fact that AbbVie's elagolix already has FDA approval for another uterine-health-related condition likely will help its odds for getting approved as a uterine fibroid treatment as well. | Uterine fibroid competition As for relugolix's potential as as a treatment for uterine fibroid-induced bleeding, Myovant's drug will soon be competing with AbbVie's own drug candidate, elagolix, which was recently submitted for FDA approval earlier this year following its own strong phase 3 trial results. Instead, Myovant's relugolix would compete with leuprolide -- commonly known as Lupron -- which is owned by AbbVie (NYSE: ABBV), and a drug called Zoladex, which is owned by AstraZeneca. The fact that AbbVie's elagolix already has FDA approval for another uterine-health-related condition likely will help its odds for getting approved as a uterine fibroid treatment as well. |
24808.0 | 2019-11-24 00:00:00 UTC | Better Buy: AbbVie vs. GlaxoSmithKline | ABBV | https://www.nasdaq.com/articles/better-buy%3A-abbvie-vs.-glaxosmithkline-2019-11-24 | nan | nan | Big pharma stocks are a prized commodity among growth and income investors alike. The core reasons boil down to the fact that pharmaceuticals are an essential staple for millions of people, and the industry has been a hotbed of innovation over the past decade.
Nonetheless, pharmaceutical stocks do have a serious dark side. Patent expirations for top-selling products, unexpected competition, clinical and regulatory setbacks, and political headwinds are just a few of the reasons behind the absolutely hair-raising level of volatility within this group of equities. Pharmaceutical stocks, in fact, have consistently been one of the most volatile cohorts within the entire market since the early 2000s.
Image source: Getty Images.
Which big pharma stocks are worth this gut-wrenching roller coaster ride? AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) are two of the industry's most trusted names among value, growth, and income investors, thanks to their top-flight product portfolios and generous dividend programs. Which of these pharma giants is the better buy right now? Let's dig deeper to find out.
The case for AbbVie
Illinois-based AbbVie began life in 2013. The drugmaker was originally spun off from healthcare giant Abbott Laboratories (NYSE: ABT) in a move designed to unlock the latent value in both underlying businesses. Post-split, Abbott became a medical products specialist, while AbbVie inherited the company's immunology-heavy pharmaceutical portfolio and pipeline.
This strategic decision has proved to be a stroke of genius in many ways. Abbott and AbbVie have both gone on to produce market-crushing returns for shareholders over this period, as well as two of the most highly coveted dividend programs. Both companies, in fact, are included in the esteemed list of S&P 500 Dividend Aristocrats. Nonetheless, AbbVie was born with a hefty burden to bear -- namely, the eventual loss of exclusivity for top-selling immunology medicine Humira.
Since 2013, Humira has gone on to become the world's best-selling medicine, raking in approximately $20 billion in global sales in 2018. The downside is that Humira's rapid growth has kept AbbVie from truly diversifying its revenue stream. Despite spending $21 billion to acquire the megablockbuster blood cancer drug Imbruvica in 2015 and organically developing multiple high-value drugs of its own over the years, Humira still makes up nearly 60% of the drugmaker's annual revenue stream.
This year, AbbVie's management decided it was high-time to go all out to deal with its overreliance on Humira. To do so, the drugmaker joined forces with Botox maker Allergan (NYSE: AGN) in one of the largest mergers in biopharma history.
Before this merger announcement, Allergan was in a tailspin because of a host of managerial missteps, combined with the negative impacts stemming from the battle over the patent expiration for eye medication Restasis. AbbVie, in turn, apparently saw Allergan's misfortunes as the perfect opportunity to deal with the Humira problem. The two companies are now set to consummate their merger in the first quarter of 2020.
What's in store for this pharmaceutical supergiant in 2020 and beyond? The combined entity will sport best-in-class product portfolios in CNS, immunology, medical aesthetics, and women's health products. The flip side is that the new AbbVie will also happen to be one of the most highly leveraged biopharma companies in the world.
To deal with this debt issue, AbbVie plans on using Humira's sizable revenue stream to delever as fast as possible. Fortunately, the drugmaker does have a solid three years before Humira loses exclusivity in the states, giving it a nice cushion to iron out the kinks. AbbVie also scored two major regulatory approvals in immunology this year with Skyrizi and Rinvoq, which should further this deleveraging effort in a big way.
The case for Glaxo
Glaxo, in its current iteration, is about to turn 19 years old next month. The British multinational pharmaceutical giant, however, is about to undergo a radical transformation that will see it split into a consumer healthcare business and a standalone pharmaceutical/vaccines company in the not-so-distant future. This forthcoming split is the result of Glaxo's consumer healthcare joint-venture with fellow pharma giant Pfizer (NYSE: PFE).
What can investors expect from Glaxo's growth-oriented pharma and vaccines business in the next decade? Glaxo has had amazing success in the vaccine space of late, fueled by the skyrocketing sales of shingles vaccine Shingrix. However, Glaxo is still attempting to regain a foothold in the high-growth oncology arena.
After selling off its oncology assets in 2014, Glaxo stormed back into the space with the $5.1 billion acquisition of Tesaro for the PARP inhibitor Zejula last year, and the company has also tacked on several high-value clinical candidates in oncology as well. Oncology, in turn, should prove to be a key component of the company's overall growth profile in the coming decade.
Apart from vaccines and cancer meds, Glaxo's core respiratory franchise has also returned to its winning ways of late. Newer respiratory meds like Trelegy and Nucala have quickly come into their own as strong growth products, which has helped to offset the declines emanating from the former star asthma medication Advair. Glaxo's HIV joint venture ViiV Healthcare has been a surprising bright spot as well, even though it has had to compete against the 800-pound gorilla that is Gilead Sciences.
Which stock the better buy?
Although Glaxo has absolutely trounced AbbVie in terms of share price performance in 2019, this trend should flip in 2020, perhaps dramatically so. That's not to say Glaxo won't turn out to be a winning play next year, but AbbVie simply has more momentum heading into the new year.
The back-to-back approvals of Skyrizi and Rinvoq -- in conjunction with this game-changing Allergan merger -- have markedly changed the sentiment around AbbVie's stock. Moreover, AbbVie's management has made a clear commitment to the company's dividend program, despite its junk bond-like yield of 5.46%. Glaxo's brain trust, on the other hand, hasn't made any long-term commitments in regard to maintaining -- much less growing -- the biopharma's enormous annualized yield of 4.4%.
AbbVie, in kind, stands out as the more attractive income and growth play than Glaxo, although both stocks could easily end up beating the broader markets in 2020.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) are two of the industry's most trusted names among value, growth, and income investors, thanks to their top-flight product portfolios and generous dividend programs. The case for AbbVie Illinois-based AbbVie began life in 2013. Post-split, Abbott became a medical products specialist, while AbbVie inherited the company's immunology-heavy pharmaceutical portfolio and pipeline. | Nonetheless, AbbVie was born with a hefty burden to bear -- namely, the eventual loss of exclusivity for top-selling immunology medicine Humira. Moreover, AbbVie's management has made a clear commitment to the company's dividend program, despite its junk bond-like yield of 5.46%. AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) are two of the industry's most trusted names among value, growth, and income investors, thanks to their top-flight product portfolios and generous dividend programs. | AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) are two of the industry's most trusted names among value, growth, and income investors, thanks to their top-flight product portfolios and generous dividend programs. AbbVie, in kind, stands out as the more attractive income and growth play than Glaxo, although both stocks could easily end up beating the broader markets in 2020. The case for AbbVie Illinois-based AbbVie began life in 2013. | Moreover, AbbVie's management has made a clear commitment to the company's dividend program, despite its junk bond-like yield of 5.46%. AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) are two of the industry's most trusted names among value, growth, and income investors, thanks to their top-flight product portfolios and generous dividend programs. The case for AbbVie Illinois-based AbbVie began life in 2013. |
24809.0 | 2019-11-24 00:00:00 UTC | 3 Dividend Stocks to Buy on Sale | ABBV | https://www.nasdaq.com/articles/3-dividend-stocks-to-buy-on-sale-2019-11-24 | nan | nan | Major stock market indexes are hitting all-time highs. The current bull market is the longest one ever and is now in its 11th year. You might think it would be hard to find bargain stocks. And you probably think that it's even harder to find bargain dividend stocks.
While most dividend stocks are relatively pricey, there are still some bargains to be found. Three dividend stocks that you can buy on sale right now are AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Verizon Communications (NYSE: VZ).
Image source: Getty Images.
1. AbbVie
If you're looking for a dividend stock with a fantastic pedigree, you'll love AbbVie. The company is a Dividend Aristocrat with 48 consecutive years of dividend increases, including its time as part of Abbott Labs. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by a whopping 168%. Its dividend yield now stands at 5.5%.
AbbVie shares trade at a little over nine times expected earnings, well below the valuation of most big pharma stocks. It's cheap for a reason: Investors are worried about the company's prospects with its top-selling drug, Humira, facing biosimilar competition in Europe and biosimilars in the U.S. on the way in 2023.
There's no question that declining sales for Humira present a problem to AbbVie. After all, the drug currently generates 58% of the company's total revenue. But I don't think AbbVie's dividend will be in jeopardy at all because of the company's strategy to reduce its dependence on Humira.
A key part of that strategy is the launch of new drugs. AbbVie rolled out two immunology drugs this year, Rinvoq and Skyrizi, that should be huge blockbusters in the near future. The company also already has two cancer drugs with fast-growing sales, Imbruvica and Venclexta. In addition, AbbVie's pending acquisition of Allergan will make it significantly less reliant on Humira. While AbbVie will almost certainly face some bumps in the road over the next few years, its dividend payout should keep giving income-seeking investors a smooth ride.
2. Gilead Sciences
Gilead Sciences admittedly doesn't have the impressive dividend track record of AbbVie. The big biotech didn't even initiate a dividend program until 2015. But Gilead has shown a solid commitment to paying dividends since then, increasing its payout by nearly 47% in just four years. Its dividend now yields nearly 3.9%.
While many biotech stocks command premium valuations, Gilead's shares trade at close to 9 times expected earnings. The stock has been hammered over the last few years as sales for the company's hepatitis C virus (HCV) franchise declined. Gilead's HCV drugs cured so many patients that the market shrank. At the same time, competition increased, mainly from AbbVie.
But Gilead continues to dominate the HIV market. Biktarvy appears to be on track to become the best-selling HIV drug of all time. The biotech is also achieving significant clinical progress with potential long-acting HIV therapy GS-6207, a drug that RBC Capital Markets analyst Brian Abrahams views as the future of Gilead's HIV franchise.
Gilead is also expanding into new therapeutic areas. It hopes to win U.S. and European regulatory approval for filgotinib in treating rheumatoid arthritis. The biotech's pipeline includes drugs targeting nonalcoholic steatohepatitis, a liver disease with no approved treatments yet. Gilead remains the leader in cancer cell therapy as well with Yescarta picking up momentum. The company appears to be in a solid position to keep its attractive dividends flowing.
3. Verizon Communications
Not every bargain dividend stock is in the healthcare space. Telecommunications giant Verizon has increased its dividend for 13 years in a row. Its dividend yield currently stands at 4.1%.
Verizon isn't quite as cheap as AbbVie and Gilead, but its valuation still appears to be quite attractive. Shares trade at 12 times expected earnings. On another popular valuation metric, enterprise value-to-EBITDA (earnings before interest, taxes, depreciation, and amortization), Verizon is even cheaper than the two healthcare stocks and its chief rival, AT&T.
The primary reason Verizon is priced at such a discount is the intense competition in the telecom industry. Verizon and its rivals are cutting prices to retain and attract customers. They're also competing by offering bundling deals with TV streaming services. For example, Verizon is bundling a one-year subscription to Disney's new Disney+ streaming service with its own unlimited wireless plans and certain other products.
Despite the stiff competition, though, Verizon's dividend program shouldn't be fazed at all. The company also should have a new growth driver with the rollout of high-speed 5G networks.
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Keith Speights owns shares of AbbVie, Gilead Sciences, and Walt Disney. The Motley Fool owns shares of and recommends Gilead Sciences and Walt Disney. The Motley Fool recommends Verizon Communications and recommends the following options: long January 2021 $60 calls on Walt Disney and short January 2020 $130 calls on Walt Disney. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Three dividend stocks that you can buy on sale right now are AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Verizon Communications (NYSE: VZ). AbbVie If you're looking for a dividend stock with a fantastic pedigree, you'll love AbbVie. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by a whopping 168%. | Three dividend stocks that you can buy on sale right now are AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Verizon Communications (NYSE: VZ). AbbVie If you're looking for a dividend stock with a fantastic pedigree, you'll love AbbVie. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by a whopping 168%. | Three dividend stocks that you can buy on sale right now are AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Verizon Communications (NYSE: VZ). Gilead Sciences Gilead Sciences admittedly doesn't have the impressive dividend track record of AbbVie. See the 10 stocks *Stock Advisor returns as of June 1, 2019 Keith Speights owns shares of AbbVie, Gilead Sciences, and Walt Disney. | But I don't think AbbVie's dividend will be in jeopardy at all because of the company's strategy to reduce its dependence on Humira. At the same time, competition increased, mainly from AbbVie. Verizon isn't quite as cheap as AbbVie and Gilead, but its valuation still appears to be quite attractive. |
24810.0 | 2019-11-22 00:00:00 UTC | Enanta Pharmaceuticals' Q4 Results Pulled Down by AbbVie's Sinking HCV Sales | ABBV | https://www.nasdaq.com/articles/enanta-pharmaceuticals-q4-results-pulled-down-by-abbvies-sinking-hcv-sales-2019-11-22 | nan | nan | Enanta Pharmaceuticals' (NASDAQ: ENTA) got off to a great start in 2019 with its shares soaring more than 40%. It's been downhill since the first quarter, though. The pharma stock is now down more than 10% year to date.
Any hopes that Enanta's fiscal 2019 fourth-quarter results would help turn things around were dashed on Thursday when the company provided its Q4 update after the market closed. Here are the highlights from the drugmaker's latest quarterly results.
Image Source: Getty Images.
By the numbers
Enanta reported Q4 revenue of $51.3 million, a 24% decline from the prior-year period. Analysts were expecting that fourth-quarter revenue would be close to $55.9 million.
The company announced net income of $9.2 million, or $0.44 per share, based on generally accepted accounting principles (GAAP). This compared to earnings of $27.4 million, or $1.30 per share, in the same period in 2018. Wall Street analysts estimated that Enanta would post earnings of $0.53 per share in the quarter.
Enanta's cash, cash equivalents, and short-term investments totaled $400 million as of Sept. 30, 2019. This was an increase from the $325 million on hand at the end of the company's fiscal 2018 fourth quarter.
Behind the numbers
Enanta made practically all of its revenue from royalties paid by AbbVie (NYSE: ABBV) on sales of hepatitis C virus (HCV) drug Mavyret. This royalty revenue was higher in the fourth quarter of 2019 than in the prior-year period. However, Enanta's total revenue fell because the company received a milestone payment of $15 million from AbbVie in the fourth quarter of 2018 and didn't have any milestone payments in the recent quarter.
AbbVie stated in its third-quarter conference call that its global HCV revenue slipped from the prior-year period due to lower patient volumes and increased competition in the U.S. managed-Medicaid business. Enanta is basically a bystander as AbbVie slugs it out in the HCV market with Gilead Sciences.
Enanta's bottom line deteriorated mainly as a result of its falling revenue. The company's operating expenses also increased by 37% year over year, to $44.9 million, as the company spent more on its pipeline programs and increased staffing. Its net income was helped, though, by an income tax benefit of $0.5 million. In the prior-year period, the company recorded an income tax expense of $8.5 million.
Looking ahead
The company projects that its research and development expenses in fiscal year 2020 will be between $155 million and $175 million, with general and administrative expenses between $27 million and $33 million. Both ranges reflect significant increases from fiscal 2019 spending.
Enanta expects that its cash position combined with royalty revenue will enable it to fund operations "for the foreseeable future." Even though sales for Mavyret have dropped, AbbVie CFO Robert Michael said in his company's quarterly update that the drug should "generate durable cash flow for AbbVie well into the next decade." That should translate to durable royalties for Enanta.
Pipeline progress is always critically important for pharmaceutical stocks, and Enanta is looking for several key pipeline developments in the near future. The company anticipates reporting data from its Intrepid phase 2 clinical study evaluating EDP-305 in treating primary biliary cholangitis (PBC) in the second quarter of 2020. Results from the first part of a phase 1 clinical study of EDP-514 in treating patients infected with the hepatitis B virus are expected in the first quarter of 2020.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Behind the numbers Enanta made practically all of its revenue from royalties paid by AbbVie (NYSE: ABBV) on sales of hepatitis C virus (HCV) drug Mavyret. AbbVie stated in its third-quarter conference call that its global HCV revenue slipped from the prior-year period due to lower patient volumes and increased competition in the U.S. managed-Medicaid business. However, Enanta's total revenue fell because the company received a milestone payment of $15 million from AbbVie in the fourth quarter of 2018 and didn't have any milestone payments in the recent quarter. | Behind the numbers Enanta made practically all of its revenue from royalties paid by AbbVie (NYSE: ABBV) on sales of hepatitis C virus (HCV) drug Mavyret. However, Enanta's total revenue fell because the company received a milestone payment of $15 million from AbbVie in the fourth quarter of 2018 and didn't have any milestone payments in the recent quarter. AbbVie stated in its third-quarter conference call that its global HCV revenue slipped from the prior-year period due to lower patient volumes and increased competition in the U.S. managed-Medicaid business. | However, Enanta's total revenue fell because the company received a milestone payment of $15 million from AbbVie in the fourth quarter of 2018 and didn't have any milestone payments in the recent quarter. Behind the numbers Enanta made practically all of its revenue from royalties paid by AbbVie (NYSE: ABBV) on sales of hepatitis C virus (HCV) drug Mavyret. AbbVie stated in its third-quarter conference call that its global HCV revenue slipped from the prior-year period due to lower patient volumes and increased competition in the U.S. managed-Medicaid business. | Behind the numbers Enanta made practically all of its revenue from royalties paid by AbbVie (NYSE: ABBV) on sales of hepatitis C virus (HCV) drug Mavyret. However, Enanta's total revenue fell because the company received a milestone payment of $15 million from AbbVie in the fourth quarter of 2018 and didn't have any milestone payments in the recent quarter. AbbVie stated in its third-quarter conference call that its global HCV revenue slipped from the prior-year period due to lower patient volumes and increased competition in the U.S. managed-Medicaid business. |
24811.0 | 2019-11-21 00:00:00 UTC | AbbVie Shareholders Have a Lot to Look Forward To With Allergan | ABBV | https://www.nasdaq.com/articles/abbvie-shareholders-have-a-lot-to-look-forward-to-with-allergan-2019-11-21 | nan | nan | AbbVie's (NYSE: ABBV) third-quarterearnings callreminded investors about the transformative potential of the Allergan acquisition for the pharma giant. Management reiterated that they continue to expect the deal to close by the end of the first quarter of 2020. This is promising for investors, as the combined entity will allow AbbVie to gain a more diversified foothold in faster-growing therapeutic areas such as Botox and neuroscience while expanding its immunology portfolio with the addition of Allergan's Linzess and Viberzi.
AbbVie CEO Richard Gonzalez said on theearnings callthat "the Allergan transaction will make us even stronger and more diversified." Let's see why.
Photo Credit: Getty Images
A formidable edge
The new AbbVie will have a strong market leadership position in a number of therapeutic areas. AbbVie would be No. 1 in immunology, supported by its flagship arthritis treatment, Humira, but investors are also excited about potential approvals following results of ongoing Phase 3 clinical trials of Skyrizi in psoriasis and Upadacitinib in rheumatoid arthritis before the end of 2020. Not surprisingly, AbbVie will also have a market leadership position in medical aesthetics, with a product suite covering Botox, the CoolSculpting fat removal system, and Juvederm dermal fillers, which are used to help conceal wrinkles. Medical aesthetics is still a rapidly growing market, especially internationally. Management cited a Markets and Markets Medical Aesthetics report from September 2018 that cited the aesthetics addressable market being $12B at the time and "growing."
Investors should be encouraged by Gonzalez's comments on the call that, "Based on the uniqueness of this particular molecule, we have come to the conclusion that it would be extremely difficult to create a biosimilar version of Botox, and I would tell you, we looked at this very extensively with a lot of outside expertise and we feel very confident that that's the case." This should create a steady stream of earnings and cash flow to AbbVie to help support other therapeutic areas without the worry of generic competition.
Balance sheet nip-and-tuck
The scale and synergies of the acquisition are another bright spot for investors in a world where size matters more than ever to fend off competition.
Let's start with scale. Using full-year 2018 financials, adding AbbVie and Allergan gives us an entity that would have trailed only Johnson & Johnson, Roche, and Pfizer in revenue, lagging only the first two in operating cash flow. With the company's new scale, management believes it can achieve high-single-digit revenue growth.
With respect to the synergies, management expects the combined entity to lower costs and increase returns. Total savings are expected to top $2 billion over a three-plus-year period: 50% from R&D efficiency; 40% from selling, general, and administrative expenses as the footprint of the combined organization becomes leaner; and 10% from greater manufacturing efficiency. Those savings should show up quickly: Earnings per share are expected to get a 10% boost in year one and eventually top 20%. This will help support the increase of an already generous 5%-plus dividend yield, coupled with the promise of further shareholder-friendly actions as the company reduces its debt load. Gonzalez said that "combined, we will generate significant earnings and cash flow to enhance our innovative R&D platform support a strong and growing dividend and rapidly pay down debt."
If that's not enough
Year to date, AbbVie's stock price has been more or less flat, lagging the S&P 500. As a result, it's sporting a forward price-to-earnings multiple of roughly 10 times consensus estimates. That's not a steep price for an attractive dividend yield coupled with the prospect of accelerating revenue and earnings growth.
As closure of the acquisition draws near, any negative investor sentiment should begin to abate, allowing for the prospects of multiple expansion. Gonzalez said on the call, "Our model is more conservative than what the Allergan current performance is and certainly more conservative than their longer-range forecast, but it still does project growth for Botox going forward." Thus, this multiple expansion should be led by reduced fears around competition, realized cost synergies, and potential for increased earnings guidance.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | This is promising for investors, as the combined entity will allow AbbVie to gain a more diversified foothold in faster-growing therapeutic areas such as Botox and neuroscience while expanding its immunology portfolio with the addition of Allergan's Linzess and Viberzi. Not surprisingly, AbbVie will also have a market leadership position in medical aesthetics, with a product suite covering Botox, the CoolSculpting fat removal system, and Juvederm dermal fillers, which are used to help conceal wrinkles. AbbVie's (NYSE: ABBV) third-quarterearnings callreminded investors about the transformative potential of the Allergan acquisition for the pharma giant. | AbbVie's (NYSE: ABBV) third-quarterearnings callreminded investors about the transformative potential of the Allergan acquisition for the pharma giant. This is promising for investors, as the combined entity will allow AbbVie to gain a more diversified foothold in faster-growing therapeutic areas such as Botox and neuroscience while expanding its immunology portfolio with the addition of Allergan's Linzess and Viberzi. AbbVie CEO Richard Gonzalez said on theearnings callthat "the Allergan transaction will make us even stronger and more diversified." | This is promising for investors, as the combined entity will allow AbbVie to gain a more diversified foothold in faster-growing therapeutic areas such as Botox and neuroscience while expanding its immunology portfolio with the addition of Allergan's Linzess and Viberzi. Using full-year 2018 financials, adding AbbVie and Allergan gives us an entity that would have trailed only Johnson & Johnson, Roche, and Pfizer in revenue, lagging only the first two in operating cash flow. AbbVie's (NYSE: ABBV) third-quarterearnings callreminded investors about the transformative potential of the Allergan acquisition for the pharma giant. | AbbVie would be No. If that's not enough Year to date, AbbVie's stock price has been more or less flat, lagging the S&P 500. AbbVie's (NYSE: ABBV) third-quarterearnings callreminded investors about the transformative potential of the Allergan acquisition for the pharma giant. |
24812.0 | 2019-11-21 00:00:00 UTC | January 2020 Options Now Available For AbbVie (ABBV) | ABBV | https://www.nasdaq.com/articles/january-2020-options-now-available-for-abbvie-abbv-2019-11-21 | nan | nan | Investors in AbbVie Inc (Symbol: ABBV) saw new options become available today, for the January 2020 expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the ABBV options chain for the new January 2020 contracts and identified one put and one call contract of particular interest.
The put contract at the $80.00 strike price has a current bid of 58 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $80.00, but will also collect the premium, putting the cost basis of the shares at $79.42 (before broker commissions). To an investor already interested in purchasing shares of ABBV, that could represent an attractive alternative to paying $86.33/share today.
Because the $80.00 strike represents an approximate 7% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 78%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 0.72% return on the cash commitment, or 6.15% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for AbbVie Inc, and highlighting in green where the $80.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $92.50 strike price has a current bid of 11 cents. If an investor was to purchase shares of ABBV stock at the current price level of $86.33/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $92.50. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 7.27% if the stock gets called away at the January 2020 expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if ABBV shares really soar, which is why looking at the trailing twelve month trading history for AbbVie Inc, as well as studying the business fundamentals becomes important. Below is a chart showing ABBV's trailing twelve month trading history, with the $92.50 strike highlighted in red:
Considering the fact that the $92.50 strike represents an approximate 7% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 75%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 0.13% boost of extra return to the investor, or 1.08% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example is 49%, while the implied volatility in the call contract example is 39%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 251 trading day closing values as well as today's price of $86.33) to be 30%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of Stocks Conducting Buybacks »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Of course, a lot of upside could potentially be left on the table if ABBV shares really soar, which is why looking at the trailing twelve month trading history for AbbVie Inc, as well as studying the business fundamentals becomes important. Below is a chart showing ABBV's trailing twelve month trading history, with the $92.50 strike highlighted in red: Considering the fact that the $92.50 strike represents an approximate 7% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in AbbVie Inc (Symbol: ABBV) saw new options become available today, for the January 2020 expiration. | Below is a chart showing ABBV's trailing twelve month trading history, with the $92.50 strike highlighted in red: Considering the fact that the $92.50 strike represents an approximate 7% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in AbbVie Inc (Symbol: ABBV) saw new options become available today, for the January 2020 expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the ABBV options chain for the new January 2020 contracts and identified one put and one call contract of particular interest. | Below is a chart showing the trailing twelve month trading history for AbbVie Inc, and highlighting in green where the $80.00 strike is located relative to that history: Turning to the calls side of the option chain, the call contract at the $92.50 strike price has a current bid of 11 cents. Below is a chart showing ABBV's trailing twelve month trading history, with the $92.50 strike highlighted in red: Considering the fact that the $92.50 strike represents an approximate 7% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in AbbVie Inc (Symbol: ABBV) saw new options become available today, for the January 2020 expiration. | At Stock Options Channel, our YieldBoost formula has looked up and down the ABBV options chain for the new January 2020 contracts and identified one put and one call contract of particular interest. Below is a chart showing ABBV's trailing twelve month trading history, with the $92.50 strike highlighted in red: Considering the fact that the $92.50 strike represents an approximate 7% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in AbbVie Inc (Symbol: ABBV) saw new options become available today, for the January 2020 expiration. |
24813.0 | 2019-11-21 00:00:00 UTC | 1 Attractive Pharma Stock You Probably Haven't Heard Of | ABBV | https://www.nasdaq.com/articles/1-attractive-pharma-stock-you-probably-havent-heard-of-2019-11-21 | nan | nan | December will mark the one-year anniversary for the initial listing of American depositary shares on the New York Stock Exchange by Takeda Pharmaceutical (NYSE: TAK). Many U.S. investors are unfamiliar with the name, likely due to its relatively recent listing on a major U.S. exchange.
Founded in Japan over 230 years ago, Takeda makes and sells drugs around the globe. Roughly 86% of its 50,000 employees work outside of Japan. Its most well-known products in the U.S. are diabetes drug Actos, Prevacid for heartburn and ulcers, and Adderall XR and Vyvanse, which treat attention deficit hyperactivity disorder and certain eating and sleeping disorders. Takeda's key business areas are rare diseases, neuroscience, oncology, gastrointestinal diseases, and plasma-derived therapies.
Image source: Getty Images.
Added sales firepower with its Shire acquisition
Takeda wrapped up its $62 billion acquisition of Shire in January 2019, touting that the combined companies generated more than $30 billion in annual sales. That's quite impressive, as revenue growth in the first half of 2019 exceeded 88% year over year. But the gain was attributable to the newly acquired Shire products. Sales of legacy Takeda products were essential flat.
To buy Shire, Takeda took on boatloads of debt. Ample cash flow enabled Takeda to pay down about $5.4 billion during the first half of this year. This effectively deleveraged the company from 4.7 times net debt to adjusted EBITDA on March 31, to 3.9 times on Sept. 30. Takeda aims to lower this ratio to 2 times within three to five years.
It hopes to raise an additional $10 billion by divesting noncore businesses. The company has announced three divestitures in 2019 producing roughly $4 billion in up-front payments and another $1.9 billion upon attainment of certain milestones. Investors can expect to see more, but the timing is unpredictable.
Takeda raises full-year operating profit guidance
Based on successful integration efficiencies and favorable business momentum, the company increased its full-year guidance for operating profit to 930 billion yen ($8.5 billion) from 910 billion yen. Its revenue forecast is slightly down from the prior quarter, primarily driven by foreign exchange. It reports in Japanese yen even though 49% of the company's sales originate in the U.S.
Investors should note that Takeda pays one of the healthiest dividends among big pharmaceutical companies, currently yielding over 4%.
A slate of new medicines
At its R&D Day on Nov. 14, Takeda highlighted why investors should get excited for the future. Starting with its 14 existing global brands, Takeda announced "at least 20 additional indications and major market expansions" will drive growth through fiscal year 2024. On top of that, the company said that 12 new drugs could be approved for up to 14 different disease indications during the same time period. The dozen molecules in development are either best in class or first in class, according to Takeda. Pivotal trials are already underway for eight of them.
Image source: Getty Images.
Why now?
Takeda's prospects look promising, but is that already reflected in the valuation? The current market cap sits around $65 billion. Keep in mind that's not much more than the $62 billion it paid for Shire but investors get the benefit of products from both companies under one roof.
Takeda's price-to-earnings ratio is 24.66, not dissimilar to the P/E of 24.98 for Johnson & Johnson (NYSE: JNJ). For comparison, Pfizer (NYSE: PFE) and Eli Lilly (NYSE: LLY) sport P/E ratios of around 13, while those of AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) exceed 40. Simply put, investors pay a smaller premium for Takeda than for some of its peers.
Investors must keep focused on the company's ability to generate income while paying down debt. Headwinds on new products could translate into significantly less cash flow. On the positive side, Takeda's broad portfolio of drugs in multiple disease areas means it could always sell off a business if it absolutely had to, although that's a low-probability event. The stock has begun reawakening over the past few months, so investors should jump in now if they like what they see.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | For comparison, Pfizer (NYSE: PFE) and Eli Lilly (NYSE: LLY) sport P/E ratios of around 13, while those of AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) exceed 40. December will mark the one-year anniversary for the initial listing of American depositary shares on the New York Stock Exchange by Takeda Pharmaceutical (NYSE: TAK). Starting with its 14 existing global brands, Takeda announced "at least 20 additional indications and major market expansions" will drive growth through fiscal year 2024. | For comparison, Pfizer (NYSE: PFE) and Eli Lilly (NYSE: LLY) sport P/E ratios of around 13, while those of AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) exceed 40. December will mark the one-year anniversary for the initial listing of American depositary shares on the New York Stock Exchange by Takeda Pharmaceutical (NYSE: TAK). Image source: Getty Images. | For comparison, Pfizer (NYSE: PFE) and Eli Lilly (NYSE: LLY) sport P/E ratios of around 13, while those of AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) exceed 40. Added sales firepower with its Shire acquisition Takeda wrapped up its $62 billion acquisition of Shire in January 2019, touting that the combined companies generated more than $30 billion in annual sales. Takeda raises full-year operating profit guidance Based on successful integration efficiencies and favorable business momentum, the company increased its full-year guidance for operating profit to 930 billion yen ($8.5 billion) from 910 billion yen. | For comparison, Pfizer (NYSE: PFE) and Eli Lilly (NYSE: LLY) sport P/E ratios of around 13, while those of AbbVie (NYSE: ABBV) and GlaxoSmithKline (NYSE: GSK) exceed 40. Added sales firepower with its Shire acquisition Takeda wrapped up its $62 billion acquisition of Shire in January 2019, touting that the combined companies generated more than $30 billion in annual sales. That's quite impressive, as revenue growth in the first half of 2019 exceeded 88% year over year. |
24814.0 | 2019-11-18 00:00:00 UTC | Pfizer: FDA Approves ABRILADA As Biosimilar To Humira - Quick Facts | ABBV | https://www.nasdaq.com/articles/pfizer%3A-fda-approves-abrilada-as-biosimilar-to-humira-quick-facts-2019-11-18 | nan | nan | (RTTNews) - Pfizer Inc. (PFE) announced the FDA has approved ABRILADA as a biosimilar to Humira for the treatment of certain patients with rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, adult Crohn's disease, ulcerative colitis and plaque psoriasis.
ABRILADA is a tumor necrosis factor or TNF blocker and biosimilar to Humira. It targets and blocks TNF, which is believed to help reduce inflammation.
Pfizer said the company is working to make ABRILADA available to U.S. patients as soon as feasible based on the terms of its agreement with AbbVie. The company's current plans are to launch in 2023.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Pfizer said the company is working to make ABRILADA available to U.S. patients as soon as feasible based on the terms of its agreement with AbbVie. (RTTNews) - Pfizer Inc. (PFE) announced the FDA has approved ABRILADA as a biosimilar to Humira for the treatment of certain patients with rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, adult Crohn's disease, ulcerative colitis and plaque psoriasis. ABRILADA is a tumor necrosis factor or TNF blocker and biosimilar to Humira. | Pfizer said the company is working to make ABRILADA available to U.S. patients as soon as feasible based on the terms of its agreement with AbbVie. (RTTNews) - Pfizer Inc. (PFE) announced the FDA has approved ABRILADA as a biosimilar to Humira for the treatment of certain patients with rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, adult Crohn's disease, ulcerative colitis and plaque psoriasis. ABRILADA is a tumor necrosis factor or TNF blocker and biosimilar to Humira. | Pfizer said the company is working to make ABRILADA available to U.S. patients as soon as feasible based on the terms of its agreement with AbbVie. (RTTNews) - Pfizer Inc. (PFE) announced the FDA has approved ABRILADA as a biosimilar to Humira for the treatment of certain patients with rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, adult Crohn's disease, ulcerative colitis and plaque psoriasis. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Pfizer said the company is working to make ABRILADA available to U.S. patients as soon as feasible based on the terms of its agreement with AbbVie. (RTTNews) - Pfizer Inc. (PFE) announced the FDA has approved ABRILADA as a biosimilar to Humira for the treatment of certain patients with rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, adult Crohn's disease, ulcerative colitis and plaque psoriasis. ABRILADA is a tumor necrosis factor or TNF blocker and biosimilar to Humira. |
24815.0 | 2019-11-17 00:00:00 UTC | Better Buy: Eli Lilly vs. AbbVie | ABBV | https://www.nasdaq.com/articles/better-buy%3A-eli-lilly-vs.-abbvie-2019-11-17 | nan | nan | Neither Eli Lilly (NYSE: LLY) nor AbbVie (NYSE: ABBV) has provided much for investors to get excited about so far in 2019. Both big pharma stocks are down by single-digit percentages year to date. But Lilly and AbbVie each hold the potential to deliver more attractive returns down the stretch.
Which of these two stocks is the better pick for long-term investors? Here's how Lilly and AbbVie compare in several key areas.
Image source: Getty Images.
Current products
Eli Lilly claims eight products with fast-growing sales. The company's top-selling drug, Trulicity, generated revenue of a little over $1 billion in the third quarter, up 24% year over year. Another diabetes drug, Jardiance, raked in nearly $241 million in Q3, a 44% jump from the prior-year period. Cancer drugs Cyramza and Verzenio saw sales soar 21% and 86%, respectively.
A couple of newer products are also stepping up to the plate for Lilly. Third-quarter sales for rheumatoid arthritis drug Olumiant more than doubled from the prior-year period to nearly $115 million. Migraine drug Emgality, which the FDA approved in September 2018, delivered sales of close to $48 million in Q3. Lilly also has recently won FDA approval for another promising migraine drug, Reyvow.
Lilly's immunology drug Taltz is another big winner, with sales jumping 29% year over year to $340 million in the third quarter. That increase disappointed some investors, though, who were expecting even stronger growth. Lilly's real problem areas, however, are with several of its older drugs. Sales continue to plunge for Cialis, while revenue from Humulin, Alimta, and Forteo slid by single-digit percentages in Q3.
AbbVie continues to rely heavily on its powerhouse immunology drug Humira. Sales for the top-selling drug totaled over $4.9 billion in Q3, down 3.7% year over year because of biosimilar competition in Europe. Humira's sales will really plummet beginning in 2023, when biosimilars reach the U.S. market.
But AbbVie has several other drugs that it thinks can more than offset the coming declines. Sales for cancer drug Imbruvica continue to soar, up 29% to a little over $1 billion in Q3. Another cancer drug, Venclexta, is generating even faster growth, with Q3 sales more than doubling year over year to $221 million.
Market researcher EvaluatePharma ranked AbbVie's new immunology drugs, Rinvoq and Skyrizi, among the top five new drug launches of 2019. The drugs could together deliver peak annual sales topping $10 billion.
AbbVie's pending acquisition of Allergan (NYSE: AGN) will bring several other major products into its lineup. The most important of these drugs is Botox, which saw sales rise 6% year over year in Q3 to nearly $929 million. AbbVie will also pick up fast-growing antipsychotic drug Vraylar and birth control pill Lo Loestrin in addition to several other Allergan products with significant sales.
Pipeline
Eli Lilly claims seven programs awaiting regulatory approval and 15 programs in late-stage clinical studies. The company also has 12 programs in phase 2 testing, with 25 programs in phase 1 studies.
Several of Lilly's programs awaiting approval and in late-stage testing are seeking new indications for already-approved drugs. Two new drugs, though, especially stand out. Mirikizumab targets treatment of Crohn's disease, psoriasis, and ulcerative colitis. Tanezumab, which Lilly is developing with Pfizer, targets cancer pain, osteoarthritic pain, and chronic lower back pain.
AbbVie has 16 late-stage programs. The company's pipeline also includes 12 phase 2 programs plus 22 phase 1 programs. The acquisition of Allergan would add another 12 late-stage programs and 15 phase 2 programs, along with at least five early stage programs.
Like Eli Lilly, several of AbbVie's late-stage programs feature already-approved drugs that could pick up new indications, notably including Rinvoq, Skyrizi, and Venclexta. The company also has a promising new Parkinson's disease drug, ABBV-951, in late-stage testing.
Dividend
Lilly's dividend yield currently stands at nearly 2.3%. The company has increased its dividend payout in each of the last five years.
AbbVie ranks as one of the most attractive dividend stocks on the market, with its dividend yielding nearly 5.5%. It has boosted its dividend for an impressive 47 years in a row, including the time it was part of Abbott Labs. Since being spun off from Abbott in 2013, AbbVie has increased its dividend by 195%.
Valuation
Eli Lilly stock currently trades at 17 times forward earnings. This is a significantly higher valuation than that of AbbVie, which trades at only nine times forward earnings.
Better buy
Growth investors can find better alternatives than either of these two pharma stocks. Most investors considering Lilly or AbbVie will probably primarily focus on the dividends. Based on this criterion, AbbVie is definitely the better pick. It's also the more attractive choice for value investors.
I expect that Eli Lilly will deliver stronger growth over the next several years than AbbVie will, though. Lilly is already dealing with the impact of slumping sales for Cialis, while AbbVie has yet to face the toughest challenges for Humira. Over the longer term, however, I fully expect AbbVie will return to solid growth. The company's early and mid-stage pipeline looks very promising. I also suspect that the Allergan acquisition could prove to be a smarter move than many think.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie will also pick up fast-growing antipsychotic drug Vraylar and birth control pill Lo Loestrin in addition to several other Allergan products with significant sales. Like Eli Lilly, several of AbbVie's late-stage programs feature already-approved drugs that could pick up new indications, notably including Rinvoq, Skyrizi, and Venclexta. Lilly is already dealing with the impact of slumping sales for Cialis, while AbbVie has yet to face the toughest challenges for Humira. | Like Eli Lilly, several of AbbVie's late-stage programs feature already-approved drugs that could pick up new indications, notably including Rinvoq, Skyrizi, and Venclexta. Neither Eli Lilly (NYSE: LLY) nor AbbVie (NYSE: ABBV) has provided much for investors to get excited about so far in 2019. But Lilly and AbbVie each hold the potential to deliver more attractive returns down the stretch. | Like Eli Lilly, several of AbbVie's late-stage programs feature already-approved drugs that could pick up new indications, notably including Rinvoq, Skyrizi, and Venclexta. Neither Eli Lilly (NYSE: LLY) nor AbbVie (NYSE: ABBV) has provided much for investors to get excited about so far in 2019. But Lilly and AbbVie each hold the potential to deliver more attractive returns down the stretch. | AbbVie ranks as one of the most attractive dividend stocks on the market, with its dividend yielding nearly 5.5%. I expect that Eli Lilly will deliver stronger growth over the next several years than AbbVie will, though. Neither Eli Lilly (NYSE: LLY) nor AbbVie (NYSE: ABBV) has provided much for investors to get excited about so far in 2019. |
24816.0 | 2019-11-15 00:00:00 UTC | 5 Ways to Make Your Money Work for You | ABBV | https://www.nasdaq.com/articles/5-ways-to-make-your-money-work-for-you-2019-11-15 | nan | nan | "She works hard for the money
So hard for it, honey
She works hard for the money
So you better treat her right"
-- "She Works Hard for the Money," Donna Summer, from the 1983 album She Works Hard for the Money
Most of us are used to working hard for our money. We need our jobs in order to earn enough money to keep a roof over our head and food on our table. Most of us need to be saving for retirement, too, but that can be hard to do. It can help a lot to take some of our money and have it work for us. Here are a few ways you might be able to put your dollars to work.
Inage source: Getty Images.
Pay off debts
It's not enough to just be making minimum payments on debts, especially high-interest-rate debts. Those need to be paid off as soon as possible. Not doing so can leave you further in debt and increasingly unable to build a secure financial future. Carrying significant debt at high interest rates is a lot like investing -- in reverse. Instead of seeing your net worth grow, you'll see it shrink as you pay substantial sums to your lender.
Fortunately, that dire situation also means that every such dollar of debt that you retire will give you a guaranteed return, by letting you no longer have to pay interest on it. For example, if you owe $20,000 on credit cards and are being charged 20% in interest, paying off $5,000 of that debt will be like earning a 20% return -- worth $1,000 in avoided interest payments in the first year alone.
Buy stocks
Once you're no longer facing high-interest-rate debt, look into investing in the stock market. Few investments are likely to grow as quickly as stocks can, and grow more over the long run. Here's some evidence of that, via Wharton Business School professor Jeremy Siegel, who calculated the average returns for stocks, bonds, bills, gold, and the dollar between 1802 and 2012:
Source: Stocks for the Long Run, Jeremy Siegel.
The table below shows just what a difference the annual growth rate makes to an annual investment of $10,000:
Data source: Calculations by author.
You don't have to earn a master's degree in finance in order to invest in stocks, either. You might simply park your money (adding more regularly) in a low-fee, broad-market index fund, such as one that tracks the S&P 500 index (which is made up of 500 big American companies). The SPDR S&P 500 ETF (NYSEMKT: SPY) fits the bill, as do other index funds and exchange-traded funds.
Buy dividend-paying stocks
Broad-market index funds will generally feature dividend payments, but their yields won't usually be too hefty. Recently, for example, the SPDR S&P 500 yielded about 1.8%. You can do even better than that by including some dividend-paying stocks in your portfolio -- or by investing in some dividend- or income-focused mutual funds. Having $200,000 distributed among a handful of healthy and growing dividend-paying stocks with an average annual yield of 4%, for example, will generate $8,000 in dividend income annually -- about $667 per month. That can go a long way in retirement.
Just to give you an idea of what kind of dividend yields can be found these days, below are a few familiar companies and their recent dividend yields:
Data source: Yahoo! Financial.
Best of all, healthy and growing dividend-paying companies tend to increase their payouts regularly, helping your income grow -- and often keeping up with inflation, as well.
Image source: Getty Images.
Develop passive income streams
Here's a great strategy for putting your dollars to work for you that can take more effort than other strategies -- but might pay out even more: developing passive (or largely passive) income. This can take many forms, some simpler than others. Some examples include:
Royalty income or residuals: If you can land a major role in a television show that runs for many seasons and then airs for years afterward, you'll collect cash for each rerun. Alternatively, you might upload lots of good photos to sites such as shutterstock.com or istockphoto.com, where others can buy them over and over again. Similarly, come up with some clever designs for T-shirts, mugs, and other items, and people might buy those items at sites such as zazzle.com and cafepress.com. At Etsy and other sites, people can buy your design in .PDF or another form to use on wedding invitations or other print items. You might also write a short book or guide and self-publish it as an e-book on sites such as Amazon.
Annuities: If you take a large sum and buy one or more fixed annuities with it, you can set yourself up to receive monthly infusions of cash for the rest of your life, starting now or when you retire or even a certain number of years after you retire. As an example, a 65-year-old man could get around $540 per month for the rest of his life for $100,000, while a 70-year-old married couple could spend $200,000 to get around $1,030 each month as long as one or both of them are living.
A reverse mortgage: Reverse mortgages have their downsides and are not for everyone, but one might serve you well, depending on your situation. It involves getting a loan from a financial institution that pays you a certain sum each month (or, in some cases, as a lump sum), with your home as collateral. The loan doesn't have to be repaid until you're no longer living in the home, and it's often repaid through the sale of the home.
Rented space: You can collect money relatively easily by renting out space in your home or your entire home for a few days and nights a year or for many weeks or months. You might list your space on sites such as Airbnb.com, VRBO.com, and HomeAway.com. Even driveway space or garages can be rented out in some markets.
Invest in yourself
Finally, a great way to put your money to work for you is to invest in yourself. This can help you get hired, promoted, and into new, more satisfying, and more lucrative careers. You might take some courses and earn a new certification or degree to make yourself more qualified for higher positions at work, or you might aim for an entirely new field of work.
Learning a new language might be the ticket to more or better opportunities, and in some cases simply spending money on a fresher, more professional wardrobe can make a difference. Here's a last idea: If you find yourself frequently feeling down and pessimistic about your future, invest in some counseling. That could help you turn yourself around and get ahead in life.
Spending just $500 or $2,000 on yourself might net you much more than that through a better job. And the more you earn, the more you'll be able to save and invest to reach your financial goals.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Selena Maranjian owns shares of AbbVie, Amazon, AT&T, Ford, IBM, Johnson & Johnson, and Verizon Communications. The Motley Fool owns shares of and recommends Amazon and Etsy. The Motley Fool is short shares of IBM. The Motley Fool recommends 3M, Johnson & Johnson, and Verizon Communications and recommends the following options: long January 2020 $200 calls on IBM, short January 2020 $200 puts on IBM, and short January 2020 $155 calls on IBM. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Selena Maranjian owns shares of AbbVie, Amazon, AT&T, Ford, IBM, Johnson & Johnson, and Verizon Communications. Fortunately, that dire situation also means that every such dollar of debt that you retire will give you a guaranteed return, by letting you no longer have to pay interest on it. Buy dividend-paying stocks Broad-market index funds will generally feature dividend payments, but their yields won't usually be too hefty. | Selena Maranjian owns shares of AbbVie, Amazon, AT&T, Ford, IBM, Johnson & Johnson, and Verizon Communications. Here's some evidence of that, via Wharton Business School professor Jeremy Siegel, who calculated the average returns for stocks, bonds, bills, gold, and the dollar between 1802 and 2012: Source: Stocks for the Long Run, Jeremy Siegel. The table below shows just what a difference the annual growth rate makes to an annual investment of $10,000: Data source: Calculations by author. | Selena Maranjian owns shares of AbbVie, Amazon, AT&T, Ford, IBM, Johnson & Johnson, and Verizon Communications. "She works hard for the money So hard for it, honey She works hard for the money So you better treat her right" -- "She Works Hard for the Money," Donna Summer, from the 1983 album She Works Hard for the Money Most of us are used to working hard for our money. Annuities: If you take a large sum and buy one or more fixed annuities with it, you can set yourself up to receive monthly infusions of cash for the rest of your life, starting now or when you retire or even a certain number of years after you retire. | Selena Maranjian owns shares of AbbVie, Amazon, AT&T, Ford, IBM, Johnson & Johnson, and Verizon Communications. Carrying significant debt at high interest rates is a lot like investing -- in reverse. Invest in yourself Finally, a great way to put your money to work for you is to invest in yourself. |
24817.0 | 2019-11-13 00:00:00 UTC | Why Does AbbVie Pay a Much Higher Dividend Than Its Peers? | ABBV | https://www.nasdaq.com/articles/why-does-abbvie-pay-a-much-higher-dividend-than-its-peers-2019-11-13 | nan | nan | AbbVie (NYSE: ABBV) is a major drug manufacturer best known for its product, Humira, which treats arthritis, Crohn's disease, and plaque psoriasis. At 5.02%, the company's dividend yield is by far the highest among its branded drug peers, with GlaxoSmithKline being the next highest at 4.19%, followed by Pfizer at 3.89%.
While high dividend yields are great for investors who need income with minimal volatility, suspiciously high yields indicate that the market expects the dividend to fall or the stock to depreciate in the future. Is this a dividend stock to buy today?
AbbVie will have to figure out how to replace Humira
AbbVie holds patents in several countries for numerous applications for Humira, some of which have already begun to expire outside of the U.S. and will begin to expire domestically in 2023. Such a time frame is worrisome for investors because Humira provided 58% of the company's total revenue in the most recent quarter.
Image Source: Getty Images
Competition from generics is causing Humira's international revenue to decline year over year. This trend will continue as the patents expire over the next 15 years, with revenues dropping while legal and research and development expenses remain high. There are some prospective candidates in AbbVie's pipeline, such as Rinvoq, Imbruvica, Skyrizi, and Venclexta that may become blockbuster drugs. But it is always going to be difficult to replicate the financial success of a monster like Humira.
A major acquisition is the other big piece of this story
In June 2019, AbbVie announced an agreement to acquire Allergan (NYSE: AGN), maker of well-known Botox, for $63 billion. In the immediate aftermath, Allergan shares jumped 31%, while AbbVie fell 16%. The company cited scale, synergy, and a strong combined pipeline as the major motivating factors for the massive deal, with return on invested capital (ROIC) expected to exceed the cost of capital in the very first year following combination.
Theoretically, those are attractive economics that should lead to profit accretion in the medium or long term, and the company is forecasting between 7% and 10% revenue growth in the years following the merger, which would be double or triple the industry average.
Nonetheless, the market had some reservations with the merger at that price. AbbVie is paying a price-to-earnings multiple of nearly 50 to widen its pipeline, but it isn't acquiring any late-stage drugs that could approach the Humira level of financial returns. Some investors considered it a desperate move with substandard fundamentals.
Moreover, AbbVie carries around $38 billion in debt and lease obligations and has negative net shareholder equity. AbbVie announced that it would issue $28 billion to fund the cash portion of the Allergan acquisition, which would be one of the largest corporate bond deals in history. Increasing financial leverage, along with fixed debt servicing obligations with an impending patent cliff approaching, is going to scare some investors.
The combined entity will generate substantial free cash flow for the next few years, but the deal only makes sense if the new combined pipeline yields growth down the road and current forecasts don't instill much confidence that the company can replace Humira effectively in the near future.
How long can the dividend be maintained?
Management has been explicit about maintaining and growing the dividend, which has a strong history of increasing. However, since AbbVie's 2013 spinoff from Abbott Labs, the company has had Humira's incredible success to support that dividend growth. Growth from a more diversified base of drugs will be welcome, but several successful rollouts will be required to maintain the pace at the new scale. The dividend could be in jeopardy if revenue falters with this new capital structure.
AbbVie could be a very interesting story for investors who are seeking a high dividend yield to offset anticipated market weakness in the next two to three years. If a recession and market decline are indeed imminent, reduced exposure to equity volatility will be a goal for many, with stable dividend payers becoming more attractive. This dividend is likely to remain strong until 2023, after which there are plenty of question marks. That could be a compelling timeline, depending on an investor's macro outlook.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | A major acquisition is the other big piece of this story In June 2019, AbbVie announced an agreement to acquire Allergan (NYSE: AGN), maker of well-known Botox, for $63 billion. AbbVie is paying a price-to-earnings multiple of nearly 50 to widen its pipeline, but it isn't acquiring any late-stage drugs that could approach the Humira level of financial returns. AbbVie (NYSE: ABBV) is a major drug manufacturer best known for its product, Humira, which treats arthritis, Crohn's disease, and plaque psoriasis. | A major acquisition is the other big piece of this story In June 2019, AbbVie announced an agreement to acquire Allergan (NYSE: AGN), maker of well-known Botox, for $63 billion. AbbVie (NYSE: ABBV) is a major drug manufacturer best known for its product, Humira, which treats arthritis, Crohn's disease, and plaque psoriasis. AbbVie will have to figure out how to replace Humira AbbVie holds patents in several countries for numerous applications for Humira, some of which have already begun to expire outside of the U.S. and will begin to expire domestically in 2023. | AbbVie will have to figure out how to replace Humira AbbVie holds patents in several countries for numerous applications for Humira, some of which have already begun to expire outside of the U.S. and will begin to expire domestically in 2023. AbbVie could be a very interesting story for investors who are seeking a high dividend yield to offset anticipated market weakness in the next two to three years. AbbVie (NYSE: ABBV) is a major drug manufacturer best known for its product, Humira, which treats arthritis, Crohn's disease, and plaque psoriasis. | AbbVie is paying a price-to-earnings multiple of nearly 50 to widen its pipeline, but it isn't acquiring any late-stage drugs that could approach the Humira level of financial returns. AbbVie (NYSE: ABBV) is a major drug manufacturer best known for its product, Humira, which treats arthritis, Crohn's disease, and plaque psoriasis. AbbVie will have to figure out how to replace Humira AbbVie holds patents in several countries for numerous applications for Humira, some of which have already begun to expire outside of the U.S. and will begin to expire domestically in 2023. |
24818.0 | 2019-11-13 00:00:00 UTC | Should Investors Add Johnson & Johnson Stock to Their Shopping Lists? | ABBV | https://www.nasdaq.com/articles/should-investors-add-johnson-johnson-stock-to-their-shopping-lists-2019-11-13 | nan | nan | On Oct. 15, Johnson & Johnson (NYSE:), the healthcare giant, reported Q3 earnings and revenue that beat analysts’ average expectations. Yet, over the past 12 months, JNJ stock is down about 9%.
Source: Alexander Tolstykh / Shutterstock.com
Now many investors are wondering whether the company may end the year on a high note. In the next few weeks, I expect Johnson & Johnson shares to trade mostly between a range of $125 and $135. Long-term investors may view in the JNJ stock price as an opportunity to buy the shares.
Analyzing JNJ’s Recent Earnings
With a market cap of $347 billion, Johnson & Johnson, the healthcare giant, is currently . JNJ ‘s third-quarter revenue rose 1.9% year-over-year to $20.7 billion. Its earnings per share, excluding certain items, came in at $2.12, versus analysts’ average estimate of $2.01.
The company has a broad-based business model with a global reach. It operates in three segments that provide it with diversified sources of revenue, earnings and cash flow:
JNJ’s markets treatments for immunology, cardiovascular and metabolic diseases, pulmonary hypertension, infectious diseases and cancer.
Several of its well-known consumer brands include Aveeno, Band-Aid, Johnson’s Baby, Listerine, Neutrogena, Rogaine, Tylenol and Zyrtec.
Finally,its medical devices business develops and markets products and solutions for surgery, orthopedics, and vision.
Although about 60% of Johnson &Johnson’s revenue is U.S.-based, its overseas operations in general and its emerging market businesses in particular are proving to be important growth catalysts for JNJ.
The Legal Woes of Johnson & Johnson
Pharmaceutical industry firms often . At present, Johnson & Johnson is facing literally thousands of lawsuits.
For example, in the summer, the Federal Trade Commission issued to the company in an effort to determine whether JNJ had violated antitrust laws with Remicade, its rheumatoid arthritis drug.
In August, Johnson and Johnson made the news when an Oklahoma judge found helping to fuel the state’s opioid crisis by aggressively marketing painkillers. JNJ is also facing various lawsuits regarding its talc-based baby powder.
Theresa Gabaldon of George Washington University Law School discusses in detail the “ballooning of pharmaceutical advertising with correlative increases in the prescriptions written for various mental and other ailments” within the industry.
Professor Gabaldon further states that “Purdue Pharma led off in the 1990s by heavily advertising OxyContin as non-addictive—a claim that clearly was untrue.” (NYSE:ABBV), Johnson & Johnson, and Pfizer (NYSE:) “also conducted aggressive advertising campaigns for their proprietary opioids. These campaigns, which were directed at physicians, resulted in $11 billion from opioid sales alone in 2010.”
In the long-run, lawsuits and fines do not necessarily dent the fundamental metrics of pharma companies much. However, in the short-term, investors understandably get spooked by the uncertainty created by lawsuits.
Other Long-Term Factors to Consider
One of the challenges faced by JNJ and other drug companies is falling sales as the patents of blockbuster drugs expire, enabling much cheaper, competing generic drugs to be sold.
Therefore, the pressure to innovate and diversify is part of the reality of managing a global pharma leader like Johnson & Johnson. And in JNJ’s case, diversification has been the company’s competitive advantage. As one segment faces headwinds, the others usually help propel the company forward.
The forward price-earnings ratio of JNJ stock stands at 14.5 and is lower than many of its peers. Many investors would cbe comfortable paying more than that for a strong business like Johnson & Johnson.
Meanwhile, Johnson & Johnson stock also has a dividend yield of 2.9%. The conglomerate has raised its dividend each year for over half a century. And dividends tend to create a “price floor” for coveted stocks such as JNJ.
What Technical Charts Indicate
No investor has a crystal ball that can predict the markets’ next move. However, analyzing the recent price action of JNJ stock may give us an indication of what to expect in the weeks ahead.
In 2019 JNJ stock has fallen 1.6%. Its 52-week range has been $121.00 (Dec. 24, 2018) – $148.99 (Dec. 4, 2018).
JNJ’s short-term charts are painting a mixed picture and suggest that JNJ stock is likely to trade within a range. While long-term investors would like to see JNJ stock stay over $135, short-term traders are likely to keep the shares between $125 and $135.
I do not expect Johnson & Johnson stock to reach any new highs until we have more clarity on the full ramification of several of its legal challenges.
In recent weeks, the stock has found support around the $125 level. Therefore, I’d consider buying the shares if they fall toward or even below first $125 and then $120.
The Bottom Line on JNJ Stock
The company’s diversification enables JNJ stock to withstand economic cycles more effectively. No matter what the economy does, consumers will buy the products of many of its strong brands, and Johnson & Johnson will likely have industry-leading market share in many areas.
I remain bullish on the long-term outlook of Johnson and Johnson stock. However, in the short-term, JNJ might exhibit weakness.
Therefore, investors may consider staying on the sidelines on JNJ if they do not currently have a position in the shares.
Alternatively, investors who already own the shares may consider hedging their positions. As for hedging strategies, covered calls with a Jan. 17 expiry could be appropriate.
Finally, any short-term decline in these shares may create better entry points for long-term investors who do not yet own JNJ stock.
As of this writing, Tezcan Gecgil hold PFE covered calls (Nov. 15 expiry).
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Professor Gabaldon further states that “Purdue Pharma led off in the 1990s by heavily advertising OxyContin as non-addictive—a claim that clearly was untrue.” (NYSE:ABBV), Johnson & Johnson, and Pfizer (NYSE:) “also conducted aggressive advertising campaigns for their proprietary opioids. For example, in the summer, the Federal Trade Commission issued to the company in an effort to determine whether JNJ had violated antitrust laws with Remicade, its rheumatoid arthritis drug. Theresa Gabaldon of George Washington University Law School discusses in detail the “ballooning of pharmaceutical advertising with correlative increases in the prescriptions written for various mental and other ailments” within the industry. | Professor Gabaldon further states that “Purdue Pharma led off in the 1990s by heavily advertising OxyContin as non-addictive—a claim that clearly was untrue.” (NYSE:ABBV), Johnson & Johnson, and Pfizer (NYSE:) “also conducted aggressive advertising campaigns for their proprietary opioids. On Oct. 15, Johnson & Johnson (NYSE:), the healthcare giant, reported Q3 earnings and revenue that beat analysts’ average expectations. Analyzing JNJ’s Recent Earnings With a market cap of $347 billion, Johnson & Johnson, the healthcare giant, is currently . | Professor Gabaldon further states that “Purdue Pharma led off in the 1990s by heavily advertising OxyContin as non-addictive—a claim that clearly was untrue.” (NYSE:ABBV), Johnson & Johnson, and Pfizer (NYSE:) “also conducted aggressive advertising campaigns for their proprietary opioids. Analyzing JNJ’s Recent Earnings With a market cap of $347 billion, Johnson & Johnson, the healthcare giant, is currently . Although about 60% of Johnson &Johnson’s revenue is U.S.-based, its overseas operations in general and its emerging market businesses in particular are proving to be important growth catalysts for JNJ. | Professor Gabaldon further states that “Purdue Pharma led off in the 1990s by heavily advertising OxyContin as non-addictive—a claim that clearly was untrue.” (NYSE:ABBV), Johnson & Johnson, and Pfizer (NYSE:) “also conducted aggressive advertising campaigns for their proprietary opioids. In the next few weeks, I expect Johnson & Johnson shares to trade mostly between a range of $125 and $135. Long-term investors may view in the JNJ stock price as an opportunity to buy the shares. |
24819.0 | 2019-11-13 00:00:00 UTC | Noteworthy ETF Outflows: IYH, MRK, PFE, ABBV | ABBV | https://www.nasdaq.com/articles/noteworthy-etf-outflows%3A-iyh-mrk-pfe-abbv-2019-11-13 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares U.S. Healthcare ETF (Symbol: IYH) where we have detected an approximate $40.0 million dollar outflow -- that's a 1.9% decrease week over week (from 10,350,000 to 10,150,000). Among the largest underlying components of IYH, in trading today Merck & Co Inc (Symbol: MRK) is up about 0.4%, Pfizer Inc (Symbol: PFE) is off about 0.8%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.1%. For a complete list of holdings, visit the IYH Holdings page » The chart below shows the one year price performance of IYH, versus its 200 day moving average:
Looking at the chart above, IYH's low point in its 52 week range is $169.96 per share, with $203.10 as the 52 week high point — that compares with a last trade of $199.90. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of IYH, in trading today Merck & Co Inc (Symbol: MRK) is up about 0.4%, Pfizer Inc (Symbol: PFE) is off about 0.8%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.1%. For a complete list of holdings, visit the IYH Holdings page » The chart below shows the one year price performance of IYH, versus its 200 day moving average: Looking at the chart above, IYH's low point in its 52 week range is $169.96 per share, with $203.10 as the 52 week high point — that compares with a last trade of $199.90. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of IYH, in trading today Merck & Co Inc (Symbol: MRK) is up about 0.4%, Pfizer Inc (Symbol: PFE) is off about 0.8%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.1%. For a complete list of holdings, visit the IYH Holdings page » The chart below shows the one year price performance of IYH, versus its 200 day moving average: Looking at the chart above, IYH's low point in its 52 week range is $169.96 per share, with $203.10 as the 52 week high point — that compares with a last trade of $199.90. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). | Among the largest underlying components of IYH, in trading today Merck & Co Inc (Symbol: MRK) is up about 0.4%, Pfizer Inc (Symbol: PFE) is off about 0.8%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.1%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares U.S. Healthcare ETF (Symbol: IYH) where we have detected an approximate $40.0 million dollar outflow -- that's a 1.9% decrease week over week (from 10,350,000 to 10,150,000). For a complete list of holdings, visit the IYH Holdings page » The chart below shows the one year price performance of IYH, versus its 200 day moving average: Looking at the chart above, IYH's low point in its 52 week range is $169.96 per share, with $203.10 as the 52 week high point — that compares with a last trade of $199.90. | Among the largest underlying components of IYH, in trading today Merck & Co Inc (Symbol: MRK) is up about 0.4%, Pfizer Inc (Symbol: PFE) is off about 0.8%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.1%. For a complete list of holdings, visit the IYH Holdings page » The chart below shows the one year price performance of IYH, versus its 200 day moving average: Looking at the chart above, IYH's low point in its 52 week range is $169.96 per share, with $203.10 as the 52 week high point — that compares with a last trade of $199.90. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). |
24820.0 | 2019-11-13 00:00:00 UTC | AbbVie Reaches Analyst Target Price | ABBV | https://www.nasdaq.com/articles/abbvie-reaches-analyst-target-price-2019-11-13 | nan | nan | In recent trading, shares of AbbVie Inc (Symbol: ABBV) have crossed above the average analyst 12-month target price of $86.14, changing hands for $86.44/share. When a stock reaches the target an analyst has set, the analyst logically has two ways to react: downgrade on valuation, or, re-adjust their target price to a higher level. Analyst reaction may also depend on the fundamental business developments that may be responsible for driving the stock price higher — if things are looking up for the company, perhaps it is time for that target price to be raised.
There are 7 different analyst targets contributing to that average for AbbVie Inc, but the average is just that — a mathematical average. There are analysts with lower targets than the average, including one looking for a price of $74.00. And then on the other side of the spectrum one analyst has a target as high as $96.00. The standard deviation is $7.581.
But the whole reason to look at the average ABBV price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with ABBV crossing above that average target price of $86.14/share, investors in ABBV have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $86.14 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? Below is a table showing the current thinking of the analysts that cover AbbVie Inc:
The average rating presented in the last row of the above table above is from 1 to 5 where 1 is Strong Buy and 5 is Strong Sell. This article used data provided by Zacks Investment Research via Quandl.com. Get the latest Zacks research report on ABBV — FREE.
The Top 25 Broker Analyst Picks of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In recent trading, shares of AbbVie Inc (Symbol: ABBV) have crossed above the average analyst 12-month target price of $86.14, changing hands for $86.44/share. But the whole reason to look at the average ABBV price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with ABBV crossing above that average target price of $86.14/share, investors in ABBV have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $86.14 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? | In recent trading, shares of AbbVie Inc (Symbol: ABBV) have crossed above the average analyst 12-month target price of $86.14, changing hands for $86.44/share. But the whole reason to look at the average ABBV price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with ABBV crossing above that average target price of $86.14/share, investors in ABBV have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $86.14 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? | There are 7 different analyst targets contributing to that average for AbbVie Inc, but the average is just that — a mathematical average. And so with ABBV crossing above that average target price of $86.14/share, investors in ABBV have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $86.14 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? In recent trading, shares of AbbVie Inc (Symbol: ABBV) have crossed above the average analyst 12-month target price of $86.14, changing hands for $86.44/share. | There are 7 different analyst targets contributing to that average for AbbVie Inc, but the average is just that — a mathematical average. In recent trading, shares of AbbVie Inc (Symbol: ABBV) have crossed above the average analyst 12-month target price of $86.14, changing hands for $86.44/share. But the whole reason to look at the average ABBV price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. |
24821.0 | 2019-11-13 00:00:00 UTC | Amarin's Stock Could Reach $50 Per Share Soon | ABBV | https://www.nasdaq.com/articles/amarins-stock-could-reach-%2450-per-share-soon-2019-11-13 | nan | nan | Yesterday, Amarin's (NASDAQ: AMRN) shares jumped by a whopping 20.9% during normal trading hours. The spark behind this eye-catching move northward was the release of the U.S. Food and Drug Administration's (FDA) briefing materials for the company's upcoming advisory-committee meeting set for this Thursday.
Come Thursday, Amarin and the FDA's panel of experts will mull over the putative cardioprotective benefits of the company's prescription omega-3 treatment known as Vascepa. The big deal is that Vascepa's addressable market would expand to upwards of around 9.5 million Americans who are currently on statin therapy but still suffer from elevated triglyceride levels.
Image Source: Getty Images.
That's a $15 billion per-year commercial opportunity right now -- based on the drug's estimated annual net price of $1,625, per the cost-effectiveness watchdog ICER. Future price hikes, combined with the continued growth of this target market as a whole, though, could push Vascepa's sales into truly rarefied air.
Keeping with this theme, Vascepa has the potential to generate annual sales larger than those of Pfizer's (NYSE: PFE) megablockbuster cholesterol medicine Lipitor, as well as AbbVie's anti-inflammatory behemoth Humira. For those new to the world of biopharma, Lipitor and Humira are the two bestselling pharmaceutical products of all time. That's just how big of a deal Vascepa's proposed cardioprotective indication is from a commercial standpoint.
With this background in mind, it's arguably the perfect time to consider if Amarin's stock can climb even higher in the days and weeks ahead. Here's a look at Amarin's potential risks and rewards in light of yesterday's market-moving event.
Amarin: The risks and rewards
Amarin's stock sports two clear-cut risk factors: the regulatory risk associated with Vascepa's proposed label expansion and the company's real world ability to fully capitalize on this ginormous commercial opportunity, post-approval.
Now, the risk emanating from the upcoming label-expansion decision appears to be minimal in the wake of yesterday's briefing-document release. The most critical issue heading into this advisory-committee meeting was the potentially confounding effect of the mineral oil placebo on the magnitude of Vascepa's observed cardioprotective benefit in the Reduce-It trial. However, the FDA's own reviewers admitted that they couldn't explain away Vascepa's cardioprotective benefit simply as a function of a non-inert placebo.
Two key statements in the briefing documents made this point crystal clear:
FDA analyses attempting to differentiate whether increases in LDL-C and other biomarkers were due to the mineral oil placebo are inconclusive...
FDA's exploratory analyses to assess the effect of these markers suggested that the difference in LDLC between the study groups could not account for the positive CV outcomes.
So, unless something truly extraordinary happens at Thursday's meeting, the FDA will more than likely approve Vascepa's label expansion.
Amarin's key risk thus boils down to the company's ability to maximize Vascepa's commercial potential. Although Amarin is planning on significantly beefing up its sales force once the FDA formally approves this label expansion, the reality of the situation is that the company simply cannot tackle this vast market by itself.
Amarin doesn't have the commercial infrastructure or the marketing clout to cover all the bases, so to speak. There's an inherent structure reason, after all, why all the bestselling drugs in the world are either marketed directly by a pharma titan or at least partnered with one of the industry's biggest names.
What this means is that Vascepa's peak sales would probably top out at the $2 billion mark under a go-it-alone approach and could take several years to reach this high-water mark. In that case, Amarin's shares would arguably be fairly valued at something along the lines of $27.8 per share (five times peak sales), representing a 33% upside potential from current levels.
For the uber-bulls out there, the plain truth is that Amarin's shares would almost certainly be trading at much higher levels if the market thought the company could realistically push Vascepa's sales significantly beyond the $2 billion mark within the next four years. So $2 billion does appear to be the market's working peak sales estimate -- at least as things stand now.
The wildcard
There is a wildcard at play here, however. Amarin's management hasn't even attempted to build out a broader clinical pipeline to complement Vascepa, and that's a big tell in regards to the company's value-creation strategy. Cutting to the chase, Amarin has probably already fielded a few tender offers in the event the FDA greenlights Vascepa's Reduce-It indication.
Amgen (NASDAQ: AMGN) and Pfizer have both been rumored to have interest in Amarin in the recent past, after all. Making this situation even more intriguing is that both Amgen and Pfizer have been been gobbling up high-value assets of late in order to finally move beyond the patent cliff. Vascepa, for its part, could turn into a crown jewel of the pharma industry under the umbrella of either Amgen or Pfizer, making it a highly desirable asset for these titans of the industry.
How much could Amarin fetch in a buyout? With two gold-star players vying for Vascepa, Amarin's buyout price could easily range from $36 to $42 per share (assuming a tender offer in the range of $13 billion to $15 billion). Now, if a bidding war broke out -- a scenario that played out when AbbVie had to pay top dollar to acquire Imbruvica, the low $50s might even be possible.
When would a buyout most likely occur? Big pharma has a tendency to announce needle-moving business development moves early in the year -- frequently in January around the time of the J.P. Morgan Healthcare Conference. The reason is that these early-year announcements help to set the stage for investors' expectations for the full year.
Final thoughts
The big picture is that investors shouldn't be surprised if Amarin indeed gets this all-important label expansion for Vascepa before the end of the year, and this regulatory win, in turn, leads to a buyout at a healthy premium within the first quarter of 2020. From a more conservative viewpoint, Amarin's shares should at least appreciate by another 10% to 20% before the end of 2019, especially with its biggest risk factor -- a complete response letter -- seemingly off the table.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Keeping with this theme, Vascepa has the potential to generate annual sales larger than those of Pfizer's (NYSE: PFE) megablockbuster cholesterol medicine Lipitor, as well as AbbVie's anti-inflammatory behemoth Humira. Now, if a bidding war broke out -- a scenario that played out when AbbVie had to pay top dollar to acquire Imbruvica, the low $50s might even be possible. For the uber-bulls out there, the plain truth is that Amarin's shares would almost certainly be trading at much higher levels if the market thought the company could realistically push Vascepa's sales significantly beyond the $2 billion mark within the next four years. | Keeping with this theme, Vascepa has the potential to generate annual sales larger than those of Pfizer's (NYSE: PFE) megablockbuster cholesterol medicine Lipitor, as well as AbbVie's anti-inflammatory behemoth Humira. Now, if a bidding war broke out -- a scenario that played out when AbbVie had to pay top dollar to acquire Imbruvica, the low $50s might even be possible. Amarin: The risks and rewards Amarin's stock sports two clear-cut risk factors: the regulatory risk associated with Vascepa's proposed label expansion and the company's real world ability to fully capitalize on this ginormous commercial opportunity, post-approval. | Keeping with this theme, Vascepa has the potential to generate annual sales larger than those of Pfizer's (NYSE: PFE) megablockbuster cholesterol medicine Lipitor, as well as AbbVie's anti-inflammatory behemoth Humira. Now, if a bidding war broke out -- a scenario that played out when AbbVie had to pay top dollar to acquire Imbruvica, the low $50s might even be possible. Amarin: The risks and rewards Amarin's stock sports two clear-cut risk factors: the regulatory risk associated with Vascepa's proposed label expansion and the company's real world ability to fully capitalize on this ginormous commercial opportunity, post-approval. | Keeping with this theme, Vascepa has the potential to generate annual sales larger than those of Pfizer's (NYSE: PFE) megablockbuster cholesterol medicine Lipitor, as well as AbbVie's anti-inflammatory behemoth Humira. Now, if a bidding war broke out -- a scenario that played out when AbbVie had to pay top dollar to acquire Imbruvica, the low $50s might even be possible. Here's a look at Amarin's potential risks and rewards in light of yesterday's market-moving event. |
24822.0 | 2019-11-12 00:00:00 UTC | 7 Biotech Stocks to Buy With Plenty of Power in the Pipeline | ABBV | https://www.nasdaq.com/articles/7-biotech-stocks-to-buy-with-plenty-of-power-in-the-pipeline-2019-11-12 | nan | nan | As market conditions turn positive again and the major indices close at a new high, value investors should turn to the healthcare sector. Biotechnology stocks are far from their 52-week highs. And even though worries over pressured drug prices are dissipating, biotech stocks did not fully rebound.
Investors should look for two key aspects with biotech stocks. They should pick companies that already have products on the market and whose profits more than cover research spending. They should also demand companies with plenty in the pipeline. With those requirements, companies are unlikely to seek an additional cash boost through the sale of shares. That gives investors the biggest upside potential with the least amount of risk.
Here are seven biotech stocks with plenty in the pipeline to consider.
Biotech Stocks to Buy: Biogen (BIIB)
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Biogen (NASDAQ:) shares languished through much of 2019 when the company abruptly canceled its Alzheimer’s drug. On Oct. 22, that changed. The company reviewed the clinical data again and decided the drug does work. Its terminated Phase 3 Emerge study met the primary endpoint. At week 78, it showed a statistically significant decline as measured by the CDR-SB scale. Greater exposure to its drug aducanumab led to a 23% clinical reduction compared to the placebo.
In its third-quarter report, Biogen reported a 17% growth in Spinraza sales, a 3% increase in Tecfidera and a 3% increase in Tysabri sales year-over-year. It continued to progress its pipeline with Vemerity and the addition of two new clinical programs. Its pipeline for multiple sclerosis drugs continued growing in the third quarter. Positive results for one of its studies on multiple sclerosis suggest strong product sales in the future.
Adding BIIB094 to its pipeline will advance its antisense oligonucleotide (or ASO) for targeting the most common genetic cause of Parkinson’s disease. It will further build depth across its ASO pipeline by focusing on genetically validated targets.
Overall, the plan to gain approval for its Alzheimer’s disease therapy is a historic milestone for Biogen and for those who suffer from it. After growing revenue by 5% to $3.6 billion in Q3, growth rates will remain steady as new drugs come to the market.
AbbVie (ABBV)
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AbbVie (NYSE:) stock recently began trading above $80 for the first time since May. The company not only reported a strong third quarter but it declared a $1.18 dividend. This is 10% higher than previous payments and undermines the bearishness that followed its Allergan (NYSE:) buyout.
Allergan’s product portfolio, especially the Botox lineup, broadens AbbVie’s pipeline of drugs. Although its blockbuster drug Humira faced generic competition, it still grew sales by 9.5% in the U.S. in the third quarter. It reported strong volume growth across all three segments: rheumatology, dermatology and gastroenterology.
AbbVie advanced its pipeline with recent product Rinvoq. A phase 3 study in axial spondyloarthritis next may expand the drug’s market within the rheumatology segment. In atopic dermatitis, Rinvoq results will be posted in the first half of 2020.
In hematologic oncology, Imbruvica and Venclexta are advancing its product pipeline. Expect favorable study updates to give ABBV stock another lift.
In Q3, AbbVie’s earnings per share grew 8.9% to $2.33 as revenue grew 3.5%. The company managed its mature product line and will have more than enough cash flow to grow its dividend and service the debt incurred through the Allergan buyout.
Innoviva (INVA)
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Innoviva (NASDAQ:) stock topped $20 at the beginning of 2019 only to fall to $10.03. The stock rebounded by 20% in recent weeks after reporting a strong third quarter. Innoviva’s EPS was 36 cents as revenue rose to $65.8 million.
The company reported gross royalty revenue of $69.2 million from GlaxoSmithKline (NYSE:), which included royalties of $46.4 million from global net sales of Relvar. Royalty revenue for Anora Ellipta was $11.6 million.
Generic versions of Advair, another asthma treatment, will continue to be a drag on results. But Innoviva lowered its operating costs by reducing its office space.
Looking ahead, the company may offset the 10% drop in Relvar sales with a continued increase in Anora Ellipta sales. To do that, it needs to grow sales in non-U.S. markets.
Last month, GSK a filing to U.S. Food and Drug Administration for Trelegy Ellipta use in patients with asthma. If the new drug is approved, this would make it the first and only single-inhaler triple therapy that’s available for both asthma and chronic obstructive pulmonary disease (COPD) in the United States. The expanded market improves the revenue potential for the company’s existing pipeline.
Theravance Biopharma (TBPH)
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Theravance Biopharma (NASDAQ:) and Innoviva used to be a single company, but when the two firms split, the biopharma unit led drug discovery initiatives. Theravance is building a pipeline of drugs that treat single-organ diseases. It differentiates itself from other biotech firms by carrying out difficult-to-replicate design characteristics. This gives it a sustainable competitive advantage.
Theravance Biopharma has research and development efforts that will accelerate pivotal studies, including TD-1473 and ampreloxetine. It ended the with $352.9 million in cash as of Sep. 30. So, it has enough to fund its R&D activities.
For the full-year 2019, the company forecast a lower operating loss in the range of $200 million to $210 million. The lower loss guidance is due to upfront payments from Mylan (NASDAQ:) for Yupelri development and commercialization rights in China.
In its early stage pipeline, TD-8236 a Phase 1 study. With both healthy volunteers and patients with asthma, the study included a biomarker evaluation in patients who have the active disease. The company posted generally good tolerance as a single dose and as a once-daily dose for those with mild asthma. The results validate drug safety and tolerability, pharmacokinetics and preliminary pharmacodynamics activity.
The company initiated a Part C extension portion of the Phase 1 trial that will assess a range of more biomarkers in patients with more severe asthma.
TBPH stock may have bottomed at $16 and could potentially rebound back to the $20 level as the market gains confidence in the company’s product development.
Regeneron (REGN)
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Regeneron Pharmaceuticals (NASDAQ:) stock rallied by around 8% on Nov. 5 after reporting strong earnings. Its two blockbuster drugs, Dupixent and Eylea, beat consensus estimates. The company has clear cash flow growth ahead of these products. This will fund the company’s oncology studies.
In the third quarter, Regeneron reported Eylea sales of $1.9 billion, 14% above last year’s levels. Sales beat consensus estimates because the level of generic competition is not as high some predicted.
The real highlight in the company’s quarter was Dupixent’s quarterly sales. Sales more than doubled to $633.1 million. An expanded indication for the drug for treating adolescent and pediatric atopic dermatitis will lead to significantly stronger sales in the years ahead.
To broaden its business and pipeline, the company continued development in drugs treating cancer. On Nov. 5, the company updates to its ongoing Phase 3 development program evaluating Libtayo. This is a PD-1 inhibitor and is a monotherapy and combination therapy in first-line patients with advanced non-small cell lung cancer (NSCLC). This study enrolled 90% of the 700 planned patients. Once it achieves full enrollment by the end of this year, it will start the study with 361 randomized patients with a minimum of 6 months of follow-up.
The second trial will have two parts that evaluate Libtayo in combination with platinum-based chemotherapy. Part 1 evaluates patients with PD-L1 expression. And Part 2 is a Phase 3 trial that evaluates patients with all PD-L1 expression levels in two treatment groups: chemotherapy alone or chemotherapy in combination with Libtayo.
At the time of writing, REGN stock is still a paper loss year-to-date. As markets catch on to the growth prospects for Regeneron, look for the stock to outperform its peers.
Mylan (MYL)
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Mylan stock is more than half price and is still struggling on the market. On Nov. 5, it reported third-quarter revenue growing 3.5% to $3 billion. Non-GAAP EPS was $1.17 while GAAP EPS was 37 cents. Still, the company has areas of strength that suggest its core business is stabilizing.
Mylan’s North American segment reported net sales of $1.1 billion, up 8%. Its European segment was steady, with net sales up below 1%. In Q3, adjusted free cash flow of $542 million brought the year-to-date total to $1.3 billion. And with a $1.9 billion to $2.3 billion FCF forecast for the full-year 2019, Mylan will continue paying off its debt. In Q3, it repaid around $650 million of debt. It plans to pay back $1.1 billion of debt for 2019.
Mylan’s 2019 EPS will be in the range of $4.20 to $4.40.
Mylan is simplifying its business by merging its off-patent branded drugs with Pfizer’s (NYSE:) Upjohn unit. Impatient investors also fretted over Mylan’s caution of a decline in revenue. Still, Wixela and Yupelri, which treats respiratory ailments, are new drugs that contributed to the 8% sale rise. But for the full year, Wixela sales will fall short of estimates.
If investors bet that the short-term hiccup in sales for new products is temporary, then MYL stock may recover as revenue growth resumes in 2020 and beyond.
Novartis (NVS)
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Novartis (NYSE:NVS) is having trouble trading above the $95 level. But last month, the stock resumed its uptrend after receiving an FDA approval for Beovu and reporting Q3 results.
Novartis a 9% sales growth from its oncology unit. It has many drugs in the pipeline driving that growth. At the European Society for Medical Oncology conference, abstracts were accepted and 13 Novartis brands or compounds with data were presented. The company highlighted Monaleesa-3, which is the second Phase 3 trial in which Kisqali demonstrated a statistically significant overall survival benefit of around 30%.
The FDA also approved Beovu, which will offer wet macular degeneration patients and greater fluid reductions through aflibercept. This approval may have contributed to the drop in REGN stock. For diversification, investors may hold both REGN and NVS stock.
In the third , Novartis reported double-digit top and bottom-line growth. The company highlighted Beovu’s launch in the U.S., Cosentyx meeting primary endpoints and positive results from the Kisqali and Entresto studies. These will all deepen the company’s drug pipeline. In the near term, Novartis may count on its key growth drivers of more than 10 drugs that contribute to 28% of its sales growth.
China is another opportunity for Novartis. In the last two years, it had 24 new drug applications approved. And between now and 2023, it expects to have 50 new drug application submissions. Growth rates in the region are in the high 20% level. So, expect Entresto, Lucentis and Cosentyx to lead that sales growth.
As of this writing, Chris Lau owned ABBV and INVA stock.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com AbbVie (NYSE:) stock recently began trading above $80 for the first time since May. Allergan’s product portfolio, especially the Botox lineup, broadens AbbVie’s pipeline of drugs. AbbVie advanced its pipeline with recent product Rinvoq. | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com AbbVie (NYSE:) stock recently began trading above $80 for the first time since May. Allergan’s product portfolio, especially the Botox lineup, broadens AbbVie’s pipeline of drugs. AbbVie advanced its pipeline with recent product Rinvoq. | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com AbbVie (NYSE:) stock recently began trading above $80 for the first time since May. Allergan’s product portfolio, especially the Botox lineup, broadens AbbVie’s pipeline of drugs. AbbVie advanced its pipeline with recent product Rinvoq. | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com AbbVie (NYSE:) stock recently began trading above $80 for the first time since May. Allergan’s product portfolio, especially the Botox lineup, broadens AbbVie’s pipeline of drugs. AbbVie advanced its pipeline with recent product Rinvoq. |
24823.0 | 2019-11-12 00:00:00 UTC | Why Shares of Reata Pharmaceuticals Rocketed More Than 150% in October | ABBV | https://www.nasdaq.com/articles/why-shares-of-reata-pharmaceuticals-rocketed-more-than-150-in-october-2019-11-12 | nan | nan | What happened
Shares of biopharma company Reata Pharmaceuticals (NASDAQ: RETA) climbed 156.7% in October, according to data from S&P Global Market Intelligence. Shares had been stagnant since January.
So what
Reata's big month came in three stages. First, shares increased by a modest 13% after the company announced it was buying back the rights to develop, produce, and market a series of next-generation Nrf2 activators, including bardoxolone and omaveloxolone. Nrf2 is a protein that regulates antioxidant production and helps prevent cell damage. The rights had formerly been licensed to Reata's partner AbbVie.
A top drug class has been the gift that keeps on giving for Reata. Image source: Getty Images.
But the big jump -- 57% -- came on Oct. 14, when Reata announced the positive top-line results of a midstage trial involving one of those drugs, omaveloxolone, and its potential to treat Friedreich's ataxia, a neurodegenerative disease caused by abnormally low levels of a protein called frataxin. Nobody is sure what frataxin's function is in the body, but it's prevalent in the kidney, liver, and heart and seems to be related to the body's assembly of iron-sulfur clusters. In the trial, patients treated with omaveloxolone over 48 weeks saw statistically significant benefits compared with those who took a placebo.
The results were particularly significant because Friedreich's ataxia currently has no approved treatment for slowing the progression of the disease. Over the next several days, as the market digested this news, Reata's shares rose an additional 30.5% for a total gain of 156.7% for the month.
Now what
The next step for Reata, of course, is to try to get omaveloxolone approved by the FDA and other regulatory agencies as a treatment for Friedreich's ataxia. Given the lack of any current approved treatment, swift action would seem likely, but of course, there's no guarantee.
For investors looking for big gains from pharmaceutical stocks, the ship has probably sailed as far as this particular drug and this particular disease are concerned. Yes, full FDA approval would probably boost shares a bit further, but they've already gone up so much that the biggest gains are almost certainly in the rearview mirror.
However, it's worth noting that Reata has now had two recent successes with this drug class: On Nov. 11, the company reported positive results from a phase 3 trial of bardoxolone to treat chronic kidney disease caused by Alport syndrome. The stock barely budged in response.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The rights had formerly been licensed to Reata's partner AbbVie. First, shares increased by a modest 13% after the company announced it was buying back the rights to develop, produce, and market a series of next-generation Nrf2 activators, including bardoxolone and omaveloxolone. But the big jump -- 57% -- came on Oct. 14, when Reata announced the positive top-line results of a midstage trial involving one of those drugs, omaveloxolone, and its potential to treat Friedreich's ataxia, a neurodegenerative disease caused by abnormally low levels of a protein called frataxin. | The rights had formerly been licensed to Reata's partner AbbVie. What happened Shares of biopharma company Reata Pharmaceuticals (NASDAQ: RETA) climbed 156.7% in October, according to data from S&P Global Market Intelligence. However, it's worth noting that Reata has now had two recent successes with this drug class: On Nov. 11, the company reported positive results from a phase 3 trial of bardoxolone to treat chronic kidney disease caused by Alport syndrome. | The rights had formerly been licensed to Reata's partner AbbVie. But the big jump -- 57% -- came on Oct. 14, when Reata announced the positive top-line results of a midstage trial involving one of those drugs, omaveloxolone, and its potential to treat Friedreich's ataxia, a neurodegenerative disease caused by abnormally low levels of a protein called frataxin. 10 stocks we like better than Reata Pharmaceuticals When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. | The rights had formerly been licensed to Reata's partner AbbVie. But the big jump -- 57% -- came on Oct. 14, when Reata announced the positive top-line results of a midstage trial involving one of those drugs, omaveloxolone, and its potential to treat Friedreich's ataxia, a neurodegenerative disease caused by abnormally low levels of a protein called frataxin. The results were particularly significant because Friedreich's ataxia currently has no approved treatment for slowing the progression of the disease. |
24824.0 | 2019-11-11 00:00:00 UTC | 7 Great High-Yield Stocks With Payouts Over 5% | ABBV | https://www.nasdaq.com/articles/7-great-high-yield-stocks-with-payouts-over-5-2019-11-11 | nan | nan | In May, I recommended seven dividend stocks worth owning that were yielding 5% or more. In August, I gave the a bit of a refresh.
Now, with the S&P 500 on the verge of its since 2013, and only the fourth time in the past 20 years that the index has finished above 20%, I thought I’d pick an entirely new crop of high-yielding dividend stocks.
It’s not as easy as it looks to pick high-yield dividend stocks because they’re often yielding more than 5% for a reason. Something about the company or industry has broken down, pushing the stock price lower and the yield higher.
However, that doesn’t mean good buys aren’t out there. It just means you have to be a little more selective about the ones you do choose to buy.
As I’ve said, I’m going to pick an entirely new crop. To keep things interesting, I’ll do my best to include one stock from seven different sectors.
High-Yield Stocks to Buy: Rio Tinto (RIO)
Source: Shutterstock
In 2018, Rio Tinto (NYSE:) paid total dividends of $3.08 a share, 30% higher than the $2.37 it paid out a year earlier. In April, it paid out $1.80 in regular dividends and $2.43 in special dividends. In September, it paid $1.51 in regular dividends and 61 cents in special dividends. The special dividends were the result of in 2019.
If you held the metals and minerals producer’s stock for the entire year, you would have received $6.35 in dividends per ADR, a yield of 11.4% based on its Nov. 6 closing price of $55.66.
Rio Tinto CEO Jean-Sebastian Jacques recently told a roomful of miners that the industry needed to step up its environmental, social and governance (ESG) game in a world where climates are changing at a drastic pace.
“Lots of people are talking about it, but I’m not sure there is action,” Jacques told the London audience.
That’s courageous talk from the leader of one of the companies that will shape how the industry operates 20-30 years from now.
One possibility Rio Tinto’s CEO mentioned at the London conference was the creation of an app that would allow its customers to see how much carbs emitted from the products they buy.
The mining industry isn’t known for full disclosure. Jacques’ approach suggests his company will play a big part in that changing.
In the meantime, enjoy the attractive dividend yield.
Tapestry (TPR)
Source: Hi-Point / Shutterstock.com
Tapestry (NYSE:) stock is down 20.2% year to date, including dividends through Nov. 6. Over the past 52 weeks, owners of Tapestry stock have a total “return” of -33.8%.
The company was once known as Coach. Then it in July 2017 for $2.4 billion, changed its name to Tapestry to reflect the holding company nature of its business, and all hell has broken loose.
Since Tapestry closed the deal, TPR stock has lost 46% of its value. Talk about value destruction.
However, as Tapestry CEO Jide Zeitlin commented in its Q1 2020 conference call on Nov. 5, of its stock in the first quarter. Combined with the annual dividend of $1.35 a share, it plans to return $700 million to its shareholders in the coming fiscal year.
Tapestry is currently yielding 5.2%,
While its first-quarter results weren’t anything to write home about — a excluding currency and a 10.4% decline in non-GAAP operating income — its legacy Coach business continues to provide the profits necessary to allow Zeitlin to do what’s needed to revive the Kate Spade brand, which, to date, has been an abject failure.
Financially sound, Tapestry remains a strong value play for those with patience, not to mention the stomach, to ride out the turnaround.
Gaming and Leisure Properties (GLPI)
Source: Shutterstock
Gaming and Leisure Properties (NASDAQ:) is a real estate investment trust (REIT) based in Wyomissing, Pennsylvania. It owns 46 properties in 16 states that encompass 23.5 million square feet and 12,520 hotel rooms.
As for the dividend, it currently pays $2.72 a share annually, yielding 6.5%. It pays out approximately 80% of its adjusted funds from operations (AFFO), leaving it with plenty of financial flexibility and, more importantly, the cash flow necessary to keep growing the dividend per share at 5% or more per year.
It reported its Q3 2019 earnings on Oct. 31. Its to $287.6 million, while its AFFO rose a healthy 13.6% during the quarter. For all of 2019, it expects $1.15 billion in revenue (9.2% growth) and $741.5 million in AFFO (8.5%).
GLPI has its real estate assets invested across several different casino operators. No single property generates more than 5.3% of the 2018 pro forma gross gaming revenues. Its top three tenants have a combined enterprise value of $26.3 billion.
With a conservative balance sheet, GLPI’s 6.5% yield is worth biting into if income is a significant concern.
AbbVie (ABBV)
Source: Piotr Swat / Shutterstock.com
If you happened to buy AbbVie (NYSE:) in mid-August, you’re looking like a regular genius right about now. Up 30% from its 52-week low of $62.66, ABBV stock is still yielding an attractive 5.8%.
How did AbbVie drop so far after starting 2019 around $90?
The company’s of Allergan (NYSE:AGN), the manufacturer of Botox, adds a considerable amount of debt to its balance sheet. In addition, Allergan doesn’t bring to the table any blockbuster drugs like AbbVie’s Humira, which itself seems to be in Europe, but is still doing fine in the U.S.
The big reason AbbVie management bit the bullet on Allergan was to give itself time to find for Humira. In recent years it had leaned far too heavily on the arthritis drug. By diversifying its portfolio, AbbVie won’t be nearly as reliant on Humira in the future.
That’s great news for investors.
Outfront Media (OUT)
Source: Shutterstock
Over the past five years, Outfront Media’s (NYSE:) stock has been in a $10 range between $20 and $30. Currently yielding 5.7%, its stock has fallen by about 9% since hitting a 52-week high in early October.
I’ve been a fan of the REIT for several years. I love the simplicity of its business. It secures prime real estate through long-term leases and then rents out its billboards and bus shelters to advertisers who sell their products to the masses.
To change with the times, you’ve probably noticed that bus shelters and billboards are often digitized these days, which makes the cost of maintaining and changing the ads even less labor-intensive, increasing its margins.
I didn’t recommend Outfront as one of my high-yielding dividend stocks in May, but now that there are fewer good deals available, I’m righting a wrong.
However, while I like the consistency of its business, both in terms of revenue growth and earnings growth, it’s important to remember that this is a business that tends to sag a little when the economy slows as companies cut back on advertising.
That said, its latest earnings report suggests that the in the U.S. are doing just fine.
Buy some stock, enjoy the dividend, and keep some cash in reserve for when it corrects below $20.
Owl Rock Capital (ORCC)
Source: Shutterstock
Owl Rock Capital Corporation (NYSE:) is a business development company (BDC) that went public in July at $15.30 a share. Like all BDCs that qualify as a regulated investment company (RIC), it must payout at least and 90% of its tax-exempt income.
Owl Rock was established in October 2015 as a specialty lender to middle-market businesses in the U.S. The middle-market is defined as businesses with EBITDA between $10 million and $250 million and revenue between $50 million and $2.5 billion at the time of investment.
However, as of March 31, 2019, Owl Rock’s 81 portfolio companies had average annual revenues of $455 million with $80 million EBITDA and an average investment of $84.3 million yielding 9.4%, which explains how it’s able to pay out a 7.1% distribution to its shareholders.
Up 41% since its IPO, I wouldn’t expect too much appreciation over the near term. That said, it will pay a on the last day of each quarter in fiscal 2020, which increases the current yield on a forward basis to 8.9%.
It’s a company to watch.
Ready Capital (RC)
Source: Shutterstock
Ready Capital (NYSE:) is a New York City-based commercial mortgage REIT that specializes in lending to small and medium-sized businesses. It’s the only nationwide specialty finance company focused on the SBC market.
SBC loans are those where the appraised value is less than $5 million and 50,000 square feet or less. Small balance loans account for approximately 15% of the $4.4 trillion in commercial mortgage debt outstanding.
It reported its third-quarter results on Nov. 6. Although they didn’t live up to analyst expectations — at 40 cents while revenues were $20.33 million, 2.3% shy of the consensus — it’s still an attractive high-yield dividend stock generating a robust 9.9% yield.
On Oct. 31, Ready announced that it acquired Knight Capital LLC, a technology-driven to small- and medium-sized businesses in all 50 states. The deal gives Ready access to smaller companies without having to build it to scale.
Of the seven high-yield dividend stocks listed in this article, Ready Capital would be considered the riskiest of the bunch.
That said, Ready Capital has originated more than since the REIT’s inception in 2012. Furthermore, its external asset manager, Waterfall Asset Management, has more than 75 investment professionals with experience in small-balance commercial loans.
At the time of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com If you happened to buy AbbVie (NYSE:) in mid-August, you’re looking like a regular genius right about now. Up 30% from its 52-week low of $62.66, ABBV stock is still yielding an attractive 5.8%. How did AbbVie drop so far after starting 2019 around $90? | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com If you happened to buy AbbVie (NYSE:) in mid-August, you’re looking like a regular genius right about now. Up 30% from its 52-week low of $62.66, ABBV stock is still yielding an attractive 5.8%. How did AbbVie drop so far after starting 2019 around $90? | AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com If you happened to buy AbbVie (NYSE:) in mid-August, you’re looking like a regular genius right about now. Up 30% from its 52-week low of $62.66, ABBV stock is still yielding an attractive 5.8%. How did AbbVie drop so far after starting 2019 around $90? | The big reason AbbVie management bit the bullet on Allergan was to give itself time to find for Humira. AbbVie (ABBV) Source: Piotr Swat / Shutterstock.com If you happened to buy AbbVie (NYSE:) in mid-August, you’re looking like a regular genius right about now. Up 30% from its 52-week low of $62.66, ABBV stock is still yielding an attractive 5.8%. |
24825.0 | 2019-11-11 00:00:00 UTC | 3 Top Healthcare Stocks to Buy Right Now | ABBV | https://www.nasdaq.com/articles/3-top-healthcare-stocks-to-buy-right-now-2019-11-11 | nan | nan | As healthcare costs outpace the rise in inflation, the U.S. will soon spend about 20% of the gross domestic product on healthcare. Smart investors are eyeing key healthcare stocks set to outperform in the next year.
Veeva Systems (NYSE: VEEV), AbbVie (NYSE: ABBV), and Novartis (NYSE: NVS) are three healthcare stocks worth considering for your stock portfolio.
1. Veeva Systems
Veeva Systems makes cloud-based software for traditional drug companies and biotech companies. It helps pharma companies manage operations, sales, and comply with industry regulations. Its industry-specific application, Vault, has an addressable market of $5 billion. Revenue from Vault is expected to grow 40% annually and its 2019 estimated revenue is $550 million.
The company reached profitability within three years, which speaks a lot about its fundamentals. Veeva has exceeded earnings expectations for the last five years, boasting an average revenue growth of 33%. It expects the annual revenue from Vault to surpass $1 billion at the end of January 2020.
Source: Getty Images
The sales are increasing fast and the gross profit margin on services sold is also improving. Total revenue for the second quarter increased 27% year over year to reach $266.9 million. The subscription services showed an increase of 28% year over year, hitting $217.3 million up from $169.6 million a year ago. Second-quarter net income showed a 58% increase year over year to $79.2 million.
It is expected that global spending on digital transformation will grow into double digits for the future. Veeva's focus on the life sciences industry has helped it expand the relationships with customers despite competition in the industry. It's safe to say the company will have a high customer base in five years' time and the sales will continue to convert to high profits over time.
Its forward P/E is 66.23 compared to the industry average P/E of 58.91. It carries a PEG ratio of 3.48, while the industry PEG ratio is more fairly valued at 2.85. These metrics clearly show the stock is trading at a premium, but investors who are willing to pay up for the price will be rewarded in the long-term.
2. AbbVie
Abbvie was spun-off from Abbott Labs (NYSE: ABT) in 2013 and it has heavily relied on its legacy Humira drug, which treats arthritis, Crohn's disease, and psoriasis. AbbVie's stock fell nearly 50% from $123.21 in January 2018, reaching a new low of $62.98 in August 2019. However, the stock jumped after the company topped the third-quarter estimates and announced a hike in dividend, now trading at $82.01. Its dividend yield is 6.44% and it declared a $1.18 dividend for the quarter, a 10.3% increase from the prior dividend.
AbbVie is diversifying away from Humira and is expected to launch about 20 new products by 2020. The company's immunology drugs, Skyrizi and Rinvoq recently received U.S. Food and Drug Administration approval. These drugs are being evaluated for Crohn's disease, ulcerative colitis, psoriatic arthritis, and atopic dermatitis. The company thinks Skyrizi could reach annual sales of $5 billion and Rinvoq could achieve yearly sales of $6.5 billion. If these revenues are achieved, the company should be able to offset the expected sales decline for Humira when it begins facing biosimilar competition. Humira sales fell by 3.7% to $4.94 billion.
In June, the company announced its plan to acquire Allergan for $63 billion. Allergan specializes in Botox and this deal will give the company a product with high sales in aesthetics, which doesn't depend on insurance reimbursement. The company is confident that Botox will continue to drive sales in the coming quarters.
AbbVie's total revenue rose to $8.48 billion, exceeding estimates of $8.38 billion. The company expects 2019 revenues to grow 2.5%, exceeding analyst estimates of $33.16 billion. The trailing P/E ratio of the company is 37.71 and forward P/E is 8.61. The company has strong growth prospects and its stock is selling at an attractive price.
3. Novartis
Novartis is an impressive name in the healthcare industry. Considering its drug lineup, it's not surprising that investors are attracted to the stock. Its 10 revenue-producing drugs have seen a significant rise in the past quarter.
Zolgensma offers a breakthrough treatment for a muscle disorder with a price tag of $2.1 million. It recorded sales of $160 million in the quarter, exceeding analysts' estimates. Another top-selling drug, Cosentyx, hit $937 million in quarterly revenue. The sales of Lucentis increased by 5% to reach $500 million. Further, the company released impressive clinical trial results for Kisqali, a breast cancer drug. When taken with another drug, Fulvestrant, the survival rates for patients shot up 58%. This drug could significantly increase the company's revenue over the next few years.
Novartis' third-quarter results show a net income of $2 billion, with its sales hitting $12.2 billion driven by five drugs:
Cosentyx generated sales of $937 million with high demand across several regions.
Entresto generated sales of $430 million with a high demand in hospitals.
Zolgensma generated sales of $160 million.
Lutathera sales grew to $119 million.
Piqray sales were $43 million.
The company's free cash flow is $4 billion, compared to $3.2 billion in the previous year. The company has a strong future outlook considering the top drug lineup. The stock is currently trading at $86.46. It's not cheap, at a P/E of 17.17, but investors who are optimistic about its deal with Allergan would do well to buy today.
Now is the time to buy
Veeva Systems, AbbVie, and Novartis are three health stocks that can generate lucrative returns for investors in the long-run.
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Vandita Jadeja has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Veeva Systems. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Now is the time to buy Veeva Systems, AbbVie, and Novartis are three health stocks that can generate lucrative returns for investors in the long-run. Veeva Systems (NYSE: VEEV), AbbVie (NYSE: ABBV), and Novartis (NYSE: NVS) are three healthcare stocks worth considering for your stock portfolio. AbbVie Abbvie was spun-off from Abbott Labs (NYSE: ABT) in 2013 and it has heavily relied on its legacy Humira drug, which treats arthritis, Crohn's disease, and psoriasis. | Veeva Systems (NYSE: VEEV), AbbVie (NYSE: ABBV), and Novartis (NYSE: NVS) are three healthcare stocks worth considering for your stock portfolio. AbbVie Abbvie was spun-off from Abbott Labs (NYSE: ABT) in 2013 and it has heavily relied on its legacy Humira drug, which treats arthritis, Crohn's disease, and psoriasis. AbbVie's stock fell nearly 50% from $123.21 in January 2018, reaching a new low of $62.98 in August 2019. | Veeva Systems (NYSE: VEEV), AbbVie (NYSE: ABBV), and Novartis (NYSE: NVS) are three healthcare stocks worth considering for your stock portfolio. AbbVie Abbvie was spun-off from Abbott Labs (NYSE: ABT) in 2013 and it has heavily relied on its legacy Humira drug, which treats arthritis, Crohn's disease, and psoriasis. AbbVie's stock fell nearly 50% from $123.21 in January 2018, reaching a new low of $62.98 in August 2019. | Veeva Systems (NYSE: VEEV), AbbVie (NYSE: ABBV), and Novartis (NYSE: NVS) are three healthcare stocks worth considering for your stock portfolio. AbbVie Abbvie was spun-off from Abbott Labs (NYSE: ABT) in 2013 and it has heavily relied on its legacy Humira drug, which treats arthritis, Crohn's disease, and psoriasis. AbbVie's stock fell nearly 50% from $123.21 in January 2018, reaching a new low of $62.98 in August 2019. |
24826.0 | 2019-11-10 00:00:00 UTC | This Terrific High-Yield Dividend Stock Just Got Even Better | ABBV | https://www.nasdaq.com/articles/this-terrific-high-yield-dividend-stock-just-got-even-better-2019-11-10 | nan | nan | What's better than a stock that pays great dividends? A stock that pays great dividends and keeps hiking those dividends.
That's exactly what AbbVie (NYSE: ABBV) has done since being spun off from Abbott Labs in 2013, raising its dividend every year. If you count the period when AbbVie was part of Abbott, the company entered 2019 with a 46-year streak of consecutive annual dividend hikes. And now this terrific high-yield dividend stock just got even better.
Image source: Getty Images.
Add another hike to the pile
You can bump up AbbVie's dividend-hiking streak to 47 years. The company announced yet another dividend increase with its third-quarter update on Nov. 1. AbbVie will boost its dividend payout by 10.3% beginning with the dividend payable in February 2020.
If you're keeping score, that brings AbbVie's total accumulated dividend increase since being spun off from Abbott to a cool 195%. Who wouldn't love a dividend that nearly triples in seven years?
This latest dividend hike also makes AbbVie's sky-high dividend yield even more attractive. The company's forward-looking yield now stands at 5.21%. AbbVie's dividend yield has been above 4% for practically all of 2019.
Can AbbVie keep it up?
Some investors have been highly skeptical about AbbVie's prospects. The big pharma company already faces biosimilar competition in Europe for its top-selling drug, Humira. Biosimilars will hit the U.S. market in a little over three years from now.
AbbVie's pending $63 billion acquisition of Allergan (NYSE: AGN) has also been derided as a colossal mistake. The main criticism of the deal is that Allergan has its own problems with stagnating growth and its reliance on blockbuster drug Botox.
With sales for Humira in jeopardy and serious questions about the Allergan buyout, can AbbVie keep its dividend program going as strong as it has in the past? I think it can.
For one thing, AbbVie has already secured key FDA approvals for two successors to Humira, Rinvoq and Skyrizi. Market researcher EvaluatePharma ranked both drugs in its top five new drug launches of 2019, with Rinvoq coming in at No. 3 and Skyrizi at No. 2. The two drugs are expected to combine for peak annual sales of over $10 billion, more than half of what Humira generated last year.
AbbVie also has several other drugs that should continue to deliver strong sales growth. Blood cancer drug Imbruvica appears to be on track to become the world's No. 5 biggest-selling drug by 2024. Another blood cancer drug, Venclexta, could reach $2 billion in annual sales -- nearly three times what the drug will bring in this year. Orilissa, which is already approved for treating endometriosis and is expected to pick up another indication in treating uterine fibroids, could also be a blockbuster in the future.
Don't discount Allergan's prospects, either. Sales for Botox keep on growing. Antipsychotic drug Vraylar is looking like a big winner with sales skyrocketing 70% year over year in Q3 to nearly $235 million. Allergan hopes to win FDA approval for migraine drug ubrogepant this year with a U.S. launch in 2020. AbbVie expects that the addition of Allergan's current lineup and pipeline candidates will greatly reduce its reliance on Humira.
A Dividend King in the making
AbbVie CEO Rick Gonzalez stated in the company's Q3 conference call that AbbVie remains "committed to a strong and growing dividend." The latest double-digit percent increase appears to confirm that commitment.
Including its time as part of Abbott, AbbVie already belongs to the group of stocks known as Dividend Aristocrats -- companies that have increased their dividend for at least 25 consecutive years. There's an even more elite group, though, called Dividend Kings, that has delivered dividend hikes for 50 years in a row. AbbVie only has to boost its dividend in each of the next three years to join the exclusive club.
I think that AbbVie is a Dividend King in the making and one of the best dividend stocks on the market right now.
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Keith Speights owns shares of AbbVie. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | If you count the period when AbbVie was part of Abbott, the company entered 2019 with a 46-year streak of consecutive annual dividend hikes. With sales for Humira in jeopardy and serious questions about the Allergan buyout, can AbbVie keep its dividend program going as strong as it has in the past? AbbVie expects that the addition of Allergan's current lineup and pipeline candidates will greatly reduce its reliance on Humira. | If you count the period when AbbVie was part of Abbott, the company entered 2019 with a 46-year streak of consecutive annual dividend hikes. This latest dividend hike also makes AbbVie's sky-high dividend yield even more attractive. That's exactly what AbbVie (NYSE: ABBV) has done since being spun off from Abbott Labs in 2013, raising its dividend every year. | A Dividend King in the making AbbVie CEO Rick Gonzalez stated in the company's Q3 conference call that AbbVie remains "committed to a strong and growing dividend." Including its time as part of Abbott, AbbVie already belongs to the group of stocks known as Dividend Aristocrats -- companies that have increased their dividend for at least 25 consecutive years. I think that AbbVie is a Dividend King in the making and one of the best dividend stocks on the market right now. | Can AbbVie keep it up? I think that AbbVie is a Dividend King in the making and one of the best dividend stocks on the market right now. That's exactly what AbbVie (NYSE: ABBV) has done since being spun off from Abbott Labs in 2013, raising its dividend every year. |
24827.0 | 2019-11-09 00:00:00 UTC | 2 Biotech Stocks Fighting Alzheimer’s Disease to Own Now | ABBV | https://www.nasdaq.com/articles/2-biotech-stocks-fighting-alzheimers-disease-to-own-now-2019-11-09 | nan | nan | The Alzheimer's community got a boost at the end of October when Biogen (NASDAQ: BIIB) announced it would file for approval from the U.S. Food and Drug Administration for aducanumab, its Alzheimer's disease drug. This caught patients and investors off guard since Biogen scrapped the program back in March due to lack of efficacy. The new analysis showed that early-stage patients receiving high doses of the drug slowed down the rate of cognitive decline.
Shortly after Biogen's announcement, Chinese regulators surprised the world by giving conditional approval to a new drug for Alzheimer's disease made by Shanghai Green Valley Pharmaceuticals. The drug, which is derived from seaweed, improved cognitive function by interacting with the gut microbiome, a collection of over 1,000 microorganisms, like bacteria and fungi, located in the stomach and intestines and responsible for digestion, brain health, and controlling the immune system. Detailed results from the 800 patient clinical trial have yet to be released, resulting in a high degree of skepticism.
Source: Getty Images
However, the news from China raises hope that novel approaches may unlock the key to treating the ever-growing Alzheimer's disease population. Alector (NASDAQ: ALEC) and Denali Therapeutics (NASDAQ: DNLI), relatively new biotechs focused on neurodegenerative diseases, provide investors with two avenues to get in on unique, cutting-edge research in Alzheimer's disease.
Alector pursues immunotherapy for the brain
Alector's research approach hinges on the brain's immune system. Historically, the scientific community thought the brain's immune system reacted in response to the disease. New data from Alector shows that the immune system itself can contribute to the neurodegeneration. Alector scientists embarked on identifying and targeting the genes responsible for that interaction.
Big pharma companies saw the potential and wanted in on the action. AbbVie (NYSE: ABBV) paid $205 million in cash and made a $20 million equity investment in 2017 to collaborate with Alector to generate new Alzheimer's drugs. Alector will develop the drugs through phase 2 trials. If AbbVie opts to take on the future development, Alector could receive up to $985.6 million in additional milestone payments.
Earlier this year, the partnership's first drug candidates AL002 and AL003 entered human testing. These first trials focus on safety in healthy volunteers with data expected in early 2020. Demonstrating clinical efficacy will take several more years. That's why it is important to have a deep-pocketed partner like AbbVie in the picture.
Alector raised $185.1 million in its initial public offering in February. Currently, the stock trades around $17, slightly down from its $19 IPO price. The company had $411 million in cash as of June 30, which should easily cover a few years of research and development.
Source: Getty Images
Like Alector, Denali focuses on therapies that have a genetic link to neurodegenerative diseases. It also believes drug intervention needs to be optimized to be able to enter the brain. It developed a technology that it calls Antibody Transport Vehicle (ATV) to increase the penetration of antibodies across the blood-brain barrier, a natural defense to keep foreign substances out of the brain.
Denali lines up key partners
Big pharma companies liked Denali's approach and lined up to get involved. In January 2018, Takeda Pharmaceutical (NYSE: TAK) plunked down $150 million in cash and an equity investment in exchange for rights to three Alzheimer's disease programs utilizing the ATV technology. Takeda, if it exercises options on all three programs, may owe $707.5 million more in milestone payments.
One of the Takeda collaboration programs is an antibody targeting triggering receptor expressed in myeloid cells 2 (Trem2). Alector's AL002 is an antibody targeting Trem2 as well. The foot race is on with Alector taking the early lead into clinical trials.
Denali also signed up French pharma company Sanofi (NASDAQ: SNY) to a broad collaboration focused on drugs for Alzheimer's, multiple sclerosis, and amyotrophic lateral sclerosis (ALS), more commonly known as Lou Gehrig's disease. Sanofi shelled out $125 million in cash and will pay up to $1 billion in future milestone payments.
The Sanofi partnership focuses on RIPK1, a regulator of inflammation and cell death. In February 2019, Denali and Sanofi kicked off a phase 1 trial in Alzheimer's disease with DNL747. Denali dosed the first patient in a parallel Phase 1b trial in ALS in January. A prior phase 1 trial in healthy volunteers wrapped up in 2018.
Denali's big ambitions won't come cheap. The $503 million in cash at the end of the third quarter will be necessary to advance 12 active development programs. Additional capital from Takeda and Sanofi will help offset the burn rate. The cash war chest should allow the company to achieve key inflection points including results from the Phase 1b trials in Alzheimer's disease and ALS next year.
Catalysts ahead could propel valuations higher
Alector and Denali sport valuations of $1.2 billion and $1.6 billion, respectively. Any success in Alzheimer's disease will skyrocket the valuations. As a recent example, Biogen's stock initially jumped over 35%, adding $15 billion in market cap, following the announcement that it plans to seek approval for its Alzheimer's disease drug.
Investors must recognize that early-stage biotech stocks are inherently risky. Alector and Denali are years away from approval. But, if either can successfully develop an Alzheimer's drug, then the current prices will look cheap.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (NYSE: ABBV) paid $205 million in cash and made a $20 million equity investment in 2017 to collaborate with Alector to generate new Alzheimer's drugs. If AbbVie opts to take on the future development, Alector could receive up to $985.6 million in additional milestone payments. That's why it is important to have a deep-pocketed partner like AbbVie in the picture. | AbbVie (NYSE: ABBV) paid $205 million in cash and made a $20 million equity investment in 2017 to collaborate with Alector to generate new Alzheimer's drugs. If AbbVie opts to take on the future development, Alector could receive up to $985.6 million in additional milestone payments. That's why it is important to have a deep-pocketed partner like AbbVie in the picture. | AbbVie (NYSE: ABBV) paid $205 million in cash and made a $20 million equity investment in 2017 to collaborate with Alector to generate new Alzheimer's drugs. If AbbVie opts to take on the future development, Alector could receive up to $985.6 million in additional milestone payments. That's why it is important to have a deep-pocketed partner like AbbVie in the picture. | AbbVie (NYSE: ABBV) paid $205 million in cash and made a $20 million equity investment in 2017 to collaborate with Alector to generate new Alzheimer's drugs. If AbbVie opts to take on the future development, Alector could receive up to $985.6 million in additional milestone payments. That's why it is important to have a deep-pocketed partner like AbbVie in the picture. |
24828.0 | 2019-11-08 00:00:00 UTC | Friday Sector Leaders: Healthcare, Technology & Communications | ABBV | https://www.nasdaq.com/articles/friday-sector-leaders%3A-healthcare-technology-communications-2019-11-08 | nan | nan | Looking at the sectors faring best as of midday Friday, shares of Healthcare companies are outperforming other sectors, up 0.6%. Within the sector, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and AbbVie Inc (Symbol: ABBV) are two large stocks leading the way, showing a gain of 4.5% and 3.9%, respectively. Among healthcare ETFs, one ETF following the sector is the Health Care Select Sector SPDR ETF (Symbol: XLV), which is up 0.6% on the day, and up 11.07% year-to-date. Regeneron Pharmaceuticals, Inc., meanwhile, is down 8.66% year-to-date, and AbbVie Inc, is down 2.90% year-to-date. Combined, REGN and ABBV make up approximately 3.9% of the underlying holdings of XLV.
The next best performing sector is the Technology & Communications sector, higher by 0.1%. Among large Technology & Communications stocks, Xerox Holdings Corp (Symbol: XRX) and Qualcomm Inc (Symbol: QCOM) are the most notable, showing a gain of 4.5% and 2.4%, respectively. One ETF closely tracking Technology & Communications stocks is the Technology Select Sector SPDR ETF (XLK), which is up 0.1% in midday trading, and up 39.47% on a year-to-date basis. Xerox Holdings Corp, meanwhile, is up 101.16% year-to-date, and Qualcomm Inc is up 65.17% year-to-date. Combined, XRX and QCOM make up approximately 1.8% of the underlying holdings of XLK.
Comparing these stocks and ETFs on a trailing twelve month basis, below is a relative stock price performance chart, with each of the symbols shown in a different color as labeled in the legend at the bottom:
Here's a snapshot of how the S&P 500 components within the various sectors are faring in afternoon trading on Friday. As you can see, two sectors are up on the day, while five sectors are down.
10 ETFs With Stocks That Insiders Are Buying »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Combined, REGN and ABBV make up approximately 3.9% of the underlying holdings of XLV. Within the sector, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and AbbVie Inc (Symbol: ABBV) are two large stocks leading the way, showing a gain of 4.5% and 3.9%, respectively. Regeneron Pharmaceuticals, Inc., meanwhile, is down 8.66% year-to-date, and AbbVie Inc, is down 2.90% year-to-date. | Within the sector, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and AbbVie Inc (Symbol: ABBV) are two large stocks leading the way, showing a gain of 4.5% and 3.9%, respectively. Regeneron Pharmaceuticals, Inc., meanwhile, is down 8.66% year-to-date, and AbbVie Inc, is down 2.90% year-to-date. Combined, REGN and ABBV make up approximately 3.9% of the underlying holdings of XLV. | Within the sector, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and AbbVie Inc (Symbol: ABBV) are two large stocks leading the way, showing a gain of 4.5% and 3.9%, respectively. Regeneron Pharmaceuticals, Inc., meanwhile, is down 8.66% year-to-date, and AbbVie Inc, is down 2.90% year-to-date. Combined, REGN and ABBV make up approximately 3.9% of the underlying holdings of XLV. | Within the sector, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and AbbVie Inc (Symbol: ABBV) are two large stocks leading the way, showing a gain of 4.5% and 3.9%, respectively. Regeneron Pharmaceuticals, Inc., meanwhile, is down 8.66% year-to-date, and AbbVie Inc, is down 2.90% year-to-date. Combined, REGN and ABBV make up approximately 3.9% of the underlying holdings of XLV. |
24829.0 | 2019-11-08 00:00:00 UTC | 10 Medical Marijuana Stocks to Cure Your Portfolio | ABBV | https://www.nasdaq.com/articles/10-medical-marijuana-stocks-to-cure-your-portfolio-2019-11-08 | nan | nan | [Editor’s note: “10 Medical Marijuana Stocks to Cure Your Portfolio” was previously published in October 2019. It has since been updated to include the most relevant information available.]
Invariably, no other investment class generates as much interest and controversy as marijuana stocks. Within a generation, toward legalization shifted dramatically from strongly opposed to mostly supportive. This is largely due to demographics, as the more progressive millennials replace older Americans in positions of influence.
Additionally, marijuana stocks represent a viable economic channel that can help bridge the gap for many states’ financial issues. For instance, green-friendly enjoys significant tax revenues from its botanical industry. I don’t see this trend changing for the worse anytime soon, as awareness and popularity is only increasing.
Of course, cannabis isn’t without its controversies. Primarily, the federal government classifies marijuana as a Schedule I drug, putting it on par with hardcore narcotics like cocaine. Thus, no matter how liberal some states become toward their agricultural ambitions, the specter of federal oversight and crackdowns keeps many entrepreneurs and businesses away.
However, we have one critical exception to the rule: marijuana stocks that specialize in medicinal and therapeutic benefits. For one thing, medical cannabis mitigates the stereotypical image of potheads and general no-gooders. Plus, people experiment with pharmaceuticals all the time. Why not allow these same patients the choice for natural alternatives?
More critically for marijuana stocks, the medicinal aspect offers the best chance for international acceptance. Currently, very few jurisdictions allow recreational weed. Given the abundance of traditional and conservative nations, a green world is unlikely. But as Thailand and South Korea demonstrated, medical cannabis is a much .
As a result, you want exposure not just to marijuana stocks, but also to the therapeutic element. Here are 10 names to consider:
AbbVie (ABBV)
Source: Shutterstock
Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline.
We’re talking mainstream solutions for common ailments and diseases like arthritis and plaque psoriasis.
Still, AbbVie maintains some botanical credibility with its Marinol therapy. A synthetic cannabis-based drug, Marinol addresses chemotherapy-related side effects, such as vomiting or nausea. In addition, it helps restore appetite among AIDS patients.
Of course, you should note that Marinol isn’t among AbbVie’s top-selling products. Therefore, you’re only getting limited exposure to cannabis with ABBV stock. But based on the extreme volatility of marijuana stocks, that isn’t such a bad gig.
Emerald Health Therapeutics (EMHTF)
Source: Shutterstock
Not that I would know, but growing cannabis allegedly isn’t rocket science.
With the right conditions, the right equipment and a reasonable car, anyone can grow their stash. But cultivating the plant so that it addresses specific ailments and symptoms? That takes real effort, which is where Emerald Health Therapeutics (OTCMKTS:) comes in.
Rather than just pumping out the green stuff, Emerald deliberately seeks out the strains most effective in addressing patients’ needs. The company provides a wide of strains, which range in weight, tetrahydrocannabinol (THC) content, and cannabidiol (CBD) strength. Their impressive portfolio should lift EMHTF stock over the long run, as interest in CBD products accelerates.
It’s important to be careful with pot stocks, though. On a year-to-date basis, EMHTF stock is down 75%. While all cannabis stocks suffer volatility risk, Emerald’s concentration on medicinal weed should help mitigate downside pressure.
Aurora Cannabis (ACB)
Source: Shutterstock
I’ve spent a lot of time discussing Aurora Cannabis (NYSE:), and I don’t mean to keep double-dipping into this company. Still, I keep going back for a reason: ACB stock is an excellent play within the medical-marijuana market.
A key factor in my bullishness for Aurora is its management team. In my view, they’re making smart decisions through their acquisitive strategy.
Rather than merely focusing on outright capacity, they’re looking out over the horizon. Aurora’s buyout of Whistler Medical Marijuana gave the organization significant leverage in medical cannabis due to Whistler’s extensive .
Furthermore, ACB stock is a strong performer. In the beginning of the year, shares skyrocketed roughly 70% before plummeting. It’s down 28% this year. The inevitable correction should be only temporary. Among marijuana stocks, Aurora is exceptionally well-positioned for sustainable growth.
Cronos Group (CRON)
Source: Shutterstock
One of the top names among major marijuana stocks, Cronos Group (NASDAQ:) naturally attracts a lot of attention. This time, though, they’re attracting the wrong kind.
Prior to its earnings report for the second quarter, I worried about the company’s .
Hit or exceed it, and management can stave off criticism, but speculators looking for a discounted price may want to put CRON stock back on their radar. After concerns about vaping safety hit the news, Cronos has shed all of this year’s gains and more, as it’s down nearly 24% YTD.
Plus, Cronos has international legitimacy among medicinally focused cannabis stocks. Featuring partnerships and joint ventures across five continents, the company is ahead of the game.
CannTrust (CTST)
In business, even the green kind, you can’t get ahead of yourself. So while lucrative opportunities exist in the international sector, CannTrust (NYSE:) remains firmly committed to winning its native Canadian market.
At the same time, CannTrust can’t afford to ignore the rest of the world. Although Canada becoming the first to legalize recreational weed generated headlines, our northern neighbors alone can’t support this burgeoning industry.
Therefore, management has focused on the growth and capacity narrative to compete effectively at home and, later, abroad.
To achieve the second leg of this journey, CannTrust teamed up with Denmark’s to distribute medical cannabis products in that country.
It also inked a partnership with an Australian firm for similar distribution arrangements. While it’s not the most common name among marijuana stocks, CTST stock provides a risky, but viable, opportunity.
Innovative Industrial Properties (IIPR)
Most marijuana stocks focus on the industry’s front face; namely, production. As I mentioned earlier, marijuana isn’t that difficult to grow. So long as you have the green light legally, the physical barrier to entry is relatively short.
But the real challenge, though, is finding a consistent source of financing. This is where Innovative Industrial Properties (NYSE:) lends a helping hand.
Despite momentum toward legalization, several financial institutions shy away from cannabis ventures.
Innovative Industrial plugs the gap, offering critical capital through its leaseback business model.
Thanks to the company’s tremendous utility, IIPR stock has lit up the markets. Shares are currently up more than 75% YTD. Technically, IIPR may have gotten a bit overheated. That said, I wouldn’t get too greedy looking for the perfect entry point. Innovative Industrial levers a proven business model that is only increasing in relevancy.
Terra Tech (TRTC)
Everyone recognizes cannabis stocks for two things: their incredible potential and their equally incredible volatility. Unfortunately, stakeholders of medical-cannabis producer Terra Tech (OTCMKTS:) find themselves in the latter category.
So far this year, TRTC stock is down around 53%.
And the bad news doesn’t end there. Terra Tech only had $1.9 million of cash at the end of Q2.
So why take a bet on TRTC stock? First, its vertically integrated organization may facilitate significant efficiencies as political momentum increases. Second, I dig their leadership team. The head execs are experts in finance, which should prove beneficial in properly navigating TRTC across choppy waters.
Charlotte’s Web (CWBHF)
Source: Shutterstock
When most people look at Charlotte’s Web (OTCMKTS:), they’re thinking that they missed the boat. After all, CWBHF stock jumped 78% at the beginning of this year.
From the opening price this year, however, Charlotte’s Web shares are down over 10%.
As much as I love marijuana stocks, I’m fairly certain that this cannabis firm is due for a further pullback. But once that occurs, I wouldn’t waste too much time squabbling over the granularity.
Instead, I’d consider what our own Matt McCall had to say. Thanks to the popularity of CBD, Charlotte’s Web’s CBD-based products could be distributed across channels.
Unquestionably, such an event would launch CWBHF stock into the stratosphere. Moreover, because most CBD products contain no trace of THC, they don’t fall under severe federal guidelines. Therefore, don’t get too greedy looking for an ideal price point when CWBHF corrects.
Cannabis Science (CBIS)
On paper, Cannabis Science (OTCMKTS:) represents the next evolution among cannabis stocks: pharmaceutical firms that devote their time and research exclusively toward medical marijuana.
Not only that, this is a much-needed development that could lift CBIS stock, as well as the entire botanical industry.
For decades, people unquestionably trusted the mainstream healthcare and pharmaceutical network.
However, the rapidly escalating has proven that well-intentioned medical professionals can lever a tragic impact. One of the underlying causes of this crisis is the addictiveness of prescribed medicines.
Organizations like Cannabis Science can potentially mitigate this situation with naturally sourced therapies free of psychoactive side-effects. That’s the allure of CBIS stock. However, shares trade for $0.0049 cents a pop, so this is only for the risk-tolerant.
GW Pharmaceuticals (GWPH)
Source: Shutterstock
On a surface level, GW Pharmaceuticals (NASDAQ:) brings a lot of positives to the table. As pioneers among medicinally-concentrated marijuana stocks, they lever substantial credibility.
Their drug for addressing symptoms associated with multiple sclerosis achieved better-than-expected results. This only encourages other companies to pursue cannabis-based therapies for many other diseases.
As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. |
24830.0 | 2019-11-06 00:00:00 UTC | 5 Dividend Growth Stocks With Upside To Analyst Targets | ABBV | https://www.nasdaq.com/articles/5-dividend-growth-stocks-with-upside-to-analyst-targets-2019-11-06 | nan | nan | To become a "Dividend Aristocrat," a dividend paying company must accomplish an incredible feat: consistently increase shareholder dividends every year for at least 20 consecutive years. Companies with this kind of track record tend to attract a lot of investor attention — and furthermore, "tracking" funds that follow the Dividend Aristocrats Index must own them. With all of this demand for shares, dividend growth stocks can sometimes become "fully priced," where there isn't much upside to analyst targets.
But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. Which means, if the analysts are correct, these are five dividend growth stocks that could produce capital gains in addition to their growing dividend payments.
In the first table below, we present the five stocks. The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented.
The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential:
Another consideration with dividend growth stocks is just how much the dividend is growing. We looked up the trailing twelve months worth of dividends shareholders of each of the above five companies have collected, and then also looked up the same number for the prior trailing twelve months. This gives us a rough yardstick to see how much the dividend has grown, from one trailing twelve month period to another.
These five stocks are part of our full Dividend Aristocrats List. The average analyst target price data upon which this article was based, is courtesy of data provided by Zacks Investment Research via Quandl.com.
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Dividend Growth Stocks: 25 Aristocrats »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | With all of this demand for shares, dividend growth stocks can sometimes become "fully priced," where there isn't much upside to analyst targets. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential: Another consideration with dividend growth stocks is just how much the dividend is growing. Get the latest Zacks research report on LOW — FREE Get the latest Zacks research report on FUL — FREE Dividend Growth Stocks: 25 Aristocrats » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. Get the latest Zacks research report on LOW — FREE Get the latest Zacks research report on FUL — FREE Dividend Growth Stocks: 25 Aristocrats » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential: Another consideration with dividend growth stocks is just how much the dividend is growing. | But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. |
24831.0 | 2019-11-05 00:00:00 UTC | Noteworthy ETF Outflows: DGRO, VZ, PFE, ABBV | ABBV | https://www.nasdaq.com/articles/noteworthy-etf-outflows%3A-dgro-vz-pfe-abbv-2019-11-05 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Core Dividend Growth ETF (Symbol: DGRO) where we have detected an approximate $86.8 million dollar outflow -- that's a 0.9% decrease week over week (from 228,950,000 to 226,800,000). Among the largest underlying components of DGRO, in trading today Verizon Communications Inc (Symbol: VZ) is down about 0.4%, Pfizer Inc (Symbol: PFE) is down about 1.4%, and AbbVie Inc (Symbol: ABBV) is lower by about 1.7%. For a complete list of holdings, visit the DGRO Holdings page » The chart below shows the one year price performance of DGRO, versus its 200 day moving average:
Looking at the chart above, DGRO's low point in its 52 week range is $31.04 per share, with $40.48 as the 52 week high point — that compares with a last trade of $40.36. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of DGRO, in trading today Verizon Communications Inc (Symbol: VZ) is down about 0.4%, Pfizer Inc (Symbol: PFE) is down about 1.4%, and AbbVie Inc (Symbol: ABBV) is lower by about 1.7%. For a complete list of holdings, visit the DGRO Holdings page » The chart below shows the one year price performance of DGRO, versus its 200 day moving average: Looking at the chart above, DGRO's low point in its 52 week range is $31.04 per share, with $40.48 as the 52 week high point — that compares with a last trade of $40.36. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of DGRO, in trading today Verizon Communications Inc (Symbol: VZ) is down about 0.4%, Pfizer Inc (Symbol: PFE) is down about 1.4%, and AbbVie Inc (Symbol: ABBV) is lower by about 1.7%. For a complete list of holdings, visit the DGRO Holdings page » The chart below shows the one year price performance of DGRO, versus its 200 day moving average: Looking at the chart above, DGRO's low point in its 52 week range is $31.04 per share, with $40.48 as the 52 week high point — that compares with a last trade of $40.36. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). | Among the largest underlying components of DGRO, in trading today Verizon Communications Inc (Symbol: VZ) is down about 0.4%, Pfizer Inc (Symbol: PFE) is down about 1.4%, and AbbVie Inc (Symbol: ABBV) is lower by about 1.7%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Core Dividend Growth ETF (Symbol: DGRO) where we have detected an approximate $86.8 million dollar outflow -- that's a 0.9% decrease week over week (from 228,950,000 to 226,800,000). For a complete list of holdings, visit the DGRO Holdings page » The chart below shows the one year price performance of DGRO, versus its 200 day moving average: Looking at the chart above, DGRO's low point in its 52 week range is $31.04 per share, with $40.48 as the 52 week high point — that compares with a last trade of $40.36. | Among the largest underlying components of DGRO, in trading today Verizon Communications Inc (Symbol: VZ) is down about 0.4%, Pfizer Inc (Symbol: PFE) is down about 1.4%, and AbbVie Inc (Symbol: ABBV) is lower by about 1.7%. For a complete list of holdings, visit the DGRO Holdings page » The chart below shows the one year price performance of DGRO, versus its 200 day moving average: Looking at the chart above, DGRO's low point in its 52 week range is $31.04 per share, with $40.48 as the 52 week high point — that compares with a last trade of $40.36. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). |
24832.0 | 2019-11-02 00:00:00 UTC | 3 Most Important Takeaways From AbbVie's Q3 Results | ABBV | https://www.nasdaq.com/articles/3-most-important-takeaways-from-abbvies-q3-results-2019-11-02 | nan | nan | AbbVie (NYSE: ABBV) has kind of been the Rodney Dangerfield of big pharma stocks. To paraphrase the late comedian's famous punch line: It don't get no respect.
But AbbVie just might be getting some grudging respect from investors after the company announced its third-quarter results on Friday. While those results weren't what anyone would call spectacular, there was plenty to like. Here are the three most important takeaways from AbbVie's Q3 results.
Image source: Getty Images.
1. Better than expected
The three words that investors like to hear the most when a company reports quarterly results are "better than expected." And AbbVie delivered this welcome phrase in three different ways with its Q3 update.
Wall Street analysts projected that the drugmaker would report Q3 revenue of $8.38 billion. AbbVie's actual revenue figure came in at $8.48 billion. Analysts thought the company's adjusted earnings per share (EPS) would be close to $2.30. Again, AbbVie announced better-than-expected results, with Q3 adjusted EPS of $2.33.
In addition to posting upside surprises on its top and bottom lines, AbbVie upped its full-year 2019 guidance. The company now expects adjusted EPS to be between $8.90 and $8.92, narrowing the previous outlook of between $8.82 and $8.92. The midpoint of this revised range is a little higher than the consensus analysts' full-year EPS estimate of $8.90 -- again, better than expected.
2. Humira is still a key growth driver
Investors have been especially worried about AbbVie's prospects now that Humira faces biosimilar competition in Europe. Sales for the company's top-selling drug have fallen as a result of the new dynamics for Humira. The trend continued in the third quarter.
But while Humira is struggling in European markets, it's performing quite well in the U.S. AbbVie announced U.S. sales for Humira increased by 9.6% in the third quarter from the prior-year period.
Overall sales for Humira slipped 3.7% year over year, to $4.9 billion. But the sustained momentum for Humira in the U.S. means that the drug is still a key growth driver for AbbVie. The higher sales for the drug in the U.S. market translated to more than $370 million added to AbbVie's top line. AbbVie's overall year-over-year revenue gain was $243 million. Without Humira's U.S. performance, AbbVie's overall revenue would have declined.
3. Multiple big winners stepping up
Perhaps the best news for AbbVie in Q3 was that several drugs are generating impressive growth. Unsurprisingly, Imbruvica was one of the top stars, with sales soaring 29.3% year over year to nearly $1.3 billion. Sales for AbbVie's other blood cancer drug, Venclexta, more than doubled, to $221 million.
The company's new immunology drug Skyrizi picked up momentum, with sales rising to $91 million from $48 million in the previous quarter. Rinvoq, which won Food and Drug Administration (FDA) approval in August, achieved sales of $14 million in its first few weeks on the market. The two drugs are both expected to be huge blockbusters in the near future.
AbbVie also received some help from several of its other drugs that don't usually get as much attention these days. Sales for pancreatic enzyme replacement therapy Creon jumped 11.2% year over year, to $265 million. Respiratory syncytial virus (RSV) drug Synagis raked in $132 million in Q3, up 36.2% over the prior-year period. AbbVie announced that Q3 sales for Parkinson's disease drug Duodopa rose 11.3%, to $117 million.
However, the company had some not-so-bright spots with its lineup. In particular, combined sales for its hepatitis C virus (HCV) drugs Mavyret and Viekira dropped 19% from the prior-year period, to $698 million.
More good news
In addition to its solid third-quarter results, AbbVie also announced more good news on Friday. The company's board approved a dividend increase of 10.3%. This latest increase brings the company's cumulative dividend hikes since being spun off in 2013 to 195%.
AbbVie already ranked as one of the most attractive dividend stocks on the market; now it will be even more attractive.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In addition to posting upside surprises on its top and bottom lines, AbbVie upped its full-year 2019 guidance. AbbVie (NYSE: ABBV) has kind of been the Rodney Dangerfield of big pharma stocks. But AbbVie just might be getting some grudging respect from investors after the company announced its third-quarter results on Friday. | But AbbVie just might be getting some grudging respect from investors after the company announced its third-quarter results on Friday. But while Humira is struggling in European markets, it's performing quite well in the U.S. AbbVie announced U.S. sales for Humira increased by 9.6% in the third quarter from the prior-year period. More good news In addition to its solid third-quarter results, AbbVie also announced more good news on Friday. | But while Humira is struggling in European markets, it's performing quite well in the U.S. AbbVie announced U.S. sales for Humira increased by 9.6% in the third quarter from the prior-year period. The higher sales for the drug in the U.S. market translated to more than $370 million added to AbbVie's top line. AbbVie announced that Q3 sales for Parkinson's disease drug Duodopa rose 11.3%, to $117 million. | But while Humira is struggling in European markets, it's performing quite well in the U.S. AbbVie announced U.S. sales for Humira increased by 9.6% in the third quarter from the prior-year period. The higher sales for the drug in the U.S. market translated to more than $370 million added to AbbVie's top line. AbbVie (NYSE: ABBV) has kind of been the Rodney Dangerfield of big pharma stocks. |
24833.0 | 2019-11-01 00:00:00 UTC | What Happened in the Stock Market Today | ABBV | https://www.nasdaq.com/articles/what-happened-in-the-stock-market-today-2019-11-01 | nan | nan | Major benchmarks rose Friday after a strong jobs report showed that the U.S. economy added more jobs in October than observers expected. The S&P 500 (SNPINDEX: ^GSPC) set a new record and the Dow Jones Industrial Average (DJINDICES: ^DJI) also saw strong gains. Energy and industrial stocks moved higher, while the rate-sensitive real estate and utility sectors fell slightly.
Today's stock market
Data source: Yahoo! Finance.
As for individual stocks, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) subsidiary Google plans to acquire Fitbit (NYSE: FIT), and AbbVie (NYSE: ABBV) reported third-quarter results that beat expectations on the top and bottom lines.
Image source: Getty Images.
Fitbit accepts a buyout offer from Google
Fitness tracker and smartwatch maker Fitbit has agreed to be acquired by Google in a $2.1 billion cash transaction that's been rumored since September. Shares of Fitbit rose 15.5% to $7.14, but the stock is up 65% since before Reuters broke the news of the offer on Monday.
Google has agreed to pay $7.35 per share for the pioneer in fitness wearables in a transaction expected to close in 2020, according to a press release from Fitbit. Co-founder and CEO James Park said, "With Google's resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster, and make health even more accessible to everyone." Fitbit health data won't be used for Google ads, according statements from both companies.
Google has a five-year-old wearables software platform called Wear OS, and the company positioned the acquisition as "an opportunity to invest even more in Wear OS." Devices and Services Vice President Rick Osterloh tried to reassure partners that Google is still committed to Wear OS and will work to "combine the best of our respective smartwatch and fitness tracker platforms."
AbbVie beats expectations, raises dividend
Pharmaceutical giant AbbVie beat third-quarter expectations, raised its outlook, and increased its dividend, sending shares up 2.8%. Revenue grew 3% to $8.48 billion and adjusted earnings per share rose 9% to $2.33. Analysts were expecting adjusted earnings of $2.30 on revenue of $8.38 billion.
International sales of Humira, the world's top-selling drug that accounts for 58% of the company's revenue, continue to plummet due to biosimilar competition, but a 9.6% increase in U.S. Humira sales and growth from the hematological oncology portfolio offset those losses. Sales of the blood cancer drugs increased 38% to $1.5 billion.
Looking forward, AbbVie raised the low end of adjusted EPS guidance for the full year by $0.08 to $8.90 to $8.92, representing year-over-year growth of 12.6%. The company increased its already generous quarterly dividend by 10% to $1.18, giving the stock a forward yield of 5.8%.
AbbVie said it's making progress on its planned acquisition of Allergan, which it expects to close in Q1 of 2020.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Looking forward, AbbVie raised the low end of adjusted EPS guidance for the full year by $0.08 to $8.90 to $8.92, representing year-over-year growth of 12.6%. As for individual stocks, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) subsidiary Google plans to acquire Fitbit (NYSE: FIT), and AbbVie (NYSE: ABBV) reported third-quarter results that beat expectations on the top and bottom lines. AbbVie beats expectations, raises dividend Pharmaceutical giant AbbVie beat third-quarter expectations, raised its outlook, and increased its dividend, sending shares up 2.8%. | As for individual stocks, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) subsidiary Google plans to acquire Fitbit (NYSE: FIT), and AbbVie (NYSE: ABBV) reported third-quarter results that beat expectations on the top and bottom lines. AbbVie beats expectations, raises dividend Pharmaceutical giant AbbVie beat third-quarter expectations, raised its outlook, and increased its dividend, sending shares up 2.8%. Looking forward, AbbVie raised the low end of adjusted EPS guidance for the full year by $0.08 to $8.90 to $8.92, representing year-over-year growth of 12.6%. | As for individual stocks, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) subsidiary Google plans to acquire Fitbit (NYSE: FIT), and AbbVie (NYSE: ABBV) reported third-quarter results that beat expectations on the top and bottom lines. AbbVie beats expectations, raises dividend Pharmaceutical giant AbbVie beat third-quarter expectations, raised its outlook, and increased its dividend, sending shares up 2.8%. Looking forward, AbbVie raised the low end of adjusted EPS guidance for the full year by $0.08 to $8.90 to $8.92, representing year-over-year growth of 12.6%. | AbbVie beats expectations, raises dividend Pharmaceutical giant AbbVie beat third-quarter expectations, raised its outlook, and increased its dividend, sending shares up 2.8%. As for individual stocks, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) subsidiary Google plans to acquire Fitbit (NYSE: FIT), and AbbVie (NYSE: ABBV) reported third-quarter results that beat expectations on the top and bottom lines. Looking forward, AbbVie raised the low end of adjusted EPS guidance for the full year by $0.08 to $8.90 to $8.92, representing year-over-year growth of 12.6%. |
24834.0 | 2019-11-01 00:00:00 UTC | 6 Top Stock Trades for Monday: BABA, PINS, CVX | ABBV | https://www.nasdaq.com/articles/6-top-stock-trades-for-monday%3A-baba-pins-cvx-2019-11-01 | nan | nan | A better-than-expected jobs report thrust equities to new all-time highs once again, with the S&P 500 notching its fourth new high in five days. Let’s take a look at a few top stock trades as the markets continue to roll higher.
Top Stock Trades for Tomorrow No. 1: Alibaba (BABA)
Alibaba (NYSE:) is barely in positive territory following its earnings report, but the technical setup is not that appealing.
Shares tried to break out over the $180 level, but failed to hold onto its gains. The silver lining here? BABA stock is still above short-term uptrend support (purple line), as well as its cluster of major moving averages between $171 and $173.
A move below uptrend support would negate the breakout, while a decline below its moving averages would be a sign of caution. Below $170 and uptrend support (blue line) is in play near $165.
Over $180 and the breakout is back on the table, with the first upside target being Friday’s post-earnings high, followed by the September high of $184.13.
Top Stock Trades for Tomorrow No. 2: Pinterest (PINS)
For most of our pre-earnings setups, we don’t need to revisit them a day later. For Pinterest (NYSE:), though, the stock’s major decline is forcing us to take a second look.
Shares were down more than 25% at one point, just below the $19 IPO price. With Friday’s sharp rebound though, bulls have a tradable low to measure against. On the upside, see if PINS can rally back to its prior post-IPO low near $23. Above that and it can fill the gap up toward $25.
Below Friday’s low and PINS is a no touch.
Top Stock Trades for Tomorrow No. 3: AbbVie (ABBV)
AbbVie (NYSE:) stock has been on fire, and Friday’s post-earnings rally is only adding fuel to that fire. The stock is nearing overbought territory on a weekly basis, and has long since cleared prior downtrend resistance (blue line).
Let’s see if the 100-week moving average gives ABBV any issues, up at $83.50. Over it and the 52-week highs near $90 are on the table. If the 100-week moving average is resistance, see if ABBV finds support either at the 50-week or 200-week moving average.
The stock was recently for 2019.
Top Stock Trades for Tomorrow No. 4: Chevron (CVX)
Despite bouncing around on the day, Chevron (NYSE:) is near flat after reporting earnings. This one has become a bit of a sloppy setup.
The upside is clogged by a cluster of moving averages between $118 and $120. On the downside, the February gap between $112 and $113 has generally been support For CVX stock this year.
Let’s keep it simple.
A dip into this zone can be bought, provided it holds as support. If it fails, a flush down to the $105 to $107 area could be in the cards. A break over $120 could send CVX up to $124-plus.
Top Stock Trades for Tomorrow No. 5: U.S. Steel (X)
Want to stick with the keep-it-simple approach? U.S. Steel (NYSE:) is jumping on Friday, but running into an important level.
If it moves over the $13 to $13.25 level and the 100-day moving average, X stock can continue higher. It puts the 78.6% retracement at $14.60 in play, as well as the declining 200-day moving average.
If it falls below $13, lower prices may be in store.
Top Stock Trades for Tomorrow No. 6: Funko (FNKO)
It has been a while since we’ve talked about Funko (NASDAQ:). $17 and channel support both gave way on Friday, leading to a flood of selling. Shares are now near $15.
Below the 23.6% retracement and near its session low, there’s little confidence in Funko right now.
Friday’s move technically puts the $12 area in play, although it may take a while to flush down to that point. From here, see if FNKO can reclaim $15.15, the 23.6% retracement. Above it puts the underside of prior channel support in play. Below $15 and shares can remain under pressure.
Funko is also a no-touch for me at this moment.
Bret Kenwell is the manager and author of and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long PINS.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | 3: AbbVie (ABBV) AbbVie (NYSE:) stock has been on fire, and Friday’s post-earnings rally is only adding fuel to that fire. Let’s see if the 100-week moving average gives ABBV any issues, up at $83.50. If the 100-week moving average is resistance, see if ABBV finds support either at the 50-week or 200-week moving average. | 3: AbbVie (ABBV) AbbVie (NYSE:) stock has been on fire, and Friday’s post-earnings rally is only adding fuel to that fire. Let’s see if the 100-week moving average gives ABBV any issues, up at $83.50. If the 100-week moving average is resistance, see if ABBV finds support either at the 50-week or 200-week moving average. | If the 100-week moving average is resistance, see if ABBV finds support either at the 50-week or 200-week moving average. 3: AbbVie (ABBV) AbbVie (NYSE:) stock has been on fire, and Friday’s post-earnings rally is only adding fuel to that fire. Let’s see if the 100-week moving average gives ABBV any issues, up at $83.50. | 3: AbbVie (ABBV) AbbVie (NYSE:) stock has been on fire, and Friday’s post-earnings rally is only adding fuel to that fire. Let’s see if the 100-week moving average gives ABBV any issues, up at $83.50. If the 100-week moving average is resistance, see if ABBV finds support either at the 50-week or 200-week moving average. |
24835.0 | 2019-11-01 00:00:00 UTC | Daily Dividend Report: ABBV, WLKP, AIG, EXC, COF | ABBV | https://www.nasdaq.com/articles/daily-dividend-report%3A-abbv-wlkp-aig-exc-cof-2019-11-01 | nan | nan | AbbVie is announcing today that its board of directors declared an increase in the company's quarterly cash dividend from $1.07 per share to $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. This reflects an increase of approximately 10.3 percent, continuing AbbVie's strong commitment to returning cash to shareholders through a growing dividend. Since the company's inception in 2013, AbbVie has increased its quarterly dividend by 195 percent. AbbVie is a member of the S&P Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years.
The Board of Directors of Westlake Chemical Partners, has adjusted its distribution growth strategy to reflect market conditions and today declared a distribution of $0.4646 per unit, representing a 1.5% increase from the second quarter 2019 distribution. This is the 21st quarterly distribution announced by the Partnership since its initial public offering. The distribution will be payable on November 26, 2019, to unit holders of record on November 12, 2019.
American International Group, today announced that its Board of Directors declared a quarterly cash dividend of $0.32 per share on AIG Common Stock, par value $2.50 per share. The dividend is payable on December 26, 2019 to stockholders of record at the close of business on December 12, 2019.
The Board of Directors of Exelon declared a regular quarterly dividend of $0.3625 per share on Exelon's common stock. The dividend is payable on Tuesday, Dec. 10, 2019, to shareholders of record of Exelon Friday, Nov. 15, 2019.
Capital One Financial today announced a quarterly dividend of $0.40 per share payable November 22, 2019, to stockholders of record as of November 12, 2019. The company has announced dividends on its common stock every quarter since it became an independent company on February 28, 1995.
VIDEO: Daily Dividend Report: ABBV, WLKP, AIG, EXC, COF
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie is announcing today that its board of directors declared an increase in the company's quarterly cash dividend from $1.07 per share to $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. This reflects an increase of approximately 10.3 percent, continuing AbbVie's strong commitment to returning cash to shareholders through a growing dividend. VIDEO: Daily Dividend Report: ABBV, WLKP, AIG, EXC, COF The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie is announcing today that its board of directors declared an increase in the company's quarterly cash dividend from $1.07 per share to $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. This reflects an increase of approximately 10.3 percent, continuing AbbVie's strong commitment to returning cash to shareholders through a growing dividend. Since the company's inception in 2013, AbbVie has increased its quarterly dividend by 195 percent. | AbbVie is announcing today that its board of directors declared an increase in the company's quarterly cash dividend from $1.07 per share to $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. This reflects an increase of approximately 10.3 percent, continuing AbbVie's strong commitment to returning cash to shareholders through a growing dividend. Since the company's inception in 2013, AbbVie has increased its quarterly dividend by 195 percent. | AbbVie is announcing today that its board of directors declared an increase in the company's quarterly cash dividend from $1.07 per share to $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. This reflects an increase of approximately 10.3 percent, continuing AbbVie's strong commitment to returning cash to shareholders through a growing dividend. Since the company's inception in 2013, AbbVie has increased its quarterly dividend by 195 percent. |
24836.0 | 2019-11-01 00:00:00 UTC | 2019's Biggest Mergers and Acquisitions (So Far) | ABBV | https://www.nasdaq.com/articles/2019s-biggest-mergers-and-acquisitions-so-far-2019-11-01 | nan | nan | M
ergers and acquisitions are one of the ways for a company to grow and expand its business. M&As enable companies to extend their global footprint, diversify across geographies, gain access to better technological know-how and other resources, benefit from consolidating strategic imperatives, add complementary product lines, expertise and even turn rivalries into partnerships. The medium of mergers and acquisitions is often termed as that of "inorganic growth."
However, M&As don't always guarantee success. While many deals have been hugely successful, some have failed miserably. According to a BCG report, the past ten years have been relatively good times for dealmakers. The analysis shows that “from 2009 through 2018, about half of all public-to-public M&A deals created value in terms of announcement returns and longer-term performance.”
Just like the success of deals, a positive investor reaction isn’t a norm, and, in many cases, news of acquisition sends stock prices plummeting.
Here are some of the biggest mergers and acquisitions announced in 2019 (so far)
Merger of equals: United Technologies and Raytheon
In June 2019, United Technologies Corporation (UTX) and Raytheon Company (RTN) entered into an agreement where the two companies would combine in an all-stock merger of equals. Raytheon is a leading defense company while United Technologies is an established name in the aerospace domain. The merger of Raytheon and United Technologies will offer a complementary portfolio of platform-agnostic aerospace and defense technologies. The combined entity, which will be named Raytheon Technologies Corporation, will be listed under the symbol “RTX” and will have pro forma 2019 sales of approximately $74 billion.
“With a strong balance sheet and robust cash generation, Raytheon Technologies will enjoy enhanced resources and financial flexibility to support significant R&D and capital investment through business cycles.” Raytheon and United Technologies have a combined market value of nearly $182 billion (as of this date).
Bristol Myers Squibb’s bid to acquire rival Celgene
The year 2019 began with a definitive merger agreement between Bristol-Myers Squibb (BMY) and Celgene (CELG) under which Bristol-Myers Squibb will acquire Celgene in a $74 billion deal. The acquisition is based on compelling strategic and financial benefits.
“Together with Celgene, we are creating an innovative biopharma leader, with leading franchises and a deep and broad pipeline that will drive sustainable growth and deliver new options for patients across a range of serious diseases,” said Giovanni Caforio, M.D., Chairman and Chief Executive Officer of Bristol-Myers Squibb. The company expects more than $45 billion free cash flow generation in the first three years post-closing and approximately $2.5 billion run-rate cost synergies by 2022. With its robust financial strength and flexibility, the company is fully capable to “realize the full potential of the enhanced late- and early-stage pipeline.”
The transaction is expected to close by end of 2019 or beginning of 2020, subject to conditions and regulatory approvals.
Saudi Aramco’s majority stake acquisition of SABIC
In March this year, Saudi Aramco signed off a share purchase agreement to acquire a 70% majority stake in Saudi Basic Industries Corporation (SABIC) from the Public Investment Fund of Saudi Arabia, in a private transaction for $69 billion. At the time of the deal, Saudi Aramco and SABIC had petrochemicals production capacity of 17 and 62 million tons per annum, respectively. The stake will align the strengths and interests of two major global companies to enhance competitiveness and address the fast-growing petrochemicals market. The acquisition is in sync with Saudi Aramco’s long-term strategy to “drive growth through an enhanced line with Downstream portfolio by increasing global participated refining capacity from 4.9 million to 8-10 million barrels per day by 2030.”
AbbVie’s bid for Allergan
In June 2019, AbbVie Inc. (ABBV) entered into a definitive transaction agreement to acquire Allergan (AGN) in a $63 billion deal. The new entity, with approximately 83% AbbVie shareholders and 17% Allergen shareholders, will have an annual combined revenue of approximately $48 billion, robust cash flows, presence in 175 countries and cutting-edge R&D pipeline. The deal is expected to provide annual pre-tax synergies and other cost reductions of at least $2 billion in year three as a result of optimizing the research portfolio, eliminating overlapping R&D, driving efficiencies in selling, general and administrative expense, and eliminating redundancies in manufacturing and supply chain, among other things. The deal is expected to close by early 2020, subject to approvals.
Occidental Petroleum Corporation’s outbidding of Chevron for Anadarko
In May this year, Occidental Petroleum Corporation (OXY) outbid Chevron to acquire Anadarko Petroleum Corporation (APC) in a transaction valued at $57 billion, including the assumption of Anadarko’s debt making it one of the biggest deals in the oil segment in recent times. Backing by Berkshire Hathaway helped Occidental, which is much smaller than Chevron, close the deal. In August, Occidental completed the $55 billion deal with a more than 99% of the shares voting in favor of the deal. Chevron had earlier entered into an agreement to acquire Anadarko for $33 billion. However, after Occidental’s offer to Anadarko, Chevron did not counter-bid.
Some of other notable deals in 2019 have been that of Newmont Mining Corporation (NEM) and Goldcorp, Fidelity National Information Services's (FIS) takeover of Worldpay and Fiserv's (FISV) acquisition of First Data, Danaher’s (DHR) buy of biopharma business of General Electric Life Sciences, acquisition of Tableau by Salesforce (CRM), and merger of BB&T (BBT) and SunTrust (STI). And as of today (November 1), Alphabet (GOOG,GOOGL) announced it will buy Fitbit (FIT) for $2.1 billion.
The author has no position in any stocks mentioned. Investors should consider the above information not as a de facto recommendation, but as an idea for further consideration. Details based on press releases by companies and company websites. The list has been carefully prepared, and any exclusions from the list are unintentional.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The acquisition is in sync with Saudi Aramco’s long-term strategy to “drive growth through an enhanced line with Downstream portfolio by increasing global participated refining capacity from 4.9 million to 8-10 million barrels per day by 2030.” AbbVie’s bid for Allergan In June 2019, AbbVie Inc. (ABBV) entered into a definitive transaction agreement to acquire Allergan (AGN) in a $63 billion deal. The new entity, with approximately 83% AbbVie shareholders and 17% Allergen shareholders, will have an annual combined revenue of approximately $48 billion, robust cash flows, presence in 175 countries and cutting-edge R&D pipeline. M&As enable companies to extend their global footprint, diversify across geographies, gain access to better technological know-how and other resources, benefit from consolidating strategic imperatives, add complementary product lines, expertise and even turn rivalries into partnerships. | The acquisition is in sync with Saudi Aramco’s long-term strategy to “drive growth through an enhanced line with Downstream portfolio by increasing global participated refining capacity from 4.9 million to 8-10 million barrels per day by 2030.” AbbVie’s bid for Allergan In June 2019, AbbVie Inc. (ABBV) entered into a definitive transaction agreement to acquire Allergan (AGN) in a $63 billion deal. The new entity, with approximately 83% AbbVie shareholders and 17% Allergen shareholders, will have an annual combined revenue of approximately $48 billion, robust cash flows, presence in 175 countries and cutting-edge R&D pipeline. Here are some of the biggest mergers and acquisitions announced in 2019 (so far) Merger of equals: United Technologies and Raytheon In June 2019, United Technologies Corporation (UTX) and Raytheon Company (RTN) entered into an agreement where the two companies would combine in an all-stock merger of equals. | The acquisition is in sync with Saudi Aramco’s long-term strategy to “drive growth through an enhanced line with Downstream portfolio by increasing global participated refining capacity from 4.9 million to 8-10 million barrels per day by 2030.” AbbVie’s bid for Allergan In June 2019, AbbVie Inc. (ABBV) entered into a definitive transaction agreement to acquire Allergan (AGN) in a $63 billion deal. The new entity, with approximately 83% AbbVie shareholders and 17% Allergen shareholders, will have an annual combined revenue of approximately $48 billion, robust cash flows, presence in 175 countries and cutting-edge R&D pipeline. Here are some of the biggest mergers and acquisitions announced in 2019 (so far) Merger of equals: United Technologies and Raytheon In June 2019, United Technologies Corporation (UTX) and Raytheon Company (RTN) entered into an agreement where the two companies would combine in an all-stock merger of equals. | The acquisition is in sync with Saudi Aramco’s long-term strategy to “drive growth through an enhanced line with Downstream portfolio by increasing global participated refining capacity from 4.9 million to 8-10 million barrels per day by 2030.” AbbVie’s bid for Allergan In June 2019, AbbVie Inc. (ABBV) entered into a definitive transaction agreement to acquire Allergan (AGN) in a $63 billion deal. The new entity, with approximately 83% AbbVie shareholders and 17% Allergen shareholders, will have an annual combined revenue of approximately $48 billion, robust cash flows, presence in 175 countries and cutting-edge R&D pipeline. Here are some of the biggest mergers and acquisitions announced in 2019 (so far) Merger of equals: United Technologies and Raytheon In June 2019, United Technologies Corporation (UTX) and Raytheon Company (RTN) entered into an agreement where the two companies would combine in an all-stock merger of equals. |
24837.0 | 2019-11-01 00:00:00 UTC | Health Care Sector Update for 11/01/2019: ABBV, EIDX, MD, JNJ, PFE, ABT, MRK, AMGN | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-11-01-2019%3A-abbv-eidx-md-jnj-pfe-abt-mrk-amgn-2019-11-01 | nan | nan | Top Health Care Stocks:
JNJ: +0.33%
PFE: +0.55%
ABT: -0.37%
MRK: +0.51%
AMGN: +0.70%
Most health care majors were gaining pre-bell Friday.
In other sector news:
(+) AbbVie (ABBV) was slightly higher after it reported Q3 adjusted diluted earnings per share of $2.33, up from $2.14 during the year-ago quarter, and beating the Capital IQ consensus forecast of $2.30.
(=) Eidos Therapeutics (EIDX) was flat after it booked a Q3 net profit of $0.18 per share, compared with a $0.30 loss per share in the prior year period. The Street was forecasting a loss of $0.27 per share.
(=) Mednax (MD) was unchanged after it reported a Q3 adjusted EPS of $0.91, rising from $0.86 a year ago and meeting the consensus estimate from analysts surveyed by Capital IQ.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In other sector news: (+) AbbVie (ABBV) was slightly higher after it reported Q3 adjusted diluted earnings per share of $2.33, up from $2.14 during the year-ago quarter, and beating the Capital IQ consensus forecast of $2.30. Most health care majors were gaining pre-bell Friday. (=) Mednax (MD) was unchanged after it reported a Q3 adjusted EPS of $0.91, rising from $0.86 a year ago and meeting the consensus estimate from analysts surveyed by Capital IQ. | In other sector news: (+) AbbVie (ABBV) was slightly higher after it reported Q3 adjusted diluted earnings per share of $2.33, up from $2.14 during the year-ago quarter, and beating the Capital IQ consensus forecast of $2.30. Top Health Care Stocks: Most health care majors were gaining pre-bell Friday. | In other sector news: (+) AbbVie (ABBV) was slightly higher after it reported Q3 adjusted diluted earnings per share of $2.33, up from $2.14 during the year-ago quarter, and beating the Capital IQ consensus forecast of $2.30. Most health care majors were gaining pre-bell Friday. (=) Eidos Therapeutics (EIDX) was flat after it booked a Q3 net profit of $0.18 per share, compared with a $0.30 loss per share in the prior year period. | In other sector news: (+) AbbVie (ABBV) was slightly higher after it reported Q3 adjusted diluted earnings per share of $2.33, up from $2.14 during the year-ago quarter, and beating the Capital IQ consensus forecast of $2.30. Top Health Care Stocks: The Street was forecasting a loss of $0.27 per share. |
24838.0 | 2019-11-01 00:00:00 UTC | AbbVie Boosts FY19 Adj. EPS Outlook; Boosts Dividend 10.2% - Quick Facts | ABBV | https://www.nasdaq.com/articles/abbvie-boosts-fy19-adj.-eps-outlook-boosts-dividend-10.2-quick-facts-2019-11-01 | nan | nan | (RTTNews) - While reporting financial results for the third quarter on Friday, biopharmaceutical company AbbVie Inc. (ABBV) raised its adjusted earnings guidance for the full-year 2019.
For fiscal 2019, AbbVie now projects adjusted earnings in a range of $8.90 to $8.92 per share, up from the prior guidance range of $8.82 to $8.92 per share.
On average, analysts polled by Thomson Reuters expect the company to report earnings of $8.90 per share for the year. Analysts' estimates typically exclude special items.
Further, AbbVie announced that its board of directors declared a 10.3 percent higher quarterly cash dividend of $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - While reporting financial results for the third quarter on Friday, biopharmaceutical company AbbVie Inc. (ABBV) raised its adjusted earnings guidance for the full-year 2019. Further, AbbVie announced that its board of directors declared a 10.3 percent higher quarterly cash dividend of $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. For fiscal 2019, AbbVie now projects adjusted earnings in a range of $8.90 to $8.92 per share, up from the prior guidance range of $8.82 to $8.92 per share. | (RTTNews) - While reporting financial results for the third quarter on Friday, biopharmaceutical company AbbVie Inc. (ABBV) raised its adjusted earnings guidance for the full-year 2019. For fiscal 2019, AbbVie now projects adjusted earnings in a range of $8.90 to $8.92 per share, up from the prior guidance range of $8.82 to $8.92 per share. Further, AbbVie announced that its board of directors declared a 10.3 percent higher quarterly cash dividend of $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. | (RTTNews) - While reporting financial results for the third quarter on Friday, biopharmaceutical company AbbVie Inc. (ABBV) raised its adjusted earnings guidance for the full-year 2019. For fiscal 2019, AbbVie now projects adjusted earnings in a range of $8.90 to $8.92 per share, up from the prior guidance range of $8.82 to $8.92 per share. Further, AbbVie announced that its board of directors declared a 10.3 percent higher quarterly cash dividend of $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. | (RTTNews) - While reporting financial results for the third quarter on Friday, biopharmaceutical company AbbVie Inc. (ABBV) raised its adjusted earnings guidance for the full-year 2019. Further, AbbVie announced that its board of directors declared a 10.3 percent higher quarterly cash dividend of $1.18 per share beginning with the dividend payable on February 14, 2020 to shareholders of record as of January 15, 2020. For fiscal 2019, AbbVie now projects adjusted earnings in a range of $8.90 to $8.92 per share, up from the prior guidance range of $8.82 to $8.92 per share. |
24839.0 | 2019-11-01 00:00:00 UTC | Novartis: Cosentyx Shows Positive Results Vs Humira In Psoriatic Arthritis Trial | ABBV | https://www.nasdaq.com/articles/novartis%3A-cosentyx-shows-positive-results-vs-humira-in-psoriatic-arthritis-trial-2019-11 | nan | nan | (RTTNews) - Swiss drug major Novartis AG (NVS) announced Friday that Cosentyx shows encouraging results versus Humira from first-of-its-kind head-to-head trial in psoriatic arthritis.
In a statement, the company announced results from the EXCEED head-to-head trial comparing Cosentyx (secukinumab) to Humira (adalimumab), of AbbVie Inc., in patients with active psoriatic arthritis or PsA.
While Cosentyx narrowly missed statistical significance for superiority in ACR 20, the primary endpoint of the EXCEED trial, it showed numerically higher results versus Humira.
Statistically significant advantages of Cosentyx versus Humira in PsA-specific endpoints were observed in a pre-specified sensitivity analysis. The trial demonstrated a consistent and favorable safety profile for Cosentyx in line with previous clinical trials. No new safety signals were detected.
Eric Hughes, Global Development Unit Head, Immunology, Hepatology & Dermatology said, "EXCEED is the first ever monotherapy head-to-head trial with a primary endpoint in psoriatic arthritis specific to joints. ...We will assess the EXCEED data in their totality and we view the results as confirming our vision of Cosentyx becoming standard of care in psoriatic arthritis."
The company noted that Cosentyx is the only biologic with proven efficacy in all key manifestations of psoriatic arthritis and is backed by 5-year sustained efficacy and consistent safety data across psoriatic arthritis, ankylosing spondylitis and psoriasis. To date, over 250,000 patients have been treated worldwide.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In a statement, the company announced results from the EXCEED head-to-head trial comparing Cosentyx (secukinumab) to Humira (adalimumab), of AbbVie Inc., in patients with active psoriatic arthritis or PsA. (RTTNews) - Swiss drug major Novartis AG (NVS) announced Friday that Cosentyx shows encouraging results versus Humira from first-of-its-kind head-to-head trial in psoriatic arthritis. Eric Hughes, Global Development Unit Head, Immunology, Hepatology & Dermatology said, "EXCEED is the first ever monotherapy head-to-head trial with a primary endpoint in psoriatic arthritis specific to joints. | In a statement, the company announced results from the EXCEED head-to-head trial comparing Cosentyx (secukinumab) to Humira (adalimumab), of AbbVie Inc., in patients with active psoriatic arthritis or PsA. (RTTNews) - Swiss drug major Novartis AG (NVS) announced Friday that Cosentyx shows encouraging results versus Humira from first-of-its-kind head-to-head trial in psoriatic arthritis. While Cosentyx narrowly missed statistical significance for superiority in ACR 20, the primary endpoint of the EXCEED trial, it showed numerically higher results versus Humira. | In a statement, the company announced results from the EXCEED head-to-head trial comparing Cosentyx (secukinumab) to Humira (adalimumab), of AbbVie Inc., in patients with active psoriatic arthritis or PsA. (RTTNews) - Swiss drug major Novartis AG (NVS) announced Friday that Cosentyx shows encouraging results versus Humira from first-of-its-kind head-to-head trial in psoriatic arthritis. The company noted that Cosentyx is the only biologic with proven efficacy in all key manifestations of psoriatic arthritis and is backed by 5-year sustained efficacy and consistent safety data across psoriatic arthritis, ankylosing spondylitis and psoriasis. | In a statement, the company announced results from the EXCEED head-to-head trial comparing Cosentyx (secukinumab) to Humira (adalimumab), of AbbVie Inc., in patients with active psoriatic arthritis or PsA. (RTTNews) - Swiss drug major Novartis AG (NVS) announced Friday that Cosentyx shows encouraging results versus Humira from first-of-its-kind head-to-head trial in psoriatic arthritis. While Cosentyx narrowly missed statistical significance for superiority in ACR 20, the primary endpoint of the EXCEED trial, it showed numerically higher results versus Humira. |
24840.0 | 2019-10-31 00:00:00 UTC | Noteworthy Thursday Option Activity: ABBV, BLD, BCOV | ABBV | https://www.nasdaq.com/articles/noteworthy-thursday-option-activity%3A-abbv-bld-bcov-2019-10-31 | nan | nan | Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 34,952 contracts has been traded thus far today, a contract volume which is representative of approximately 3.5 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 52.8% of ABBV's average daily trading volume over the past month, of 6.6 million shares. Especially high volume was seen for the $81 strike call option expiring November 01, 2019, with 3,090 contracts trading so far today, representing approximately 309,000 underlying shares of ABBV. Below is a chart showing ABBV's trailing twelve month trading history, with the $81 strike highlighted in orange:
TopBuild Corp (Symbol: BLD) saw options trading volume of 1,250 contracts, representing approximately 125,000 underlying shares or approximately 52% of BLD's average daily trading volume over the past month, of 240,395 shares. Particularly high volume was seen for the $100 strike put option expiring January 17, 2020, with 255 contracts trading so far today, representing approximately 25,500 underlying shares of BLD. Below is a chart showing BLD's trailing twelve month trading history, with the $100 strike highlighted in orange:
And Brightcove Inc (Symbol: BCOV) saw options trading volume of 923 contracts, representing approximately 92,300 underlying shares or approximately 49.9% of BCOV's average daily trading volume over the past month, of 184,980 shares. Especially high volume was seen for the $10 strike call option expiring April 17, 2020, with 833 contracts trading so far today, representing approximately 83,300 underlying shares of BCOV. Below is a chart showing BCOV's trailing twelve month trading history, with the $10 strike highlighted in orange:
For the various different available expirations for ABBV options, BLD options, or BCOV options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Especially high volume was seen for the $81 strike call option expiring November 01, 2019, with 3,090 contracts trading so far today, representing approximately 309,000 underlying shares of ABBV. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 34,952 contracts has been traded thus far today, a contract volume which is representative of approximately 3.5 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 52.8% of ABBV's average daily trading volume over the past month, of 6.6 million shares. | Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 34,952 contracts has been traded thus far today, a contract volume which is representative of approximately 3.5 million underlying shares (given that every 1 contract represents 100 underlying shares). Below is a chart showing ABBV's trailing twelve month trading history, with the $81 strike highlighted in orange: TopBuild Corp (Symbol: BLD) saw options trading volume of 1,250 contracts, representing approximately 125,000 underlying shares or approximately 52% of BLD's average daily trading volume over the past month, of 240,395 shares. That number works out to 52.8% of ABBV's average daily trading volume over the past month, of 6.6 million shares. | Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 34,952 contracts has been traded thus far today, a contract volume which is representative of approximately 3.5 million underlying shares (given that every 1 contract represents 100 underlying shares). Below is a chart showing ABBV's trailing twelve month trading history, with the $81 strike highlighted in orange: TopBuild Corp (Symbol: BLD) saw options trading volume of 1,250 contracts, representing approximately 125,000 underlying shares or approximately 52% of BLD's average daily trading volume over the past month, of 240,395 shares. That number works out to 52.8% of ABBV's average daily trading volume over the past month, of 6.6 million shares. | Below is a chart showing ABBV's trailing twelve month trading history, with the $81 strike highlighted in orange: TopBuild Corp (Symbol: BLD) saw options trading volume of 1,250 contracts, representing approximately 125,000 underlying shares or approximately 52% of BLD's average daily trading volume over the past month, of 240,395 shares. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 34,952 contracts has been traded thus far today, a contract volume which is representative of approximately 3.5 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 52.8% of ABBV's average daily trading volume over the past month, of 6.6 million shares. |
24841.0 | 2019-10-31 00:00:00 UTC | 3 Breakout Stocks to Buy for the Rest of 2019 | ABBV | https://www.nasdaq.com/articles/3-breakout-stocks-to-buy-for-the-rest-of-2019-2019-10-31 | nan | nan | The current sentiment on Wall Street is completely different than this time last year. Back then, the Federal Reserve had mistakenly spooked investors into thinking they would continue their rate hike cycle in spite of softening economies. Things are much different in 2019. Case in point: Yesterday the Fed cut rates for the third time. This gives the equity bulls an advantage — which means there are some breakout stocks to buy into year-end. Today we examine CVS (NYSE:), AbbVie (NYSE:) and Square (NYSE:).
All three stocks are lagging so they are not intuitively stocks to chase. But they each have reasons that are compelling enough to watch for triggers.
Breakout Stocks to Buy: CVS (CVS)
CVS stock has had a difficult 12 months. In fact, since it hit its $113 highs in August 2015, it has been sliding for four years. It finally seems to have bottomed in May of this year. Since then, the stock has set higher lows and higher highs until it hit the $65 per share neckline. This is a natural resistance line since it was a ledge at least two times this year, once in February and a second time in September.
But finally, last week the CVS stock bulls broke above the resistance and now are pricing in a bullish pattern with a target near $75 per share. There will be strong resistance at $70 since that too was a failure point at least twice this year. If the markets continue their breakout into record territory, then CVS should also continue its recovery rally.
The company reports earnings next week, and that will bring about a guessing game. It would be best to lock in the profits ahead of earnings, or else this trade could turn into an investment.
AbbVie (ABBV)
Similarly to CVS, ABBV stock is also facing the opportunity of a bullish pattern breakout. If the buyers can overcome the resistance around $80 per share then they could invite more momentum for a $15 run. It won’t be easy since the area above current levels is a prior ledge and a well-consolidated zone. This usually means that the fight will be hard as buyers come to it from below.
There are reasons to be skeptical despite the enticing trigger line. So far this year ABBV stock is down 14% when the S&P 500 just set a new all-time high. Clearly, Wall Street has issues with the chart so far. But it is best to set the alerts on the charts then act once the triggers happen. Only when there is confirmation that the breakout is afoot is this trade valid — if traders fail to wait for confirmation, they’ll be stuck hoping things go their way. This would be more hopium than actual strategy.
To add uncertainty to this setup is the fact that ABBV’s management reports earnings on Nov. 1. The short-term reactions to reports are binary. Long term, the fundamentals will matter, but for the short term it is more about the headline and the technicals on the chart. As long as the price is above $74 per share, the bulls remain in control of this ascending trend.
Square (SQ)
SQ stock has lagged Visa (NYSE:) and Mastercard (NYSE:) all year. But SQ used to be the fast mover of the bunch. The financial technology sector is still as hot as ever. The global transition into electronic transactions is still in its infancy. So companies like SQ have a long way to go. Yet, the stock so far has failed to recover its highs.
Year-to-date, SQ stock is only up 10% whereas Visa and Mastercard are up over four times more. Clearly there is unmet potential in SQ. But having it linger this low for so long establishes a base. Including the Christmas correction, SQ stock has held well above the $56 per share zone. Moreover, the bulls have been in charge since the September lows setting higher-lows and knocking on a neckline. If the buyers can break out from $64.75 they could trigger a bullish pattern to target a $6 run. From there, SQ would be close enough to stir up thoughts of filling the gap to $80 per share.
Earnings are coming soon so this adds another layer of guessing. The short-term reaction will depend on expectations. In the long run, unless management flubs in a massive way, SQ stock will rise along with the markets.
Nicolas Chahine is the managing director of . As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Today we examine CVS (NYSE:), AbbVie (NYSE:) and Square (NYSE:). AbbVie (ABBV) Similarly to CVS, ABBV stock is also facing the opportunity of a bullish pattern breakout. So far this year ABBV stock is down 14% when the S&P 500 just set a new all-time high. | Today we examine CVS (NYSE:), AbbVie (NYSE:) and Square (NYSE:). AbbVie (ABBV) Similarly to CVS, ABBV stock is also facing the opportunity of a bullish pattern breakout. So far this year ABBV stock is down 14% when the S&P 500 just set a new all-time high. | Today we examine CVS (NYSE:), AbbVie (NYSE:) and Square (NYSE:). AbbVie (ABBV) Similarly to CVS, ABBV stock is also facing the opportunity of a bullish pattern breakout. So far this year ABBV stock is down 14% when the S&P 500 just set a new all-time high. | So far this year ABBV stock is down 14% when the S&P 500 just set a new all-time high. Today we examine CVS (NYSE:), AbbVie (NYSE:) and Square (NYSE:). AbbVie (ABBV) Similarly to CVS, ABBV stock is also facing the opportunity of a bullish pattern breakout. |
24842.0 | 2019-10-29 00:00:00 UTC | Can New Drugs Help Gilead Sciences Rebound? | ABBV | https://www.nasdaq.com/articles/can-new-drugs-help-gilead-sciences-rebound-2019-10-29 | nan | nan | Gilead Sciences (NASDAQ: GILD) put up a rather lackluster third-quarter report last week. Revenue was flat year over year, dragged down by a 20% decline in sales of its hepatitis C franchise, as well as lower sales of angina drug Ranexa and pulmonary arterial hypertension drug Letairis as both drugs face generic competition.
But management at the big biotech still has high hopes of turning things around with its newer medications.
Yescarta: Short-term issues, long-term winner?
CFO Robin Washington talked about the company's CAR T drug, Yescarta, which Gilead acquired in a 2017 deal with Kite Pharma:
It is clear that cell therapy is a validated platform with hundreds of patients being treated on a quarterly basis in the US. Yescarta has established itself as a differentiated leader in an increasingly competitive environment. We will continue to focus our efforts on CAR T education in the community oncology setting to stimulate referrals of appropriate patients to cell therapy treatment centers.
We also observe CAR T eligible patients being enrolled in clinical trials at a much higher rate relative to commercial patients. As such, and as [CEO Daniel O'Day] outlined, we anticipate further quarterly sales variations, but remain very confident in the future trajectory of Yescarta.
Basically, Yescarta has captured the low-hanging fruit in doctors at research institutions that are likely to quickly adopt new technology, and Gilead has moved into community oncologists, who take longer to convert and are more spread out.
Unfortunately, Gliead has no control over the second headwind: competition with clinical trials. The best solution is to move into earlier-stage patients where there are fewer therapies being tested, but that'll take time to gain regulatory approvals for earlier-stage patients.
Image source: Getty Images.
Switching
Gilead has done well switching HIV patients from tenofovir disoproxil fumarate (TDF)-containing regimens to those that contain tenofovir alafenamide fumarate (TAF), a related molecule that has fewer side effects. The switching -- and capturing of new patients -- drove HIV sales 13% higher during the third quarter, which helped keep overall revenue flat year over year.
Gilead's newest TAF-containing offering, Descovy, was approved by the Food and Drug Administration as a pre-exposure prophylaxis (PrEP) to try and prevent HIV infection.
Chief Commercial Officer Johanna Mercier laid out the plan to convince doctors to switch patients from TDF-containing Truvada to Descovy and the challenges of switching patients at risk for HIV infection compared to the smaller population of patients being treated for HIV:
The PrEP market is a little bit different than the treatment market and that it is much larger in the number of prescribers. So, there's over 50,000 prescribers that have actually written at least one script of PrEP with Truvada. So having said that, more than half of the volume that we're seeing in PrEP is actually very concentrated in a couple of thousand specialists who also prescribe in treatment. So that has been our number one focus and target physicians that we have been calling on over the last couple of weeks because these are folks that obviously largest volume pool, but also folks that have experienced converting from TDF to TAF and also understand the value of Descovy and its clinical profile specifically around the safety with bone and renal.
High hopes for a pipeline candidate
Mercier also talked about Janus kinase (JAK) inhibitor filgotinib, which is under review by regulators in the EU and Japan and will be submitted to the FDA by the end of the year as a treatment for rheumatoid arthritis. The drug faces competition from already-approved JAK inhibitors, Eli Lilly's (NYSE: LLY) Olumiant, Pfizer's (NYSE: PFE) Xeljanz, and AbbVie's (NYSE: ABBV) Rinvoq, but Mercier thinks filgotinib could have an edge:
One of the things that I would say is the importance of our data and I think that if you look at the results of the three FINCH 3 studies in three different patient groups, those are really exciting for us, both from an efficacy standpoint as well as safety standpoint.
So a lot of the work that's being done right now is sub-analysis to ensure that we can better educate physicians about our data. So that's kind of the plan there. And I do think that the opportunity here is to potentially have a best-in-class JAK inhibitor in that could be also related to the sole activity of the JAK1.
While Olumiant and Xeljanz target multiple members of the JAK family, filgotinib is selective for JAK1, which could give it an edge. Unfortunately, Gilead will still have to compete with Rinvoq, which also targets JAK1 selectively.
Biggest opportunity?
Of the three, Descovy offers the biggest near-term upside. Yescarta faces some near-term issues, but the drug -- and the rest of CAR T pipeline -- should help expand Gilead's sales in the future. Filgotinib is a bit of a wild card; rheumatoid arthritis is a big opportunity, but the drug faces stiff competition from other JAK inhibitors, as well as other established rheumatoid arthritis drugs in other classes.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The drug faces competition from already-approved JAK inhibitors, Eli Lilly's (NYSE: LLY) Olumiant, Pfizer's (NYSE: PFE) Xeljanz, and AbbVie's (NYSE: ABBV) Rinvoq, but Mercier thinks filgotinib could have an edge: One of the things that I would say is the importance of our data and I think that if you look at the results of the three FINCH 3 studies in three different patient groups, those are really exciting for us, both from an efficacy standpoint as well as safety standpoint. CFO Robin Washington talked about the company's CAR T drug, Yescarta, which Gilead acquired in a 2017 deal with Kite Pharma: It is clear that cell therapy is a validated platform with hundreds of patients being treated on a quarterly basis in the US. Basically, Yescarta has captured the low-hanging fruit in doctors at research institutions that are likely to quickly adopt new technology, and Gilead has moved into community oncologists, who take longer to convert and are more spread out. | The drug faces competition from already-approved JAK inhibitors, Eli Lilly's (NYSE: LLY) Olumiant, Pfizer's (NYSE: PFE) Xeljanz, and AbbVie's (NYSE: ABBV) Rinvoq, but Mercier thinks filgotinib could have an edge: One of the things that I would say is the importance of our data and I think that if you look at the results of the three FINCH 3 studies in three different patient groups, those are really exciting for us, both from an efficacy standpoint as well as safety standpoint. Switching Gilead has done well switching HIV patients from tenofovir disoproxil fumarate (TDF)-containing regimens to those that contain tenofovir alafenamide fumarate (TAF), a related molecule that has fewer side effects. Filgotinib is a bit of a wild card; rheumatoid arthritis is a big opportunity, but the drug faces stiff competition from other JAK inhibitors, as well as other established rheumatoid arthritis drugs in other classes. | The drug faces competition from already-approved JAK inhibitors, Eli Lilly's (NYSE: LLY) Olumiant, Pfizer's (NYSE: PFE) Xeljanz, and AbbVie's (NYSE: ABBV) Rinvoq, but Mercier thinks filgotinib could have an edge: One of the things that I would say is the importance of our data and I think that if you look at the results of the three FINCH 3 studies in three different patient groups, those are really exciting for us, both from an efficacy standpoint as well as safety standpoint. Chief Commercial Officer Johanna Mercier laid out the plan to convince doctors to switch patients from TDF-containing Truvada to Descovy and the challenges of switching patients at risk for HIV infection compared to the smaller population of patients being treated for HIV: The PrEP market is a little bit different than the treatment market and that it is much larger in the number of prescribers. Filgotinib is a bit of a wild card; rheumatoid arthritis is a big opportunity, but the drug faces stiff competition from other JAK inhibitors, as well as other established rheumatoid arthritis drugs in other classes. | The drug faces competition from already-approved JAK inhibitors, Eli Lilly's (NYSE: LLY) Olumiant, Pfizer's (NYSE: PFE) Xeljanz, and AbbVie's (NYSE: ABBV) Rinvoq, but Mercier thinks filgotinib could have an edge: One of the things that I would say is the importance of our data and I think that if you look at the results of the three FINCH 3 studies in three different patient groups, those are really exciting for us, both from an efficacy standpoint as well as safety standpoint. Chief Commercial Officer Johanna Mercier laid out the plan to convince doctors to switch patients from TDF-containing Truvada to Descovy and the challenges of switching patients at risk for HIV infection compared to the smaller population of patients being treated for HIV: The PrEP market is a little bit different than the treatment market and that it is much larger in the number of prescribers. Yescarta faces some near-term issues, but the drug -- and the rest of CAR T pipeline -- should help expand Gilead's sales in the future. |
24843.0 | 2019-10-26 00:00:00 UTC | 5 Top Healthcare ETFs | ABBV | https://www.nasdaq.com/articles/5-top-healthcare-etfs-2019-10-26 | nan | nan | Healthcare is huge. In 2017, healthcare spending in the U.S. totaled $3.5 trillion -- nearly 18% of the country's gross domestic product (GDP), which is the total market value of all products and services produced. Worldwide healthcare spending topped $7.7 billion. By 2022, global healthcare spending will reach at least $10 trillion, according to professional services firm Deloitte.
Where there's a lot of money being spent, there are opportunities for investors. While one option is to buy individual healthcare stocks, many investors might prefer going with healthcare-focused exchange-traded funds (ETFs), which let you buy a basket of stocks with one transaction. But you don't want to buy just any healthcare ETF. Here's what you need to know about the top healthcare ETFs and why investing in them is something you should consider.
Image source: Getty Images.
Why healthcare is hot
Probably the most important trend fueling growth in healthcare is the aging of populations across the world. In the U.S., around 10,000 baby boomers turn 65 every day. By 2030, all of the 61 million American baby boomers will be at least 65 years old. By 2034, Americans 65 and older will outnumber those under 18 for the first time in U.S. history, according to projections from the U.S. Census Bureau.
In Europe, 1 out of every 4 residents already is at least 60 years old. Lower birth rates in Europe mean that populations will age even more rapidly than in the U.S. It's a similar story in Asia, with a United Nations report finding that "all countries in Asia and the Pacific are in the process of aging at an unprecedented pace."
As people age, they're more likely to require healthcare services. And as demand rises, companies that provide products and services to address healthcare issues for aging populations should benefit.
In addition, significant advances are being made in healthcare and new technology is likely to generate tremendous growth for pioneering companies.
For example, drugmakers are developing new approaches that could revolutionize how diseases are treated. The use of personalized medicine, where individuals' genetic information is used to determine the appropriate therapy, is picking up momentum. This is especially true in cancer treatment, where hundreds of immunotherapies that harness the body's immune system to fight cancer are in clinical testing, with several immunotherapies already on the market. Biotechs and pharmaceutical companies are even using gene editing to cure rare genetic diseases that in the past had no effective treatment available.
Diagnostics companies are developing ways to detect cancer at early stages using liquid biopsies that identify fragments of DNA that have broken off from tumors and made their way into patients' blood. Medical device companies are launching new devices that use artificial intelligence, robotics, and other advanced technology to improve the delivery of healthcare services.
There's also a major focus among healthcare companies to provide products and services that help control the rising costs that are associated with higher demand. The use of telehealth -- the delivery of healthcare services remotely using technology, especially the internet -- is being adopted more widely. Surgical robots are being used to perform minimally invasive surgeries that in the past required much more complicated and risky procedures. Technology to monitor patients with chronic conditions and alert healthcare professionals when issues arise is helping reduce expensive hospital visits.
Rapidly growing demand fueled by aging populations across the world. Amazing new innovations that are revolutionizing patient care. It's no wonder that healthcare is a hot area for investors.
Why use ETFs to invest in healthcare
There's one big reason why using an ETF to invest in healthcare is a great idea: It provides diversification across lots of individual healthcare stocks. Each of the top five healthcare ETFs holds positions in at least 57 stocks, with three of the ETFs holding more than 100 stocks.
This diversification across multiple stocks lowers the amount of risk taken by investors. If only a small number of individual stocks drop significantly, the rest of the stocks owned by the ETF can offset those declines. Because the healthcare sector is so broad in scope, all healthcare stocks don't necessarily move in the same direction all of the time. For example, regulations specific to medical device makers could hurt medical device stocks but not impact pharmaceutical stocks at all.
Using ETFs also enables investors to target specific industries within healthcare. For example, some healthcare ETFs focus only on biotech stocks or medical device stocks rather than the entire healthcare sector. Of course, you do lose some of the benefits of diversification by investing in these industry-specific ETFs.
So now that you know that ETFs offer the advantage of investing in a wide range of stocks in one fell swoop, let's look at which healthcare ETFs are especially popular.
Five top healthcare ETFs
An important metric for healthcare ETFs is their assets under management. This refers to the total market value (how much a stock or other holding can be sold for) of all the financial assets that the ETF manages on behalf of its clients. The larger the assets under management, the more money investors have poured into the ETF, which reflects a broad level of confidence in the ETF. The five top healthcare ETFs -- as measured by assets under management -- are:
Data sources: Fund companies. All data as of Oct. 17, 2019.
Health Care Select Sector SPDR Fund
The Health Care Select Sector SPDR Fund is managed by State Street Global Advisors. This ETF attempts to track the performance of the Health Care Select Sector Index, which includes all of the stocks in the healthcare sector that are listed in the broader S&P 500 index.
The ETF provides exposure for investors to stocks in multiple healthcare industries, including biotechnology, healthcare equipment and supplies, healthcare providers and services, healthcare technology, life sciences tools and services, and pharmaceuticals. The top holdings of the Health Care Select Sector SPDR Fund in terms of market value as of October 2019 include Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Laboratories, Medtronic, Amgen, Thermo Fischer Scientific, AbbVie, and Eli Lilly.
Since its inception in 1998, the Health Care Select SPDR Fund has delivered an average annual return of 8.07%. Over the last three years and five years, the ETF has provided average annual returns of 9.44% and 8.92%, respectively.
Many of the stocks held by the Health Care Select SPDR Fund pay dividends. As a result, the ETF offers an attractive dividend yield (annual dividend payments expressed as a percentage of the ETF's net asset value per share over the last 12 months) of 1.62%. This dividend yield more than offsets the ETF's low expense ratio (the fund's operating expenses divided by the average total dollar value of its managed assets) of 0.13%. ETFs deduct these expense ratios from investors' accounts.
Vanguard Health Care Index Fund ETF
Vanguard pioneered the use of ETFs. The company's biggest healthcare ETF in terms of assets under management is the Vanguard Health Care Index Fund ETF, which tracks the performance of the MSCI U.S. Investable Market Index (IMI)/Health Care 25/50. This benchmark index consists of stocks of large, midsize, and small U.S. healthcare companies based on market cap (the total dollar value of a company's shares).
The Vanguard Health Care Index Fund ETF primarily holds positions in the stocks of companies that provide medical or healthcare products, services, technology, or equipment. Like the Health Care Select SPDR Fund, the ETF's largest holdings as of October 2019 are Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Labs, Medtronic, Amgen, Thermo Fisher Scientific, AbbVie, and Eli Lilly.
This healthcare ETF has generated an average annual return of 9.47% since its launch in 2004. It has delivered average annual returns of 9.78% and 9.2% over the last three years and five years, respectively.
The Vanguard Health Care Index Fund ETF currently offers a dividend yield of 2.1%. Its expense ratio of 0.10% ranks as one of the lowest among all ETFs.
iShares Nasdaq Biotechnology ETF
The iShares Nasdaq Biotechnology ETF is managed by BlackRock. This ETF attempts to track the performance of the Nasdaq Biotechnology Index, which consists of U.S. biotechnology and pharmaceutical stocks that are listed on the Nasdaq stock exchange.
As its name indicates, the ETF focuses mainly on biotech stocks. Its largest holdings as of October 2019 include Amgen, Gilead Sciences, Celgene, Vertex Pharmaceuticals, Illumina, Biogen, Regeneron Pharmaceuticals, Alexion Pharmaceuticals, Incyte, and Seattle Genetics.
Since its launch in 2001, the iShares Nasdaq Biotechnology ETF has provided investors an average annual return of 6.2%. Over the last three years, the ETF has delivered an average annual return of 1.29%. The average annual return over the last five years was 1.97%.
Most biotech stocks don't pay dividends. It's not surprising, therefore, that the iShares Nasdaq Biotechnology ETF's dividend yield of 0.27% is much lower than the yields offered by ETFs that target the broader healthcare sector. The ETF's expense ratio of 0.47% is also higher than the ETFs that own holdings in more stocks across the healthcare spectrum.
iShares U.S. Medical Devices ETF
BlackRock also manages the iShares U.S. Medical Devices ETF. This ETF attempts to track the performance of the Dow Jones U.S. Select Medical Equipment Index, which includes selected medical equipment stocks.
The iShares U.S. Medical Devices ETF focuses only on stocks of companies that derive all or a significant portion of their total revenue by selling medical devices. The ETF's largest holdings as of October 2019 include Abbott Labs, Medtronic, Thermo Fisher Scientific, Danaher, Edwards Lifesciences, Stryker, Becton Dickinson and Co., Baxter International, Intuitive Surgical, and Boston Scientific.
BlackRock launched the iShares U.S. Medical Devices ETF in 2006. Since then, the ETF has delivered an average annual return of 13.17%. Over the last three years and five years, it has provided annual average returns of 19.83% and 20.71%, respectively.
This ETF's dividend yield currently stands at 0.3%. That level is nearly enough to cover the ETF's expense ratio of 0.43%.
SPDR S&P Biotech ETF
State Street's SPDR S&P Biotech ETF attempts to track the performance of the biotechnology segment of the S&P Total Market Index, which tracks the broader U.S. equity market.
While the iShares Nasdaq Biotechnology ETF and the SPDR S&P Biotech ETF both focus on biotech stocks, their top holdings are very different. The SPDR S&P Biotech ETF includes larger positions in small and midsize biotechs than the iShares ETF does. The largest holdings of the SPDR S&P Biotech ETF as of October 2019 are Seattle Genetics, Arrowhead Pharmaceuticals, The Medicines Company, Ligand Pharmaceuticals, Regeneron, AbbVie, Amgen, Celgene, Incyte, and United Therapeutics.
Since the inception of the SPDR S&P Biotech ETF in 2006, the ETF has generated an average annual return of 12.21%. Over the last three years, the ETF's average annual return was 4.96%. It delivered an average annual return of 8.33% over the last five years.
You might think that an ETF with a lot of relatively smaller biotech stocks among its holdings would have a low dividend yield -- and you'd be right. The SPDR S&P Biotech ETF's dividend yield of 0.02% is the lowest of these five top healthcare ETFs. The ETF's expense ratio of 0.35% is in the middle of the pack for the top healthcare ETFs.
Why consider these healthcare ETFs?
One key reason to consider investing in these five healthcare ETFs is that they claim strong average trading volumes (the average of how many shares are bought and sold over a given period). This means that there is plenty of liquidity, a term that refers to how quickly an asset can be bought or sold without affecting its price. You want high-liquidity investments in case you need to sell in a hurry.
And while your eyes might have glossed over reading about the expense ratios, they're important. The lower expense ratios for these ETFs boost investment returns over time.
Should you just buy the healthcare ETF with the highest lifetime return? Nope. For one thing, future returns might not correlate with past returns. Also, these ETFs have different approaches. If you don't want to focus only on medical device stocks, you wouldn't want to go with the iShares U.S. Medical Devices ETF even though it claims the highest lifetime return.
Risks
Although buying a healthcare ETF reduces the risks for investors by diversifying across multiple stocks, there are still a number of key risks for these ETFs. Several, for example, have relatively large positions in certain stocks. If these stocks decline, they could cause the ETF to fall as well.
Abbott Labs makes up 13.53% of the total holdings of the iShares U.S. Medical Devices ETF. Johnson & Johnson makes up 10.14% and 8.6% of the Health Care Select Sector SPDR Fund and the Vanguard Health Care ETF, respectively. Over 9% of the iShares Nasdaq Biotechnology ETF is held in Amgen stock.
These heavy weightings make these ETFs especially susceptible to risks that could impact these stocks. Abbott Labs' growth prospects could be hurt if it fails to win U.S. Food and Drug Administration (FDA) approval for its next version of the Freestyle Libre continuous glucose monitoring (CGM) system. Johnson & Johnson and Amgen face competition from biosimilar and generic rivals, which could negatively affect the companies' growth prospects.
The good news, though, is that ETFs adjust their holdings as they see the need to do so. An ETF that suffers over the short term due to a large position in a stock that doesn't perform well can still be a winner over the long term.
All of the top five healthcare ETFs could also experience significant declines as a result of major changes to the U.S. healthcare system. Biotechs and pharmaceutical stocks could feel the brunt of potential reforms to how drug prices are set, which could pull down all of the ETFs except the iShares U.S. Medical Devices ETF.
But this ETF isn't immune from the negative effects of potential U.S. healthcare system changes. There is significant political support for a single-payer healthcare system in the U.S. It's possible that nearly every healthcare stock could experience declines -- and weigh on healthcare ETFs as well -- if considerable progress is made toward implementing such a system.
Healthcare ETFs can withstand overall economic downturns better than many stocks since healthcare products and services usually are needed regardless of what's going on with the economy, however, that doesn't mean that they can't fall during a recession or broader market pullback.
In 2008, for example, each of these five healthcare ETFs dropped by double-digit percentages at one point during the toughest part of the financial crisis. Two of these ETFs -- the iShares Nasdaq Biotechnology ETF and the SPDR S&P Biotech ETF -- ended down for the year and underperformed the broader S&P 500.
Positives outweigh the negatives
Despite these risks, the positives should outweigh the negatives for healthcare ETFs. The aging demographic trends discussed earlier will almost certainly drive higher demand for healthcare products and services over the long run.
While some companies might not fare as well as others, the indexes tracked by these ETFs follow the rules of survival of the fittest. If individual stocks underperform too much, they'll be replaced in the indexes (and in the ETFs' holdings) by better-performing stocks.
It's not a bad idea to invest in healthcare stocks that appear to be in the best position to succeed over the long run. But for investors who either don't want to do the research required to pick individual stocks or who prefer the lower risk resulting from diversification, healthcare ETFs are a great option.
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Keith Speights owns shares of AbbVie, Celgene, Gilead Sciences, Health Care SPDR, Illumina, Intuitive Surgical, Pfizer, SPDR S&P Biotech, and Vertex Pharmaceuticals. The Motley Fool owns shares of and recommends Biogen, Celgene, Gilead Sciences, Illumina, Intuitive Surgical, and Seattle Genetics. The Motley Fool recommends Amgen, Becton, Dickinson, Incyte, Johnson & Johnson, Nasdaq, UnitedHealth Group, and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The top holdings of the Health Care Select Sector SPDR Fund in terms of market value as of October 2019 include Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Laboratories, Medtronic, Amgen, Thermo Fischer Scientific, AbbVie, and Eli Lilly. Like the Health Care Select SPDR Fund, the ETF's largest holdings as of October 2019 are Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Labs, Medtronic, Amgen, Thermo Fisher Scientific, AbbVie, and Eli Lilly. The largest holdings of the SPDR S&P Biotech ETF as of October 2019 are Seattle Genetics, Arrowhead Pharmaceuticals, The Medicines Company, Ligand Pharmaceuticals, Regeneron, AbbVie, Amgen, Celgene, Incyte, and United Therapeutics. | The top holdings of the Health Care Select Sector SPDR Fund in terms of market value as of October 2019 include Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Laboratories, Medtronic, Amgen, Thermo Fischer Scientific, AbbVie, and Eli Lilly. Like the Health Care Select SPDR Fund, the ETF's largest holdings as of October 2019 are Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Labs, Medtronic, Amgen, Thermo Fisher Scientific, AbbVie, and Eli Lilly. The largest holdings of the SPDR S&P Biotech ETF as of October 2019 are Seattle Genetics, Arrowhead Pharmaceuticals, The Medicines Company, Ligand Pharmaceuticals, Regeneron, AbbVie, Amgen, Celgene, Incyte, and United Therapeutics. | The top holdings of the Health Care Select Sector SPDR Fund in terms of market value as of October 2019 include Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Laboratories, Medtronic, Amgen, Thermo Fischer Scientific, AbbVie, and Eli Lilly. Like the Health Care Select SPDR Fund, the ETF's largest holdings as of October 2019 are Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Labs, Medtronic, Amgen, Thermo Fisher Scientific, AbbVie, and Eli Lilly. The largest holdings of the SPDR S&P Biotech ETF as of October 2019 are Seattle Genetics, Arrowhead Pharmaceuticals, The Medicines Company, Ligand Pharmaceuticals, Regeneron, AbbVie, Amgen, Celgene, Incyte, and United Therapeutics. | The top holdings of the Health Care Select Sector SPDR Fund in terms of market value as of October 2019 include Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Laboratories, Medtronic, Amgen, Thermo Fischer Scientific, AbbVie, and Eli Lilly. Like the Health Care Select SPDR Fund, the ETF's largest holdings as of October 2019 are Johnson & Johnson, UnitedHealth Group, Merck, Pfizer, Abbott Labs, Medtronic, Amgen, Thermo Fisher Scientific, AbbVie, and Eli Lilly. The largest holdings of the SPDR S&P Biotech ETF as of October 2019 are Seattle Genetics, Arrowhead Pharmaceuticals, The Medicines Company, Ligand Pharmaceuticals, Regeneron, AbbVie, Amgen, Celgene, Incyte, and United Therapeutics. |
24844.0 | 2019-10-25 00:00:00 UTC | Don’t Sleep on These 2 Pharmaceutical Stocks | ABBV | https://www.nasdaq.com/articles/dont-sleep-on-these-2-pharmaceutical-stocks-2019-10-25 | nan | nan | It hasn't been a great year for pharma companies. The industry, as measured by the SPDR S&P Pharmaceuticals Index, is up less than 1.5% since the beginning of the year, a period during which the S&P has gained about 18%. And some big players have had it far worse. Case in point: AbbVie (NYSE: ABBV) stock is down by 13% year to date, while Eli Lilly (NYSE: LLY) shares are down by 7%.
Both have faced company-specific obstacles, but despite their recently lackluster performances, there are good reasons to think these pharma giants could stage amazing comebacks.
More than Humira
AbbVie has become practically synonymous with Humira, and with good reason. The drugmaker's best-selling treatment has generated a majority of its revenues in recent years. Last year, for example, sales of Humira came in at $13.6 billion -- 63.5% of AbbVie's adjusted net revenues. However, the U.S. patent on the biologic expired in 2016, and low-cost biosimilars were introduced in Europe late last year, which means that its international sales are destined to decline. Further, while Humira will continue to dominate the U.S. immunology market in the near future, biosimilars will likely be introduced domestically by 2023.
IMAGE SOURCE: GETTY IMAGES
With that said, there are still good reasons why AbbVie deserves to be on your watch list. Let's consider three of them.
The company can rely on other drugs to pick up some of the revenue-generating load, among them Skyrizi, Venclexta, and Imbruvica. Skyrizi, a medicine for moderate to severe plaque psoriasis, was approved in both the U.S. and Europe in April, and generated $42 million in revenues during the second quarter. Venclexta and Imbruvica have been generating solid revenues too. During the second quarter, their combined sales were $1.2 billion, a 35.5% year-over-year jump. But Venclexta received another U.S. Food and Drug Administration approval in May, enlarging its pool of potential patients.
AbbVie recently acquired Allergan for about $63 billion, a blockbuster deal that strengthened its portfolio of drugs and gave it more avenues to find new potentially high-revenue treatments.
AbbVie offers investors a healthy dividend that currently yields about 5.7%, and has raised its quarterly payout by 167.5% since 2013.
Pinning its hopes to the Loxo acquisition
Eli Lilly, too, is best known for its top-selling drug -- in its case, Trulicity. The GLP1 agonist continues to perform relatively well. During the third quarter, sales of Trulicity were $1.011 billion, 24% higher than in last year's third quarter. However, whether (and to what extent) Eli Lilly will be able to keep counting on Trulicity for strong top-line growth isn't clear. With the company fighting for market share with competitor Novo Nordisk, sales of Trulicity may not continue on the same upward trajectory for long. Further, Taltz -- a key member of Eli Lilly's immunology lineup -- is also facing strong competition. During Q3, sales of Taltz were $340 million. Although that represented a 29% year-over-year growth, it was below analysts' consensus estimate.
Fortunately, Eli Lilly has a strategy to counter those headwinds. Earlier this year, it acquired drug-maker Loxo Oncology for $8 billion in cash. Although it paid a significant premium, the purchase will help the pharma company expand its footprint in the oncology market. In particular, it gained access to Vitrakvi, a specialized treatment for certain types of tumors.
Why is this medicine a big deal? According to the FDA:
Vitrakvi received an accelerated approval, which enables the FDA to approve drugs for serious conditions to fill an unmet medical need using clinical trial data that is thought to predict a clinical benefit to patients.
Vitravki is unlike most competing medicines, which target tumors based on where they originated in the body. Instead, Vitravki focuses on cancers that share a specific genetic feature.
The acquisition also brought Eli Lilly LOXO-292, a promising cancer treatment that could launch next year, and LOXO-305, another cancer treatment that is still in phase 2 testing. With this strong lineup, Eli Lilly hopes to keep its earnings afloat.
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Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie recently acquired Allergan for about $63 billion, a blockbuster deal that strengthened its portfolio of drugs and gave it more avenues to find new potentially high-revenue treatments. Case in point: AbbVie (NYSE: ABBV) stock is down by 13% year to date, while Eli Lilly (NYSE: LLY) shares are down by 7%. More than Humira AbbVie has become practically synonymous with Humira, and with good reason. | Case in point: AbbVie (NYSE: ABBV) stock is down by 13% year to date, while Eli Lilly (NYSE: LLY) shares are down by 7%. More than Humira AbbVie has become practically synonymous with Humira, and with good reason. Last year, for example, sales of Humira came in at $13.6 billion -- 63.5% of AbbVie's adjusted net revenues. | Case in point: AbbVie (NYSE: ABBV) stock is down by 13% year to date, while Eli Lilly (NYSE: LLY) shares are down by 7%. Last year, for example, sales of Humira came in at $13.6 billion -- 63.5% of AbbVie's adjusted net revenues. More than Humira AbbVie has become practically synonymous with Humira, and with good reason. | Last year, for example, sales of Humira came in at $13.6 billion -- 63.5% of AbbVie's adjusted net revenues. Case in point: AbbVie (NYSE: ABBV) stock is down by 13% year to date, while Eli Lilly (NYSE: LLY) shares are down by 7%. More than Humira AbbVie has become practically synonymous with Humira, and with good reason. |
24845.0 | 2019-10-25 00:00:00 UTC | Vanguard Health Care ETF -- Insider Buying Index Registering 14.7% | ABBV | https://www.nasdaq.com/articles/vanguard-health-care-etf-insider-buying-index-registering-14.7-2019-10-25 | nan | nan | A look at the weighted underlying holdings of the Vanguard Health Care ETF (Symbol: VHT) shows an impressive 14.7% of holdings on a weighted basis have experienced insider buying within the past six months.
AbbVie Inc (Symbol: ABBV), which makes up 2.79% of the Vanguard Health Care ETF (Symbol: VHT), has seen 7 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The ETF holds a total of $288,649,190 worth of ABBV, making it the #9 largest holding. The table below details the recent insider buying activity observed at ABBV:
ABBV — last trade: $76.80 — Recent Insider Buys:
And Heron Therapeutics Inc (Symbol: HRTX), the #158 largest holding among components of the Vanguard Health Care ETF (Symbol: VHT), shows 4 directors and officers as recently filing Form 4's indicating purchases. The ETF holds $3,678,315 worth of HRTX, which represents approximately 0.04% of the ETF's total assets at last check. The recent insider buying activity observed at HRTX is detailed in the table below:
HRTX — last trade: $19.29 — Recent Insider Buys:
10 ETFs With Stocks That Insiders Are Buying »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie Inc (Symbol: ABBV), which makes up 2.79% of the Vanguard Health Care ETF (Symbol: VHT), has seen 7 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The table below details the recent insider buying activity observed at ABBV: ABBV — last trade: $76.80 — Recent Insider Buys: And Heron Therapeutics Inc (Symbol: HRTX), the #158 largest holding among components of the Vanguard Health Care ETF (Symbol: VHT), shows 4 directors and officers as recently filing Form 4's indicating purchases. The ETF holds a total of $288,649,190 worth of ABBV, making it the #9 largest holding. | AbbVie Inc (Symbol: ABBV), which makes up 2.79% of the Vanguard Health Care ETF (Symbol: VHT), has seen 7 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The table below details the recent insider buying activity observed at ABBV: ABBV — last trade: $76.80 — Recent Insider Buys: And Heron Therapeutics Inc (Symbol: HRTX), the #158 largest holding among components of the Vanguard Health Care ETF (Symbol: VHT), shows 4 directors and officers as recently filing Form 4's indicating purchases. The ETF holds a total of $288,649,190 worth of ABBV, making it the #9 largest holding. | The table below details the recent insider buying activity observed at ABBV: ABBV — last trade: $76.80 — Recent Insider Buys: And Heron Therapeutics Inc (Symbol: HRTX), the #158 largest holding among components of the Vanguard Health Care ETF (Symbol: VHT), shows 4 directors and officers as recently filing Form 4's indicating purchases. AbbVie Inc (Symbol: ABBV), which makes up 2.79% of the Vanguard Health Care ETF (Symbol: VHT), has seen 7 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The ETF holds a total of $288,649,190 worth of ABBV, making it the #9 largest holding. | AbbVie Inc (Symbol: ABBV), which makes up 2.79% of the Vanguard Health Care ETF (Symbol: VHT), has seen 7 directors and officers purchase shares in the past six months, according to the recent Form 4 data. The ETF holds a total of $288,649,190 worth of ABBV, making it the #9 largest holding. The table below details the recent insider buying activity observed at ABBV: ABBV — last trade: $76.80 — Recent Insider Buys: And Heron Therapeutics Inc (Symbol: HRTX), the #158 largest holding among components of the Vanguard Health Care ETF (Symbol: VHT), shows 4 directors and officers as recently filing Form 4's indicating purchases. |
24846.0 | 2019-10-24 00:00:00 UTC | NOBL, BF.B, ABBV, AOS: ETF Inflow Alert | ABBV | https://www.nasdaq.com/articles/nobl-bf.b-abbv-aos%3A-etf-inflow-alert-2019-10-24 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the ProShares ProShares S&P 500 Dividend Aristocrats ETF (Symbol: NOBL) where we have detected an approximate $108.1 million dollar inflow -- that's a 1.9% increase week over week in outstanding units (from 78,300,000 to 79,800,000). Among the largest underlying components of NOBL, in trading today Brown-Forman Corp (Symbol: BF.B) is up about 0.6%, AbbVie Inc (Symbol: ABBV) is down about 1.3%, and Smith (A O) Corp (Symbol: AOS) is lower by about 0.6%. For a complete list of holdings, visit the NOBL Holdings page » The chart below shows the one year price performance of NOBL, versus its 200 day moving average:
Looking at the chart above, NOBL's low point in its 52 week range is $56.79 per share, with $72.43 as the 52 week high point — that compares with a last trade of $71.87. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs had notable inflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of NOBL, in trading today Brown-Forman Corp (Symbol: BF.B) is up about 0.6%, AbbVie Inc (Symbol: ABBV) is down about 1.3%, and Smith (A O) Corp (Symbol: AOS) is lower by about 0.6%. For a complete list of holdings, visit the NOBL Holdings page » The chart below shows the one year price performance of NOBL, versus its 200 day moving average: Looking at the chart above, NOBL's low point in its 52 week range is $56.79 per share, with $72.43 as the 52 week high point — that compares with a last trade of $71.87. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of NOBL, in trading today Brown-Forman Corp (Symbol: BF.B) is up about 0.6%, AbbVie Inc (Symbol: ABBV) is down about 1.3%, and Smith (A O) Corp (Symbol: AOS) is lower by about 0.6%. For a complete list of holdings, visit the NOBL Holdings page » The chart below shows the one year price performance of NOBL, versus its 200 day moving average: Looking at the chart above, NOBL's low point in its 52 week range is $56.79 per share, with $72.43 as the 52 week high point — that compares with a last trade of $71.87. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ». | Among the largest underlying components of NOBL, in trading today Brown-Forman Corp (Symbol: BF.B) is up about 0.6%, AbbVie Inc (Symbol: ABBV) is down about 1.3%, and Smith (A O) Corp (Symbol: AOS) is lower by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the ProShares ProShares S&P 500 Dividend Aristocrats ETF (Symbol: NOBL) where we have detected an approximate $108.1 million dollar inflow -- that's a 1.9% increase week over week in outstanding units (from 78,300,000 to 79,800,000). For a complete list of holdings, visit the NOBL Holdings page » The chart below shows the one year price performance of NOBL, versus its 200 day moving average: Looking at the chart above, NOBL's low point in its 52 week range is $56.79 per share, with $72.43 as the 52 week high point — that compares with a last trade of $71.87. | Among the largest underlying components of NOBL, in trading today Brown-Forman Corp (Symbol: BF.B) is up about 0.6%, AbbVie Inc (Symbol: ABBV) is down about 1.3%, and Smith (A O) Corp (Symbol: AOS) is lower by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the ProShares ProShares S&P 500 Dividend Aristocrats ETF (Symbol: NOBL) where we have detected an approximate $108.1 million dollar inflow -- that's a 1.9% increase week over week in outstanding units (from 78,300,000 to 79,800,000). For a complete list of holdings, visit the NOBL Holdings page » The chart below shows the one year price performance of NOBL, versus its 200 day moving average: Looking at the chart above, NOBL's low point in its 52 week range is $56.79 per share, with $72.43 as the 52 week high point — that compares with a last trade of $71.87. |
24847.0 | 2019-10-22 00:00:00 UTC | Goldman Sachs: 3 High-Yield Dividend Stocks With Growth on the Horizon | ABBV | https://www.nasdaq.com/articles/goldman-sachs%3A-3-high-yield-dividend-stocks-with-growth-on-the-horizon-2019-10-22 | nan | nan | Investors have voted with their wallets, and the verdict is in: they want income and growth. That shouldn’t be surprising, as income and growth are the keys to profitable investing, but market conditions have been volatile in the last 12 months. With share appreciation unreliable, investors have turned to dividends.
Dividends offer the steady income stream that investors want, while the top dividend stocks are available at a relative discount to market prices. According to Cole Hunter, a top strategist with Goldman Sachs, “The Dividend Growth basket … now trades at nearly the largest discount to the median S&P 500 stock since 2006.” He has assembled a list of stocks which he expects to both beat the S&P’s average dividend yield by a wide margin, and extend that margin through sustained dividend growth in the coming three years.
We’ve used TipRanks’ Stock Screener tool to further sort Hunter’s list of dividend champs, and find three with Buy ratings and great prospects for mid-term growth.
Citizens Financial (CFG)
The banking industry has had its ups and downs in recent years. It never really recovered the reputation lost in the 2008 Great Recession, even though most big banks had, by the end of 2009, paid the government back for money received under the Troubled Asset Relief Program. The long years of low-interest rates from 2009 through 2015, under the Federal Reserve’s quantitative easing policy, bit into lending profits but that pressure eased with the return of rate increases in December 2015. The rate cuts earlier this summer bode ill for the banking industry’s loan segments.
At the same time, however, earnings are up and expected to continue gaining. Citizens Financial, a long-standing name in the US banking industry, exemplifies the conflicting trends the industry faces, and the strength it has to weather the possible storms. With a $15 billion markets cap and more than 1,100 branches in 11 states, CFG ranks 13th in size among American banks. Its $6.13 billion in 2018 revenues led to a net income that year of $1.72 billion and the company’s quarterly earnings have been steady increasing through 2019.
Better yet, for income investors, CFG offers an annualized dividend yield of 4.05%, more than double the S&P average of 2.01%. The payment, $1.44 per share, is made in quarterly installments of 36 cents. According to Goldman Sachs’ Hunter, CFG’s yield is likely to reach 4.6% by the end of 2020, and through the combination of appreciation and dividends, investors will see an estimated return of 5.1% by 2021.
CFG’s firm position in its industry underlies the stock’s generally favorable reviews from Wall Street analysts. The stock received two Buy ratings last week, from RBC Capital and Evercore ISI.
Writing from RBC, 5-star analyst Gerard Cassidy reiterated his Buy on the stock, and set a $40 price target. As his bottom line, Cassidy said, “Earnings were essentially in line with expectations, reflecting strong fee income, which was led by mortgage banking, slightly lower credit costs and operating expenses. Though the company's fee revenue was strong in the quarter, net interest income was adversely impacted by a lower NIM… with its 10.3% CET1 ratio, [CFG] is well capitalized.” Cassidy’s target suggests a 12% upside to this stock. (To watch Cassidy's track record, click here)
Evercore’s John Pancari sees a similar path forward for CFG, saying, “CFG’s evolving business model is benefiting from momentum in fee businesses and a greater overall fee contribution – helping temper the impact of lower rates. CFG remains prudent in actively returning capital. Accordingly, we expect this positioning to continue to present upside to the stock’s discount valuation over time.”
Overall, CFG holds a Moderate Buy from the analyst consensus, with recent reviews including 2 buys, 1 hold, and 1 sell. Shares are trading at $35.58, so the average price target of $41 gives CFG an upside potential of 15%. (See Citizens Financial stock analysis on TipRanks)
AbbVie (ABBV)
This large-cap pharmaceutical giant has been pursuing a successful two-path growth strategy, making acquisitions for expansion and reaping profits from new medications (SKYRIZI) and established drugs (Humira). The AbbVie faced risk on the Humira front, however, as the patent on the popular biologic anti-inflammatory drug has expired and competition is growing. A risk management strategy is essential here, as Humira accounts for approximately 50% of the company’s drug division revenue.
Revenue remains strong. For fiscal 2018, AbbVie reported a $32.75 billion revenue stream, from which it derived a $6.38 billion income. Earnings per share have been increasing steadily since Q4 2018, and have beaten the forecasts in 1H19. The Q3 forecast is for $2.29 per share.
All of this gives AbbVie, like CFG, a solid foundation for profits, investor rewards, and growth. The company has been raising the dividend payment steadily for the last six years, showing confidence in itself and a commitment to returning income to investors. The current payment, of $1.07, annualizes to $4.28 and represents an impressive yield of 5.54%; in fact, AbbVie has the highest yield of the stocks in this article. According to Cole Hunter’s estimates, ABBV’s yield will increase to 6.1% next year, and by 2021 the return on cash invested should reach 6.6%.
Cowen analyst Steve Scala likes this stock, basing his assessment and Buy rating on a meeting with company management. He came away from that meeting with confidence in management’s plans for business and acquisition goals, in its new product portfolio, and its strategies to manage risk to the Humira profits. Scala’s $90 price target shows that confidence, as it indicates a 16% upside to the stock. (To watch Scala's track record, click here)
Writing from Piper Jaffray, 5-star analyst Christopher Raymond was impressed by the company’s new drugs, especially Skyrizi and Rinvoq. He says, “Just putting pen to paper, 5% RA market share in our model equates to annual US revenue of ~$1.3B -- a run rate… that far exceeds our FY20 estimate of $400M.”
All in all, Wall Street loves AbbVie. TipRanks tracking of 5 analyst ratings on the company shows a consensus Strong Buy, with 4 analysts recommending Buy and only one recommending Hold. The average price target is $86.33, representing a 10% upside from current levels. (See AbbVie stock analysis on TipRanks)
Valero Energy (VLO)
With our third stock, we move over to the energy industry. This cash-rich sector faced headwinds in the form of high overhead, heavy government regulation, and a lingering worry that Congress will shift farther left, pushing anti-fossil fuel policies, or that a Democratic White House victory next year will usher in an anti-oil stance. For now, however, mid- and downstream player Valero holds a stable position in the markets.
The company operates refineries, pipelines, and retail outlets for the manufacture and distribution of gasoline, diesel fuel, other petroleum distillates and fuels, and energy. Valero doesn’t extract the fossil fuels. Rather, it processes the raw products into usable forms, transports the refined products to market, and sells them. Owning the means to do this, along with the final sellable product, Valero maintains control over its business model.
Valero is one of the largest retail companies in the US, with 15 refining plants and over 6,800 outlets in the US, Canada, Caribbean, and UK. The company saw $117 billion in total revenues in the last fiscal year, which brought in $4.57 billion in net income. The large discrepancy underlines the high overhead common in the energy industry, while the high net income shows that energy remains profitable.
Returning profits to investors has long been a priority for Valero. The company currently shows a dividend yield of 3.86%, translating to a $3.60 annualized payout. The quarterly payment comes to 90 cents per share, and the company has been raising it steadily for the last five years. In 2014, the quarterly dividend was just 27.5 cents. Goldman’s Hunter sees investors benefiting from a higher 4.5% yield next year, while the overall return should reach 4.9% in 2021.
Writing from Wells Fargo, analyst Roger Read said back in August, “Valero is well-positioned to participate in increasing discounted domestic crude volumes along the Gulf Coast, especially as IMO 2020 is implemented. In 2018 and 2019, Valero's expected operating performance and commitment to shareholder returns via dividends and share repurchases appears to be favorably affecting its valuation multiples.” (To watch Read's track record, click here)
Since writing those lines, Read has reiterated his thesis on Valero, and boosted his price target. His new target, $108, implies an upside of 15% to the stock.
It’s not often that the analysts all agree on a stock, so when it does happen, take note. VLO’s Strong Buy consensus rating is based on a unanimous 7 Buys. The stock’s $99 average price target suggests a modest upside of 5% and a change from the current share price of $94. (See Valero Energy stock analysis on TipRanks)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (See Citizens Financial stock analysis on TipRanks) AbbVie (ABBV) This large-cap pharmaceutical giant has been pursuing a successful two-path growth strategy, making acquisitions for expansion and reaping profits from new medications (SKYRIZI) and established drugs (Humira). The AbbVie faced risk on the Humira front, however, as the patent on the popular biologic anti-inflammatory drug has expired and competition is growing. For fiscal 2018, AbbVie reported a $32.75 billion revenue stream, from which it derived a $6.38 billion income. | (See Citizens Financial stock analysis on TipRanks) AbbVie (ABBV) This large-cap pharmaceutical giant has been pursuing a successful two-path growth strategy, making acquisitions for expansion and reaping profits from new medications (SKYRIZI) and established drugs (Humira). The AbbVie faced risk on the Humira front, however, as the patent on the popular biologic anti-inflammatory drug has expired and competition is growing. For fiscal 2018, AbbVie reported a $32.75 billion revenue stream, from which it derived a $6.38 billion income. | (See Citizens Financial stock analysis on TipRanks) AbbVie (ABBV) This large-cap pharmaceutical giant has been pursuing a successful two-path growth strategy, making acquisitions for expansion and reaping profits from new medications (SKYRIZI) and established drugs (Humira). The AbbVie faced risk on the Humira front, however, as the patent on the popular biologic anti-inflammatory drug has expired and competition is growing. For fiscal 2018, AbbVie reported a $32.75 billion revenue stream, from which it derived a $6.38 billion income. | (See Citizens Financial stock analysis on TipRanks) AbbVie (ABBV) This large-cap pharmaceutical giant has been pursuing a successful two-path growth strategy, making acquisitions for expansion and reaping profits from new medications (SKYRIZI) and established drugs (Humira). The AbbVie faced risk on the Humira front, however, as the patent on the popular biologic anti-inflammatory drug has expired and competition is growing. For fiscal 2018, AbbVie reported a $32.75 billion revenue stream, from which it derived a $6.38 billion income. |
24848.0 | 2019-10-22 00:00:00 UTC | Which High-Yield Dividend Aristocrat Is the Best Buy? | ABBV | https://www.nasdaq.com/articles/which-high-yield-dividend-aristocrat-is-the-best-buy-2019-10-22 | nan | nan | Dividend Aristocrats are a select group of S&P 500 companies that have raised their dividends for a minimum of 25 consecutive years. What's particularly noteworthy about these income-generating equities is that Dividend Aristocrats, as a whole, have beaten the broader markets -- as well as the vast majority of sector-specific exchange-traded funds -- in terms of total returns on capital for the past five years.
Despite their market-beating performance, however, Dividend Aristocrats aren't known for their breathtaking yields. For instance, out of the 57 companies currently on this esteemed list, over 40% sport yields of less than 2%. In other words, Dividend Aristocrats generally aren't a great place to unearth top-notch passive income opportunities.
Image source: Getty Images.
There are three glaring exceptions to this general trend, however. The pharmaceutical titan AbbVie (NYSE: ABBV), the telecom giant AT&T (NYSE: T), and the oil and gas behemoth ExxonMobil (NYSE: XOM) all offer forward annual dividend yields greater than 5%. Which of these high-yield Dividend Aristocrats is the best buy right now? Let's dig deeper to find out.
How do these three high-yielders stack up?
When it comes to picking dividend stocks, there are three key criteria to consider:
Dividend yield.
The long-term sustainability of that yield.
The stock's current valuation in relation to the company's long-term outlook.
How do AbbVie, AT&T, and ExxonMobil stack up on these three critical factors? In terms of forward annual dividend yield, AbbVie comes in at 5.6%, which tops the yields of both AT&T (5.3%) and ExxonMobil (5.15%). AbbVie, then, offers the highest yield among all Dividend Aristocrats.
How about sustainability? The standard metric to evaluate the sustainability of a company's dividend is known as the payout ratio, expressed as dividends per share divided by earnings per share. In the simplest terms, the higher the ratio, the harder it will be for a company to maintain its dividend at current levels.
On this metric, ExxonMobil takes the cake with a trailing-12-month payout ratio of 80.2%. AT&T comes in second place at 86.4%. AbbVie, on the other hand, lags far behind in this comparison, with a rather worrisome payout ratio of 144.5%. AbbVie's dividend payments, in other words, have been far exceeding net income over the prior 12-month period.
The payout ratio, however, doesn't tell the full story here. AbbVie is set to merge with Botox maker Allergan, which is expected to provide a significant boost to its earnings per share over the next three consecutive years. AbbVie's top line and free cash flow are also in line to get a nice lift from a trio of high-value regulatory approvals -- for Orilissa, Rinvoq, and Skyrizi -- in the coming decade.
The point is that AbbVie is in no danger of losing its Dividend Aristocrat status. In fact, the drugmaker should have no trouble raising its dividend next year, despite its unsightly trailing payout ratio. So if anything, AbbVie, AT&T, and ExxonMobil should all be considered fairly safe income plays.
How about valuation? AbbVie is the hands-down winner on this metric. The drugmaker's shares are currently trading at a paltry eight times forward-looking earnings. By contrast, AT&T's shares come in at 10.6 times forward-looking earnings, and ExxonMobil's stock sports a sky-valuation at 17.45 times forward-looking earnings.
The winner?
While all three of these Dividend Aristocrats are arguably worth buying, AbbVie stands out as the clear winner in this comparison. The drugmaker has the richest payout and the most attractive valuation, and its dividend should be safe for the long haul, thanks to management's string of successful business development activities.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie is set to merge with Botox maker Allergan, which is expected to provide a significant boost to its earnings per share over the next three consecutive years. The pharmaceutical titan AbbVie (NYSE: ABBV), the telecom giant AT&T (NYSE: T), and the oil and gas behemoth ExxonMobil (NYSE: XOM) all offer forward annual dividend yields greater than 5%. How do AbbVie, AT&T, and ExxonMobil stack up on these three critical factors? | The pharmaceutical titan AbbVie (NYSE: ABBV), the telecom giant AT&T (NYSE: T), and the oil and gas behemoth ExxonMobil (NYSE: XOM) all offer forward annual dividend yields greater than 5%. In terms of forward annual dividend yield, AbbVie comes in at 5.6%, which tops the yields of both AT&T (5.3%) and ExxonMobil (5.15%). How do AbbVie, AT&T, and ExxonMobil stack up on these three critical factors? | In terms of forward annual dividend yield, AbbVie comes in at 5.6%, which tops the yields of both AT&T (5.3%) and ExxonMobil (5.15%). The pharmaceutical titan AbbVie (NYSE: ABBV), the telecom giant AT&T (NYSE: T), and the oil and gas behemoth ExxonMobil (NYSE: XOM) all offer forward annual dividend yields greater than 5%. How do AbbVie, AT&T, and ExxonMobil stack up on these three critical factors? | In terms of forward annual dividend yield, AbbVie comes in at 5.6%, which tops the yields of both AT&T (5.3%) and ExxonMobil (5.15%). AbbVie, then, offers the highest yield among all Dividend Aristocrats. The pharmaceutical titan AbbVie (NYSE: ABBV), the telecom giant AT&T (NYSE: T), and the oil and gas behemoth ExxonMobil (NYSE: XOM) all offer forward annual dividend yields greater than 5%. |
24849.0 | 2019-10-22 00:00:00 UTC | Is TG Therapeutics a Buy? | ABBV | https://www.nasdaq.com/articles/is-tg-therapeutics-a-buy-2019-10-22 | nan | nan | One of the current top-performing autoimmune disease biotech firms in the market, at least in terms of performance, is TG Therapeutics (NASDAQ: TGTX). Throughout the first half of 2019, TG Therapeutics was one of the most promising biotech stocks in the sector, with shares rising by as much as 224% between February and July. However, this all seemed to change in Q3 as the stock has quickly given back the majority of its previous gains, falling 42% since early July.
While it's normal in the world of biotech for stocks to rise and fall significantly over a short period of time, some investors are wondering whether the stock is still a good buy at its reduced price. Below we'll look at a few reasons why this company may or may not be a better buy now that its price has fallen significantly.
IMAGE SOURCE: GETTY IMAGES.
Hematology and autoimmune disease breakthroughs
TG Therapeutics is focused on developing drug candidates for relatively untreated blood cancers and autoimmune diseases. Currently, the company has two late-stage candidates, TG-1101 (also known as ublituximab, or just ubli) and TGR-1202 (known as umbralisib, or simply umbra). Both drug candidates have shown highly promising results thus far. Ubli is an antibody that inhibits a key antigen known as CD20 in blood cancer cells, while umbra works to suppress an enzyme known as PI3K, which plays a key role in the multiplication of cancer cells.
Additionally, both compounds are being used in a phase 3 clinical trial to see how effective they are in treating non-Hodgkin lymphoma as well as chronic lymphocytic leukemia. Cancer cells can evolve and become resistant to a particular treatment due to their rapid multiplication rate. That's why both ubli and umbra are being tested together in this trial, as using a multitude of cancer treatments simultaneously can be more effective in wiping out cancer cells than simply taking one treatment at a time.
Earlier in the year, TG Therapeutics reported strong results for umbra as a treatment for marginal zone lymphoma (MZL). Specifically, umbra received both an orphan drug designation as well as a breakthrough therapy designation from the FDA, a significant achievement for the biotech company.
In late September, TG Therapeutics announced results for its umbra/ubli drug combination. The results were once again positive, with efficacy data from 69 patients involved in the trial showing that the combination had an impressive 72.5% clinical benefit rate across all the various types of blood cell cancers that were present among patients.
Dr. Matthew Lunning, from the University of Nebraska, who had been studying umbra and ubli since 2014, had this to say:
From a safety standpoint, the combination was generally well-tolerated. Some notable findings included that colitis and hepatic toxicity were nearly absent in this population and overall, we observed relatively low rates of immune-mediated toxicities and opportunistic infections, in contrast to the experience with other PI3K delta class members. Taken together, I believe the toxicity, tolerability and efficacy profile make this combination a promising treatment option across B-cell lymphomas and a potential backbone for future triple and quad combinations.
Looking at the financials
While the long-term prospects for TG Therapeutics' drug candidates seem promising, it is worth taking time to pore through the financials, even though as it's a young biotech stock, these financial figures will change drastically in the upcoming years.
For small biotech companies with promising drug candidates, one of the top things to look out for is that the business has enough cash to cover its expenses for at least the next 12 to 18 months. TG Therapeutics has around $85 million in cash and equivalents according to its recent Q2 financials. In comparison, net losses for the quarter came in at $36.2 million.
While lower than the $44.1 million net loss seen in Q1, a 17.9% improvement over just three months, it's still a significant chunk of the company's cash reserves. At this rate, it's clear that TG Therapeutics will need to seek additional financing sometime in 2020.
Potential competition
Some investors may be able to overlook the fact that TG Therapeutics will need more financing in the future, but the big issue here is that TG Therapeutics is already competing in a crowded field. Pharmaceutical giants such as Gilead, Bristol-Myers, and AbbVie (NYSE: ABBV) are all competing in the blood cancer and hematology fields with drugs candidates that have seen comparable results to TG's umbra and ubli.
AbbVie in particular has been emphasizing its leukemia drug Venclexta, which has already received recent positive recommendations from major lymphoma institutions in North America. On the other hand, the overall size of the blood cancer market is quite large, with current estimates projecting it to reach $64.8 billion by 2023 (an 11% annual growth rate from the $38.5 billion in 2018). The sheer size of the blood cancer market could mean that even if TG Therapeutics' drug candidates get outclassed by rival therapies, it only needs to capture a small portion of the market share to become a financial success. This is especially true considering the relatively small size of TG Therapeutics compared to its competitors.
At the same time, the variable nature of patients and their responses to medication means not every patient will respond the same way to each drug. Sometimes cancer cells become resistant to one particular treatment, with patients having to switch to alternative therapies at that point. Given that, it's likely TG Therapeutics' drugs could find some measure of secondary success as an alternative, second-line therapy if they fail to outperform their competitors.
Does this make TG Therapeutics a buy?
All this makes TG Therapeutics an interesting case. At the moment, the handful of biotech analysts covering the stock on Wall Street all have buy ratings on the company. However, taking into consideration that TG Therapeutics is burning through cash and facing significant competition from other, well-known pharmaceutical giants, things don't seem as positive as one would image from reading only the clinical trial results.
While it's true that TG Therapeutics' drug therapies only need to capture a small portion of their intended markets for the company to be a financial success, such a reality is still quite far away, and much can happen in the meantime. If you're looking for a speculative biotech investment, TG Therapeutics could warrant a small position in a high-risk, high-reward portfolio. For the majority of investors, though, it's best to wait perhaps until the end of 2019 to see if prices fall more and whether further updates are released before considering the stock a potential buy.
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Mark Prvulovic has no position in any of the stocks mentioned. The Motley Fool recommends TG Therapeutics. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Pharmaceutical giants such as Gilead, Bristol-Myers, and AbbVie (NYSE: ABBV) are all competing in the blood cancer and hematology fields with drugs candidates that have seen comparable results to TG's umbra and ubli. AbbVie in particular has been emphasizing its leukemia drug Venclexta, which has already received recent positive recommendations from major lymphoma institutions in North America. However, taking into consideration that TG Therapeutics is burning through cash and facing significant competition from other, well-known pharmaceutical giants, things don't seem as positive as one would image from reading only the clinical trial results. | Pharmaceutical giants such as Gilead, Bristol-Myers, and AbbVie (NYSE: ABBV) are all competing in the blood cancer and hematology fields with drugs candidates that have seen comparable results to TG's umbra and ubli. AbbVie in particular has been emphasizing its leukemia drug Venclexta, which has already received recent positive recommendations from major lymphoma institutions in North America. Hematology and autoimmune disease breakthroughs TG Therapeutics is focused on developing drug candidates for relatively untreated blood cancers and autoimmune diseases. | Pharmaceutical giants such as Gilead, Bristol-Myers, and AbbVie (NYSE: ABBV) are all competing in the blood cancer and hematology fields with drugs candidates that have seen comparable results to TG's umbra and ubli. AbbVie in particular has been emphasizing its leukemia drug Venclexta, which has already received recent positive recommendations from major lymphoma institutions in North America. Looking at the financials While the long-term prospects for TG Therapeutics' drug candidates seem promising, it is worth taking time to pore through the financials, even though as it's a young biotech stock, these financial figures will change drastically in the upcoming years. | Pharmaceutical giants such as Gilead, Bristol-Myers, and AbbVie (NYSE: ABBV) are all competing in the blood cancer and hematology fields with drugs candidates that have seen comparable results to TG's umbra and ubli. AbbVie in particular has been emphasizing its leukemia drug Venclexta, which has already received recent positive recommendations from major lymphoma institutions in North America. That's why both ubli and umbra are being tested together in this trial, as using a multitude of cancer treatments simultaneously can be more effective in wiping out cancer cells than simply taking one treatment at a time. |
24850.0 | 2019-10-18 00:00:00 UTC | 3 Companies to Watch At Kidney Week 2019 | ABBV | https://www.nasdaq.com/articles/3-companies-to-watch-at-kidney-week-2019-2019-10-18 | nan | nan | While earnings season is under way, investors in biotech stocks must also stay abreast of the latest data emerging from major medical meetings. At these events, biotech and pharmaceutical companies vie for top billing to showcase the latest results on clinical trials and new drug candidates.
The American Society of Nephrology Annual Meeting, also known as Kidney Week, will take place from Nov. 5-10 in Washington, D.C. Three companies presenting data at the event -- Apellis (NASDAQ: APLS), Reata Pharmaceuticals (NASDAQ: RETA), and Retrophin (NASDAQ: RTRX) -- are particularly compelling as investments. Here's why.
Image Source: Getty Images.
Apellis takes on the complement system
Apellis will present data from eight patients in the complement 3 glomerulopathy (C3G) cohort of its ongoing phase two clinical trial with the drug candidate APL-2. In C3G, an overactive immune system degrades the protein C3, causing fragments to be trapped in the kidney. The resulting buildup leads to inflammation and organ damage. According to the company, 30% to 50% of patients diagnosed with C3G will have kidney failure within 10 years of diagnosis. Apellis' APL-2 seeks to stop the body from attacking the C3 protein, a key mediator of the immune system's complement pathway."
While this marks the first clinical data from this group of patients, APL-2 is also being evaluated in several rare hematology indications, as well as for geographic atrophy, an ophthalmic disease. Last month, Ra Pharmaceuticals (NASDAQ: RARX), another biotech company developing drugs targeting the complement pathway, announced an agreement to be acquired by Belgian specialty pharma UCB. This demonstrates that targeting the complement system is continuing to gain steam as a viable, and lucrative, pathway.
Reata aims to keep up the momentum
Reata may add to its hot streak during Kidney Week with presentations focusing on the company's lead pipeline candidate, bardoxolone methyl, and its impact on kidney events and cardiovascular safety. Additionally, data will be presented on the mechanism behind bardoxolone methyl and Reata's other drug candidates.
This past few weeks have been busy for Reata. The company reacquired global rights to some of its drug candidates from AbbVie (NYSE: ABBV) and presented positive clinical data in a study involving omaveloxolone to treat Friedreich's ataxia. Reata's stock skyrocketed 70% since those results were announced, and reports on its phase-three clinical trial with bardoxolone methyl for Alport syndrome are expected before the end of the year. While the Kidney Week presentations will show Reata to be a strong investment candidate, the most important major near-term catalyst is the pending phase-three results.
Retrophin will provide new data from its phase-two trial
Retrophin announced that it will present new quality-of-life data from its ongoing phase-two trial of Sparsenten for focal segmental glomerulosclerosis (FSGS). In phase one, the company was able to demonstrate a greater than twofold reduction in proteinuria for patients treated with Sparsenten. A pivotal phase-three trial that will serve as the basis for approval in the U.S. and Europe has commenced enrollment, with interim top-line data set to be reported in the first half of 2021.
Additionally, at Kidney Week, Retrophin will present preclinical findings evaluating Sparsenten for Alport syndrome. The data will show Sparsenten's ability to slow kidney disease, prevent hearing loss, and extend lifespan (keep in mind that so far this is in mice, not humans!). Alport syndrome, which affects nearly 60,000 in the U.S., leads to end-stage kidney failure. There are currently no approved treatments, and Reata's phase-three trial could make bardoxolone methyl the first. That said, Sparsenten works by a different mechanism, so both drugs could provide benefit to patients should they succeed.
Retrophin's management would like to see the stock price reverse course; currently trading in the mid-$11 range, it is down 50% from the start of the year. The Kidney Week presentations may help a bit. However, Retrophin's value will be driven by its three marketed products, and ultimately by the outcome in 2021 of Spasenten in FSGS. Investors who expect roaring success may want to buy in now, while those who are less convinced could prefer to wait and see.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The company reacquired global rights to some of its drug candidates from AbbVie (NYSE: ABBV) and presented positive clinical data in a study involving omaveloxolone to treat Friedreich's ataxia. Last month, Ra Pharmaceuticals (NASDAQ: RARX), another biotech company developing drugs targeting the complement pathway, announced an agreement to be acquired by Belgian specialty pharma UCB. Reata's stock skyrocketed 70% since those results were announced, and reports on its phase-three clinical trial with bardoxolone methyl for Alport syndrome are expected before the end of the year. | The company reacquired global rights to some of its drug candidates from AbbVie (NYSE: ABBV) and presented positive clinical data in a study involving omaveloxolone to treat Friedreich's ataxia. The American Society of Nephrology Annual Meeting, also known as Kidney Week, will take place from Nov. 5-10 in Washington, D.C. Three companies presenting data at the event -- Apellis (NASDAQ: APLS), Reata Pharmaceuticals (NASDAQ: RETA), and Retrophin (NASDAQ: RTRX) -- are particularly compelling as investments. Reata's stock skyrocketed 70% since those results were announced, and reports on its phase-three clinical trial with bardoxolone methyl for Alport syndrome are expected before the end of the year. | The company reacquired global rights to some of its drug candidates from AbbVie (NYSE: ABBV) and presented positive clinical data in a study involving omaveloxolone to treat Friedreich's ataxia. The American Society of Nephrology Annual Meeting, also known as Kidney Week, will take place from Nov. 5-10 in Washington, D.C. Three companies presenting data at the event -- Apellis (NASDAQ: APLS), Reata Pharmaceuticals (NASDAQ: RETA), and Retrophin (NASDAQ: RTRX) -- are particularly compelling as investments. Reata aims to keep up the momentum Reata may add to its hot streak during Kidney Week with presentations focusing on the company's lead pipeline candidate, bardoxolone methyl, and its impact on kidney events and cardiovascular safety. | The company reacquired global rights to some of its drug candidates from AbbVie (NYSE: ABBV) and presented positive clinical data in a study involving omaveloxolone to treat Friedreich's ataxia. The American Society of Nephrology Annual Meeting, also known as Kidney Week, will take place from Nov. 5-10 in Washington, D.C. Three companies presenting data at the event -- Apellis (NASDAQ: APLS), Reata Pharmaceuticals (NASDAQ: RETA), and Retrophin (NASDAQ: RTRX) -- are particularly compelling as investments. Apellis takes on the complement system Apellis will present data from eight patients in the complement 3 glomerulopathy (C3G) cohort of its ongoing phase two clinical trial with the drug candidate APL-2. |
24851.0 | 2019-10-16 00:00:00 UTC | VTI, BRK.B, NEE, ABBV: Large Inflows Detected at ETF | ABBV | https://www.nasdaq.com/articles/vti-brk.b-nee-abbv%3A-large-inflows-detected-at-etf-2019-10-16 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Vanguard Total Stock Market ETF (Symbol: VTI) where we have detected an approximate $2.9 billion dollar inflow -- that's a 2.4% increase week over week in outstanding units (from 791,002,930 to 809,865,889). Among the largest underlying components of VTI, in trading today Berkshire Hathaway Inc New (Symbol: BRK.B) is up about 0.2%, NextEra Energy Inc (Symbol: NEE) is up about 0.2%, and AbbVie Inc (Symbol: ABBV) is higher by about 0.1%. For a complete list of holdings, visit the VTI Holdings page » The chart below shows the one year price performance of VTI, versus its 200 day moving average:
Looking at the chart above, VTI's low point in its 52 week range is $119.35 per share, with $154.51 as the 52 week high point — that compares with a last trade of $151.78. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs had notable inflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of VTI, in trading today Berkshire Hathaway Inc New (Symbol: BRK.B) is up about 0.2%, NextEra Energy Inc (Symbol: NEE) is up about 0.2%, and AbbVie Inc (Symbol: ABBV) is higher by about 0.1%. For a complete list of holdings, visit the VTI Holdings page » The chart below shows the one year price performance of VTI, versus its 200 day moving average: Looking at the chart above, VTI's low point in its 52 week range is $119.35 per share, with $154.51 as the 52 week high point — that compares with a last trade of $151.78. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of VTI, in trading today Berkshire Hathaway Inc New (Symbol: BRK.B) is up about 0.2%, NextEra Energy Inc (Symbol: NEE) is up about 0.2%, and AbbVie Inc (Symbol: ABBV) is higher by about 0.1%. For a complete list of holdings, visit the VTI Holdings page » The chart below shows the one year price performance of VTI, versus its 200 day moving average: Looking at the chart above, VTI's low point in its 52 week range is $119.35 per share, with $154.51 as the 52 week high point — that compares with a last trade of $151.78. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ». | Among the largest underlying components of VTI, in trading today Berkshire Hathaway Inc New (Symbol: BRK.B) is up about 0.2%, NextEra Energy Inc (Symbol: NEE) is up about 0.2%, and AbbVie Inc (Symbol: ABBV) is higher by about 0.1%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Vanguard Total Stock Market ETF (Symbol: VTI) where we have detected an approximate $2.9 billion dollar inflow -- that's a 2.4% increase week over week in outstanding units (from 791,002,930 to 809,865,889). For a complete list of holdings, visit the VTI Holdings page » The chart below shows the one year price performance of VTI, versus its 200 day moving average: Looking at the chart above, VTI's low point in its 52 week range is $119.35 per share, with $154.51 as the 52 week high point — that compares with a last trade of $151.78. | Among the largest underlying components of VTI, in trading today Berkshire Hathaway Inc New (Symbol: BRK.B) is up about 0.2%, NextEra Energy Inc (Symbol: NEE) is up about 0.2%, and AbbVie Inc (Symbol: ABBV) is higher by about 0.1%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Vanguard Total Stock Market ETF (Symbol: VTI) where we have detected an approximate $2.9 billion dollar inflow -- that's a 2.4% increase week over week in outstanding units (from 791,002,930 to 809,865,889). For a complete list of holdings, visit the VTI Holdings page » The chart below shows the one year price performance of VTI, versus its 200 day moving average: Looking at the chart above, VTI's low point in its 52 week range is $119.35 per share, with $154.51 as the 52 week high point — that compares with a last trade of $151.78. |
24852.0 | 2019-10-16 00:00:00 UTC | Should Investors Buy AbbVie Right Now for Its Dividend? | ABBV | https://www.nasdaq.com/articles/should-investors-buy-abbvie-right-now-for-its-dividend-2019-10-16 | nan | nan | Long-term dividend investors in the pharmaceutical sector have had quite a few high-quality stocks to invest in. One of these, however, seems to have fallen a little out of favor recently. Pharmaceutical giant AbbVie (NYSE: ABBV) has seen its shares fall significantly following news that it intended to acquire Botox developer Allergan (NYSE: AGN) in a massive $63 billion deal.
Even before this announcement was made, shares of AbbVie had fallen by 40% over the past 16 months since hitting a record high. While it's understandable that AbbVie, now that its Humira patent is expiring, will need to look elsewhere and plan for the future, investors are worried that the company might be overpaying and saddling itself with too much debt too quickly.
Although AbbVie's stock price has taken a tumble, there's a strong case to be made that its recent discount makes it a compelling investment opportunity. Here are a few reasons this might be true.
IMAGE SOURCE: GETTY IMAGES.
Diving deeper into the Allergan acquisition
Considering the sheer size of the deal, it’s worth taking some time to see exactly how the Allergan acquisition will change AbbVie's drug pipeline. According to an official investor presentation regarding the planned merger, despite eroding revenues from Humira, overall cash flow will still remain above analyst expectations.
Overall revenue growth is also expected to surge following the deal, with estimates coming in between 7% and 10% growth over the next few years. In comparison, the average growth rate for the top pharmaceutical companies by revenue is just 3.3%. While the prospectus doesn't provide more specifics about where this impressive growth rate will come from, Allergan's pipeline has a number of highly promising candidates that likely will end up as successes.
This includes its depression treatment Vraylar as well as a new pipeline of drug candidates intended to treat gastroparesis and nonalcoholic steatohepatitis (NASH). Besides these pipeline candidates, Allergan's Botox and implant products are also expected to remain solid revenue drivers for AbbVie once the merger comes together.
All this is a big deal for AbbVie, since its historical cash cow, Humira, is expected to see its sales erode over the next few years. Currently, Humira accounts for 60% of AbbVie's sales, but following the merger, Humira would account for only 40% of the company's revenues.
Other considerations
While the consensus on Wall Street seems to be that Allergan brings plenty to the table in terms of stable revenue and drug candidates, the fact that AbbVie will end up paying more than $60 billion for the deal is what's worrying some investors. AbbVie currently has approximately $31.6 billion in long-term debt.
For this reason, it's reassuring to hear that AbbVie's management tackled this specific topic in its postacquisition conference call. The company's chief executive promised that cutting back on the debt would be one of its first priorities after the Allergan merger goes through.
"We have committed to reducing debt by $15 billion to $18 billion by the end of '21 with further deleveraging through 2023," said CEO Rick Gonzalez. AbbVie's chief executive also made sure to promise investors that the company would continue to grow its already strong dividend. "The transaction also provides cash flow to support a strong and growing dividend...we're absolutely committed to a growing dividend, and nothing has changed."
However, investors also have to take into consideration that the previously mentioned figures are still just internal projections. While the company's management is just as qualified as any other third-party analyst to make these estimates, they do have a vested interest in making sure the merger goes ahead as planned. Even if investors take these estimates with a pinch of salt, however, there's little reason to doubt that AbbVie's combined drug pipeline would lead to significant growth.
Other drivers of revenue growth include immunology drugs such as Rinvoq and Skyrizi, both of which could rival Humira in terms of effectiveness. Rinvoq, in particular, has seen highly promising clinical study results that showed it outperformed Humira in treating rheumatoid arthritis in all of the study's measures of efficiency. Both drugs received approval earlier this year, and AbbVie's management expects them to generate around $6.5 billion and $5 billion, respectively, in peak annual revenue.
An attractive dividend
Assuming that AbbVie is able to quickly reduce its debt load, its dividend seems much more appealing. The company has maintained a strong dividend over the past few years, with its current yield of 5.8% trouncing the S&P 500's dividend yield of 1.9%.
In comparison to the same time last year, AbbVie's dividend has grown by 19.2%, with the company increasing its dividend five times over the past five years. The company shows no signs that it's planning to stop this pattern, which means that dividend investors have a lot to look forward to from AbbVie in the future, especially if any of its new drugs become as successful as anticipated.
Final thoughts
While investors might have balked at just how much debt AbbVie is taking on to make this Allergan deal a reality, there isn't too much to be worried about. Even previously bearish analysts, such as CitiGroup's Andrew Baum, have changed their ratings for AbbVie from a sell to a buy after considering AbbVie's postmerger financial projections for the upcoming years.
AbbVie's share price seems to be greatly discounted at present, with its promising new drugs getting overshadowed amid these debt concerns. This is a shame since the future looks bright for the pharmaceutical giant in terms of both revenue growth and an increasing dividend.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Other considerations While the consensus on Wall Street seems to be that Allergan brings plenty to the table in terms of stable revenue and drug candidates, the fact that AbbVie will end up paying more than $60 billion for the deal is what's worrying some investors. The company shows no signs that it's planning to stop this pattern, which means that dividend investors have a lot to look forward to from AbbVie in the future, especially if any of its new drugs become as successful as anticipated. Pharmaceutical giant AbbVie (NYSE: ABBV) has seen its shares fall significantly following news that it intended to acquire Botox developer Allergan (NYSE: AGN) in a massive $63 billion deal. | Diving deeper into the Allergan acquisition Considering the sheer size of the deal, it’s worth taking some time to see exactly how the Allergan acquisition will change AbbVie's drug pipeline. AbbVie's chief executive also made sure to promise investors that the company would continue to grow its already strong dividend. Pharmaceutical giant AbbVie (NYSE: ABBV) has seen its shares fall significantly following news that it intended to acquire Botox developer Allergan (NYSE: AGN) in a massive $63 billion deal. | Other considerations While the consensus on Wall Street seems to be that Allergan brings plenty to the table in terms of stable revenue and drug candidates, the fact that AbbVie will end up paying more than $60 billion for the deal is what's worrying some investors. AbbVie's chief executive also made sure to promise investors that the company would continue to grow its already strong dividend. In comparison to the same time last year, AbbVie's dividend has grown by 19.2%, with the company increasing its dividend five times over the past five years. | Besides these pipeline candidates, Allergan's Botox and implant products are also expected to remain solid revenue drivers for AbbVie once the merger comes together. Pharmaceutical giant AbbVie (NYSE: ABBV) has seen its shares fall significantly following news that it intended to acquire Botox developer Allergan (NYSE: AGN) in a massive $63 billion deal. Even before this announcement was made, shares of AbbVie had fallen by 40% over the past 16 months since hitting a record high. |
24853.0 | 2019-10-16 00:00:00 UTC | Reata Pharmaceuticals Repositions Itself for Success | ABBV | https://www.nasdaq.com/articles/reata-pharmaceuticals-repositions-itself-for-success-2019-10-16 | nan | nan | It's been a busy October for Reata Pharmaceuticals (NASDAQ: RETA), which kicked things off Oct. 10 with the announcement that it would end its nine-year partnership with AbbVie (NYSE: ABBV). This move allows Reata to reclaim the exclusive rights to two drugs in late-stage clinical trials, as well as next-generation drugs that use the same mechanism. Days later, Reata surprised much of Wall Street with positive results from a pivotal clinical trial for omaveloxolone (omav) as a treatment for Friedreich's ataxia, a neuromuscular disease with no approved treatment options. The stock surged 60% following the announcement, adding roughly $1.5 billion to the company's valuation.
While the euphoria of the positive clinical results from omav sets in, investors new to the company must evaluate where Reata can go from here and whether the valuation remains compelling.
Image Source: Getty Images.
Reata regains exclusive rights to drug candidates from AbbVie
Reata is paying AbbVie $330 million to reacquire the rights to bardoxolone methyl (bard), omav, and all next-generation Nrf2 activators. In 2010, Reata licensed to AbbVie the ex-U.S. rights for bard, as well as the worldwide rights to omav and the Nrf2 activators. This month's move returns all worldwide rights to Reata, except in certain Asian countries where Kyowa Kirin Ltd. has development and commercialization rights for bard.
Reata will pay AbbVie $75 million this year, followed by payments of $150 million in June 2020 and $105 million in November 2021. Once all this is paid, Reata will not owe any future milestones or royalties on bard; management has agreed to pay a low-single-digit royalty to AbbVie on omav and certain next-generation Nrf2 activators.
Positive clinical trial results for omav
Reata hailed the positive results of a pivotal clinical trial for omav in Friedreich's ataxia, a debilitating disease usually diagnosed in children that causes patients to become wheelchair-bound and ultimately shortens their lifespans. Patients receiving omav demonstrated a statistically significant improvement in neurological function after 48 weeks of treatment compared with those receiving placebo, setting the stage for the company to file for regulatory approval. Reata estimates that there are 22,000 people worldwide with Friedreich's ataxia, including 5,000 in the United States. Currently, no approved treatments exist.
Renegotiating debt financing
In June 2018, Reata borrowed $80 million from Oxford Finance and Silicon Valley Bank, a subsidiary of SVB Financial (NASDAQ: SIVB). That agreement calls for a second tranche of $45 million to be available to the company upon the success of either the pivotal trial with bard in Alport syndrome or the omav clinical trial in Friederich's ataxia. Management has renegotiated with both lenders to increase the next round to $75 million while reducing several fees. Now that the positive results are known, Reata can use this capital to pay AbbVie.
Can Reata afford to go it alone?
As noted above, the renegotiated term loan provides access to $75 million, which can cover the payment to AbbVie. In the second quarter, Reata reported more than $240 million in cash on the balance sheet, and in less than a month, third-quarter results will provide an updated financial picture.
Reata has reclaimed the driver's seat for all of these drugs, meaning that next year it may be filing for approval for both omav and bard. Submitting a drug for approval and preparing for commercial launch are expensive undertakings, but following the success of omav, Reata should be in a position of strength for raising capital soon. As for bard, the pivotal trial tracked by the renegotiated loan should report results before the end of the year. If they're negative, this may dampen investor enthusiasm and Reata's valuation. If they're positive, Reata can more easily raise more money if necessary.
The AbbVie license agreement hints that Reata will be raising additional large sums of capital, noting that if more than $200 million is raised, Reata will pay AbbVie $25 million, to be deducted from the final milestone due in 2021. This gives us a hint of the amount of capital necessary to advance these compounds to the market.
What next?
Results should be out by year's end on the pivotal phase 2/3 bard trial, which deals with Alport syndrome. This progressive condition, affecting as many as 60,000 in the U.S., results in end-stage kidney disease and currently has no treatment. Investors who have been focused on the outcome of this trial (bard has been Reata's lead program) may find comfort in the fact that bard and omav work through a similar mechanism to target inflammation.
Reata isn't slowing down in 2020. The company will forge ahead with regulatory filings for approval of omav in Friedreich's ataxia while simultaneously preparing for a commercial launch. And if the results of the bard trial are positive, Reata may end up doing double duty. Filing a New Drug Application for the first time is quite an undertaking for any biotech company, and doing two at once is practically unheard of.
For investors, the quick money has been made for now. The buyback agreement with AbbVie prevents Reata from licensing these drugs in the first 18 months following the deal, so don't be on the lookout for a quick flip. Most likely, Reata will raise additional equity. There may be pressure on the stock until that happens. The final near-term risk is the outcome of the bard trial. However, for long-term holders, Reata looks like a company that could have one or two blockbusters heading to the market at the end of next year or by early 2021.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | It's been a busy October for Reata Pharmaceuticals (NASDAQ: RETA), which kicked things off Oct. 10 with the announcement that it would end its nine-year partnership with AbbVie (NYSE: ABBV). Reata regains exclusive rights to drug candidates from AbbVie Reata is paying AbbVie $330 million to reacquire the rights to bardoxolone methyl (bard), omav, and all next-generation Nrf2 activators. In 2010, Reata licensed to AbbVie the ex-U.S. rights for bard, as well as the worldwide rights to omav and the Nrf2 activators. | Reata regains exclusive rights to drug candidates from AbbVie Reata is paying AbbVie $330 million to reacquire the rights to bardoxolone methyl (bard), omav, and all next-generation Nrf2 activators. It's been a busy October for Reata Pharmaceuticals (NASDAQ: RETA), which kicked things off Oct. 10 with the announcement that it would end its nine-year partnership with AbbVie (NYSE: ABBV). In 2010, Reata licensed to AbbVie the ex-U.S. rights for bard, as well as the worldwide rights to omav and the Nrf2 activators. | Reata regains exclusive rights to drug candidates from AbbVie Reata is paying AbbVie $330 million to reacquire the rights to bardoxolone methyl (bard), omav, and all next-generation Nrf2 activators. The AbbVie license agreement hints that Reata will be raising additional large sums of capital, noting that if more than $200 million is raised, Reata will pay AbbVie $25 million, to be deducted from the final milestone due in 2021. It's been a busy October for Reata Pharmaceuticals (NASDAQ: RETA), which kicked things off Oct. 10 with the announcement that it would end its nine-year partnership with AbbVie (NYSE: ABBV). | Now that the positive results are known, Reata can use this capital to pay AbbVie. The AbbVie license agreement hints that Reata will be raising additional large sums of capital, noting that if more than $200 million is raised, Reata will pay AbbVie $25 million, to be deducted from the final milestone due in 2021. It's been a busy October for Reata Pharmaceuticals (NASDAQ: RETA), which kicked things off Oct. 10 with the announcement that it would end its nine-year partnership with AbbVie (NYSE: ABBV). |
24854.0 | 2019-10-15 00:00:00 UTC | Here's Why Reata Pharmaceuticals Skyrocketed Higher Today | ABBV | https://www.nasdaq.com/articles/heres-why-reata-pharmaceuticals-skyrocketed-higher-today-2019-10-15 | nan | nan | What happened
Shares of Reata Pharmaceuticals (NASDAQ: RETA) are up 59% at 12:26 p.m. EDT, after the company released positive data for the midstage Moxie study of its drug candidate, omaveloxolone, in patients with a neuromuscular disease called Friedreich's ataxia.
As biotech investors have seen time and time again, positive clinical trial data can lead to monstrous one-day gains, especially if that data comes in a disease like Friedreich's ataxia where multiple failures over the years have led to low expectations.
Image source: Getty Images.
So what
Using the modified Friedreich's Ataxia Rating Scale (mFARS), patients treated with omaveloxolone had an average improvement of 1.55 points -- improvement indicates a lower score on the scale -- compared to an average worsening of 0.85 points for patients who received placebo. The 2.4-point difference was statistically significant.
The clinical trial was set up to exclude patients with pes cavus, a musculoskeletal foot deformity that can keep patients from performing some of the tests in the mFARS exam. But even when patients with pes cavus were included, the difference in scores was 1.93 points, which was also statistically significant.
Importantly, the effect increased over time with 48 weeks -- the end of the study -- showing the largest mFARS improvement for omaveloxolone compared to placebo. Since this will be a long-term treatment, and not a cure, doctors will want to see that kind of robust, long-lasting effect.
Now what
In a well-timed move last week, Reata Pharmaceuticals agreed to pay $330 million to reacquire the rights to omaveloxolone and bardoxolone, a drug in the same Nrf2 activator drug class, from its partner AbbVie (NYSE: ABBV). Reata will also owe AbbVie single-digit, tiered royalties on sales of omaveloxolone and predefined next-generation Nrf2 activators, but bardoxolone will be royalty-free.
Reata will need to meet with the Food and Drug Administration and other regulators to discuss whether the data from Moxie is enough to gain approval. Given the unmet need for patients with Friedreich's ataxia, an accelerated approval with Reata performing a confirmatory post-marketing study seems likely -- but this is the FDA, and anything can happen.
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Brian Orelli and The Motley Fool have no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Now what In a well-timed move last week, Reata Pharmaceuticals agreed to pay $330 million to reacquire the rights to omaveloxolone and bardoxolone, a drug in the same Nrf2 activator drug class, from its partner AbbVie (NYSE: ABBV). Reata will also owe AbbVie single-digit, tiered royalties on sales of omaveloxolone and predefined next-generation Nrf2 activators, but bardoxolone will be royalty-free. What happened Shares of Reata Pharmaceuticals (NASDAQ: RETA) are up 59% at 12:26 p.m. EDT, after the company released positive data for the midstage Moxie study of its drug candidate, omaveloxolone, in patients with a neuromuscular disease called Friedreich's ataxia. | Now what In a well-timed move last week, Reata Pharmaceuticals agreed to pay $330 million to reacquire the rights to omaveloxolone and bardoxolone, a drug in the same Nrf2 activator drug class, from its partner AbbVie (NYSE: ABBV). Reata will also owe AbbVie single-digit, tiered royalties on sales of omaveloxolone and predefined next-generation Nrf2 activators, but bardoxolone will be royalty-free. What happened Shares of Reata Pharmaceuticals (NASDAQ: RETA) are up 59% at 12:26 p.m. EDT, after the company released positive data for the midstage Moxie study of its drug candidate, omaveloxolone, in patients with a neuromuscular disease called Friedreich's ataxia. | Now what In a well-timed move last week, Reata Pharmaceuticals agreed to pay $330 million to reacquire the rights to omaveloxolone and bardoxolone, a drug in the same Nrf2 activator drug class, from its partner AbbVie (NYSE: ABBV). Reata will also owe AbbVie single-digit, tiered royalties on sales of omaveloxolone and predefined next-generation Nrf2 activators, but bardoxolone will be royalty-free. What happened Shares of Reata Pharmaceuticals (NASDAQ: RETA) are up 59% at 12:26 p.m. EDT, after the company released positive data for the midstage Moxie study of its drug candidate, omaveloxolone, in patients with a neuromuscular disease called Friedreich's ataxia. | Now what In a well-timed move last week, Reata Pharmaceuticals agreed to pay $330 million to reacquire the rights to omaveloxolone and bardoxolone, a drug in the same Nrf2 activator drug class, from its partner AbbVie (NYSE: ABBV). Reata will also owe AbbVie single-digit, tiered royalties on sales of omaveloxolone and predefined next-generation Nrf2 activators, but bardoxolone will be royalty-free. But even when patients with pes cavus were included, the difference in scores was 1.93 points, which was also statistically significant. |
24855.0 | 2019-10-14 00:00:00 UTC | Health Care Sector Update for 10/14/2019: CTST,APYX,FLXN,AGN,ABBV | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-10-14-2019%3A-ctstapyxflxnagnabbv-2019-10-14 | nan | nan | Top Health Care Stocks
JNJ -0.41%
PFE +0.43%
ABT +0.23%
MRK +0.43%
AMGN +1.26%
Health care stocks were slightly lower in late trade, with the NYSE Health Care Index and shares of health care companies in the S&P 500 as a group both slipping fractionally. The Nasdaq Biotechnology index was posting a nearly 0.3% advance.
Among health care stocks moving on news:
(+) CannTrust Holdings (CTST) surged 15.6% on Monday after the Canadian medical and recreational marijuana producer said it would destroy over $49 million in inventory and more than $9 million in biological assets to regain compliance after Health Canada Sept. 17 suspended its licenses to produce and sell cannabis when it was found to be allegedly cultivating pot in unlicensed rooms. The company said the move will free up capacity for remediation measures and to store material that has been grown and processed since receiving its Health Canada licenses in April.
In other sector news:
(+) Flexion Therapeutics (FLXN) climbed over 3% after the biopharmaceuticals company Monday said the US Food and Drug Administration was postponing a decision while the agency works to complete its review of the company's supplemental new drug application for its Zilretta intra-articular injection to manage osteoarthritis knee pain. The company wants to revise the product label based on phase IIIb clinical data that evaluated repeat administration of Zilretta in patients with knee pain.
(+) Allergan (AGN) was narrowly lower shortly before Monday's closing bell. The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share.
(-) Apyx Medical (APYX) was falling nearly 1%, giving back a small, mid-morning gain. The medical device company said it has begun enrolling patients in a trial evaluating the safety and efficacy of its Renuvion technology to reduce skin laxity in the neck and submental region. Apyx is expected to include 52 subjects, with a primary endpoint of improved appearance of lax tissue after six months.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. The company said the move will free up capacity for remediation measures and to store material that has been grown and processed since receiving its Health Canada licenses in April. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were slightly lower in late trade, with the NYSE Health Care Index and shares of health care companies in the S&P 500 as a group both slipping fractionally. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were slightly lower in late trade, with the NYSE Health Care Index and shares of health care companies in the S&P 500 as a group both slipping fractionally. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were slightly lower in late trade, with the NYSE Health Care Index and shares of health care companies in the S&P 500 as a group both slipping fractionally. |
24856.0 | 2019-10-14 00:00:00 UTC | Health Care Sector Update for 10/14/2019: APYX,FLXN,AGN,ABBV | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-10-14-2019%3A-apyxflxnagnabbv-2019-10-14 | nan | nan | Top Health Care Stocks
JNJ -0.29%
PFE +0.48%
ABT -0.04%
MRK +0.50%
AMGN +1.68%
Health care stocks were posting small gains this afternoon, with the NYSE Health Care Index slipping less than 0.1% while the shares of health care companies in the S&P 500 were up fractionally as a group. The Nasdaq Biotechnology index was posting an 0.8% advance.
Among health care stocks moving on news:
(+) Apyx Medical (APYX) was falling about 1%, giving back a small, mid-morning gain. The medical device company said it has begun enrolling patients in a trial evaluating the safety and efficacy of its Renuvion technology to reduce skin laxity in the neck and submental region. Apyx is expected to include 52 subjects, with a primary endpoint of improved appearance of lax tissue after six months.
In other sector news:
(+) Flexion Therapeutics (FLXN) climbed over 5% after the biopharmaceuticals company Monday said the US Food and Drug Administration was postponing a decision while the agency works to complete its review of the company's supplemental new drug application for its Zilretta intra-articular injection to manage osteoarthritis knee pain. The company wants to revise the product label based on phase IIIb clinical data that evaluated repeat administration of Zilretta in patients with knee pain.
(+) Allergan (AGN) was narrowly higher this afternoon, reversing a mid-morning decline. The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. The medical device company said it has begun enrolling patients in a trial evaluating the safety and efficacy of its Renuvion technology to reduce skin laxity in the neck and submental region. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were posting small gains this afternoon, with the NYSE Health Care Index slipping less than 0.1% while the shares of health care companies in the S&P 500 were up fractionally as a group. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were posting small gains this afternoon, with the NYSE Health Care Index slipping less than 0.1% while the shares of health care companies in the S&P 500 were up fractionally as a group. | The Irish drugmaker said its shareholders have voted to approve its proposed $63 billion acquisition by American rival AbbVie (ABBV). Under terms of the proposed transaction announced in June, investors will 0.866 of an AbbVie shares and $120.30 in cash for each Allergan share, valuing the target company at $188.24 per share. Health care stocks were posting small gains this afternoon, with the NYSE Health Care Index slipping less than 0.1% while the shares of health care companies in the S&P 500 were up fractionally as a group. |
24857.0 | 2019-10-13 00:00:00 UTC | 3 Top Healthcare Dividend Stocks That Are Great Picks for Retirees | ABBV | https://www.nasdaq.com/articles/3-top-healthcare-dividend-stocks-that-are-great-picks-for-retirees-2019-10-13 | nan | nan | If you're near retirement or already retired, dividend stocks undoubtedly rank high on your list of investing alternatives. The healthcare sector is a great place to look for dividend stocks with aging demographics trends driving long-term growth.
But which healthcare dividend stocks provide high yields plus reasonable growth prospects? Here's why AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Pfizer (NYSE: PFE) stand out.
Image source: Getty Images.
1. AbbVie
AbbVie's dividend yield of over 5.8% ranks as one of the highest among healthcare stocks. Even better, the drugmaker has increased its dividend by 168% since it was spun off from Abbott Labs in 2013.
The primary concern that some investors have with AbbVie is that the company is highly dependent on sales of Humira, which now faces biosimilar competition in Europe and will do so in the bigger U.S. market beginning in 2023. But AbbVie has been planning for this scenario for years and should be in a position to keep the dividends flowing while still delivering moderate growth.
Current blockbuster cancer drugs Imbruvica and Venclexta, both of which continue to generate strong growth, are a key part of AbbVie's strategy. Newly approved Rinvoq and Skyrizi are also critical to the company's growth prospects. Market researcher EvaluatePharma ranked the immunology drugs No. 2 and No. 3, respectively, on its list of top new drugs approved in 2019.
There's now another twist to AbbVie's approach to reducing its dependence on Humira: the pending acquisition of Allergan. Although some investors have been skeptical about the deal, at least one Wall Street analyst, Citigroup's Andrew Baum, is optimistic, stating that "AbbVie will extract significant shareholder value from Allergan's franchises."
2. Gilead Sciences
Gilead Sciences offers an attractive dividend that currently yields north of 4%. The big biotech initiated its dividend program in 2015 and has increased the payout by nearly 47% since then.
The past few years have been challenging for Gilead as revenue and earnings sank because of plunging sales for its hepatitis C drugs. But the company appears to have turned the corner now, with hep-C revenue stabilizing in recent quarters. This has changed the focus to Gilead's HIV franchise.
Biktarvy appears destined to become the best-selling HIV drug in history. Gilead also thinks that the potential for Descovy as preexposure prophylaxis (PrEP) therapy for HIV is significant. The biotech's pipeline includes a long-acting HIV drug in early stage testing, GS-6207, that could be another huge success story.
Perhaps the most intriguing opportunities for Gilead right now, though, are the company's efforts beyond the antiviral arena. The acquisition of Kite Pharma in 2017 has made Gilead a leader in cancer cell therapy. Gilead has high hopes for immunology drug filgotinib, which it plans to file for approval in the U.S. this year. The biotech is also evaluating a couple of drugs targeting the treatment of nonalcoholic steatohepatitis.
3. Pfizer
Pfizer is a longtime favorite for retirees. The big pharma company's dividend yield of over 4% should keep the stock near the top of the list for income-seeking investors. Pfizer continues to prioritize its dividend program, boosting its dividend by 125% over the past 10 years.
Probably the biggest knock against Pfizer is that several of its former top-selling drugs have lost patent exclusivity, notably including Lyrica. Declining sales for these drugs present a threat to the company's near-term growth prospects. However, Pfizer is taking concrete steps to address this issue.
The company plans to merge its Upjohn unit, which is home to the drugs that have lost patent protection, with Mylan. Pfizer CEO Albert Bourla expects that Pfizer will be able to "deliver revenue and adjusted diluted EPS [earnings per share] growth through the mid-2020s that is among the industry leaders" once this transaction closes. This growth will be fueled by blockbusters such as breast cancer drug Ibrance and blood thinner Eliquis as well as anticipated blockbusters like rare-disease drug Vyndaquel.
Don't worry about getting those great dividend payments after the Upjohn-Mylan deal is completed. Although Pfizer's dividend will almost certainly decline with Upjohn no longer in the picture, the new entity resulting from the merger will also pay a dividend. Pfizer shareholders will receive shares in the merged company, with the total amount of dividend payments received remaining at least at the current level of Pfizer's dividend.
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Keith Speights owns shares of AbbVie, Gilead Sciences, and Pfizer. The Motley Fool owns shares of and recommends Gilead Sciences. The Motley Fool recommends Mylan. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The primary concern that some investors have with AbbVie is that the company is highly dependent on sales of Humira, which now faces biosimilar competition in Europe and will do so in the bigger U.S. market beginning in 2023. Current blockbuster cancer drugs Imbruvica and Venclexta, both of which continue to generate strong growth, are a key part of AbbVie's strategy. Although some investors have been skeptical about the deal, at least one Wall Street analyst, Citigroup's Andrew Baum, is optimistic, stating that "AbbVie will extract significant shareholder value from Allergan's franchises." | Here's why AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Pfizer (NYSE: PFE) stand out. AbbVie AbbVie's dividend yield of over 5.8% ranks as one of the highest among healthcare stocks. The primary concern that some investors have with AbbVie is that the company is highly dependent on sales of Humira, which now faces biosimilar competition in Europe and will do so in the bigger U.S. market beginning in 2023. | AbbVie AbbVie's dividend yield of over 5.8% ranks as one of the highest among healthcare stocks. See the 10 stocks *Stock Advisor returns as of June 1, 2019 Keith Speights owns shares of AbbVie, Gilead Sciences, and Pfizer. Here's why AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Pfizer (NYSE: PFE) stand out. | AbbVie AbbVie's dividend yield of over 5.8% ranks as one of the highest among healthcare stocks. Here's why AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Pfizer (NYSE: PFE) stand out. The primary concern that some investors have with AbbVie is that the company is highly dependent on sales of Humira, which now faces biosimilar competition in Europe and will do so in the bigger U.S. market beginning in 2023. |
24858.0 | 2019-10-11 00:00:00 UTC | Will The Pace of M&A Pick Up Following The Biotech Sector’s Pounding? | ABBV | https://www.nasdaq.com/articles/will-the-pace-of-ma-pick-up-following-the-biotech-sectors-pounding-2019-10-11 | nan | nan | Biotech is in the doldrums. The SPDR S&P Biotech ETF declined 18% in the past six months, and money continues to flow out of the sector. While several biotechs managed to IPO in September and October, it's not all roses. ADC Therapeutics pulled its plans to list citing market conditions. German unicorn BioNTech raised 40% less than initially planned and priced it at the low end of the range. Biotech management teams, whether already public or in the IPO queue, face similar challenges, forcing the exploration of alternatives including putting the company up for sale.
Source: Getty Images
The biotech industry splashed into 2019 with news that Bristol-Myers Squibb was acquiring Celgene in a behemoth $78 billion transaction. Days later, Eli Lilly pulled the trigger on its acquisition of targeted cancer drug developer Loxo Oncology for $8 billion. Following a five-month lull, AbbVie broke news in June of its proposed $63 billion acquisition of Allergan.
Are recent biotech acquisitions a sign of more to come?
Merger & acquisition activity perked up in September. First, Japanese pharma Dainippon Sumitomo announced a $3 billion deal to acquire a 10% stake in privately held Roivant Sciences and assume Roivant's ownership stakes in certain subsidiaries, including a 75.4% stake in urological disease company Urovant Sciences and a 45.5% stake in Myovant Sciences, a company developing treatments for women's health and prostate cancer. Then, 10 days later, Danish pharma Lundbeck announced its acquisition of migraine drug developer Alder BioPharmaceuticals for nearly $2 billion.
On Oct. 10, Ra Pharmaceuticals agreed to sell itself to Belgium's UCB Pharma for approximately $2.1 billion. The offer, which is more than double the price of the shares on the day prior to the announcement, should please investors. Next, we'll explore eight companies that may be ripe for a hungry pharma or big biotech to acquire.
Rare disease-focused biotechs remain attractive
Alexion (NASDAQ: ALXN) always seems to make the list of biotech acquisition targets. This profitable company made $4.5 billion in revenue over the last 12 months, with 80% coming from its drug Soliris. However, the stock declined 30% this past year. Alexion holds the unique distinction of being both an acquisition target and a potential acquirer. Its $21 billion market cap and healthy balance sheet can readily digest a transaction. Perhaps the reoccurring rumor of an Amgen (NASDAQ: AMGN) deal for Alexion will finally materialize.
Sarepta Pharmaceuticals (NASDAQ: SRPT), a controversial name that attracts long-term investors and day traders alike, has successfully brought to market Exondys 51, a treatment for Duchenne muscular dystrophy (DMD) patients with a confirmed exon 51 mutation. Sarepta sold $94.7 million in the second quarter and $181.7 million for the first half of 2019. In August, Sarepta received a Complete Response Letter from the U.S. Federal Drug Administration (FDA) for its DMD product targeting a different mutation than Exondys 51. The issue is related to infections at the site of I.V. and kidney toxicity seen in the pre-clinical animal data. Once squared away, a potential acquirer may emerge for this rare disease-focused biotech.
Pharma excels at commercializing drugs for large patient populations
Amarin (NASDAQ: AMRN) may just be the next big takeout. Amidst a backdrop of an ever-increasing volume of prescriptions for its approved drug Vascepa, the company's stock has faced recent headwinds. An FDA Advisory Committee Meeting in November will discuss and recommend for or against a proposed expansion of Vascepa's approval. The FDA called for the meeting quite late in the process, creating investor anxiety that the expanded approval is far from certain. The outcome of that meeting will adjust the risk and valuation of Amarin, setting the stage for a buyout. Just how big is Vascepa's potential? Up to 50 million people in the U.S. could benefit from the drug.
2019 has been a bumpy ride for investors in Portola Pharmaceuticals (NASDAQ: PTLA). The stock ran from $17 to $37 in the first few months of the year only to retreat to the mid-$20s. Portola markets the drugs Andexxa and Ondexxya. Both are newcomers to the market with Andexxa yielding an average of 34% quarter-over-quarter growth in the five quarters since launch. The upcoming third-quarter results will give the first meaningful look at Ondexxya, which launched at the end of the second quarter. Together they should generate in excess of $100 million in sales this year. Portola states the addressable U.S. and European patient population for the drugs is nearly 500,000 people. Delivering drugs to vast numbers of patients, historically, has been the bread and butter for large pharma companies. Don't be surprised if one jumps on Portola soon.
Oncology leads pharma and biotech deal activity
Like Eli Lilly's deal for Loxo earlier this year, Exelixis (NASDAQ: EXEL) provides a nice tuck-in oncology acquisition. Cabometyx, Exelixis' drug for treating advanced liver and kidney cancers, is on pace to exceed $1 billion in sales. The profitable company has more than $1 billion in cash on the balance sheet, yet it currently trades at a $4.9 billion valuation. Exelixis has begun to rebuild its pipeline through partnerships. Now is the time for a buyer to step in before the spending on early stage programs, which are not drivers of the current share price, increases.
Clovis Oncology (NASDAQ: CLVS) must do something and do it quickly. Rubraca, its drug approved for two ovarian cancer indications, is on pace to deliver between $137 million to $147 million in sales. However, Rubraca competes with three other drugs in the same class marketed by formidable competition: GlaxoSmithKline, AstraZeneca, and AbbVie. Debt that it incurred to fund Rubraca's commercial launch remains the noose around Clovis' neck. It refinanced its debt in August taking on $263 million due in 2024. The stock trades just over $3 per share, down from nearly $90 a few years ago. Goldman Sachs issued a sell rating and $3 price target this week while Bank of America issued a neutral rating with a $7 target. It's time to put investors out of their misery, sell the company, and move on.
Growing sales should yield buyout interest
Perennial takeout target Intercept Pharmaceuticals (NASDAQ: ICPT) focuses on non-viral liver diseases. Its lead drug Ocaliva is approved for the treatment of primary biliary cholangitis, a condition where the body's immune system attacks bile ducts in the liver leading to a toxic accumulation of bile. On Sept. 27, Intercept submitted a New Drug Application to the FDA for the treatment of fibrosis due to non-alcoholic steatohepatitis based on a successful 2,400 patient Phase 3 trial. The FDA granted Breakthrough Therapy designation which shortens the review time. With a roughly $1.9 billion valuation, $218 million in revenues over the last 12 months, and an FDA approval on the near-term horizon, this seems like a company that will not remain independent through the end of next year.
Neurocrine Biosciences (NASDAQ: NBIX) a drug developer focused on neurology and endocrinology, markets Ingrezza, the only approved treatment for tardive dyskinesia. Ingressa generated $836 million in sales since it launched two years ago. In the first half of 2019, doctors wrote nearly 56,000 prescriptions worth $317 million in sales. And it continues to grow. Neurocrine's partner AbbVie gained approval at the end of 2018 and began commercialization of Orlissa as a treatment for uterine fibroids. Neurocrine will receive royalties and potential commercial milestone payments going forward. While AbbVie is the logical acquirer, the dust first must settle on its $63 billion mega-deal with Allergan.
With the exception of Alexion and Clovis, the companies listed above share similar characteristics. Each falls into a market cap range of $1.5 billion to $10 billion. Each company markets a drug that gained approval in the last two years and relies heavily or solely on that drug for revenue. However, this is not meant to be a comprehensive list of every biotech that fits those parameters. Deals for these companies would be meaningful in size but not unmanageable for a big pharma to integrate. The acquirer gains a revenue-producing program with a built-in sales force and usually some R&D that can be pruned if necessary.
10 stocks we like better than Alexion Pharmaceuticals
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David Haen owns shares of Amarin and Exelixis. The Motley Fool owns shares of and recommends Celgene. The Motley Fool recommends Amgen, Exelixis, and Intercept Pharmaceuticals. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Following a five-month lull, AbbVie broke news in June of its proposed $63 billion acquisition of Allergan. However, Rubraca competes with three other drugs in the same class marketed by formidable competition: GlaxoSmithKline, AstraZeneca, and AbbVie. Neurocrine's partner AbbVie gained approval at the end of 2018 and began commercialization of Orlissa as a treatment for uterine fibroids. | Following a five-month lull, AbbVie broke news in June of its proposed $63 billion acquisition of Allergan. However, Rubraca competes with three other drugs in the same class marketed by formidable competition: GlaxoSmithKline, AstraZeneca, and AbbVie. Neurocrine's partner AbbVie gained approval at the end of 2018 and began commercialization of Orlissa as a treatment for uterine fibroids. | Following a five-month lull, AbbVie broke news in June of its proposed $63 billion acquisition of Allergan. However, Rubraca competes with three other drugs in the same class marketed by formidable competition: GlaxoSmithKline, AstraZeneca, and AbbVie. Neurocrine's partner AbbVie gained approval at the end of 2018 and began commercialization of Orlissa as a treatment for uterine fibroids. | Following a five-month lull, AbbVie broke news in June of its proposed $63 billion acquisition of Allergan. However, Rubraca competes with three other drugs in the same class marketed by formidable competition: GlaxoSmithKline, AstraZeneca, and AbbVie. Neurocrine's partner AbbVie gained approval at the end of 2018 and began commercialization of Orlissa as a treatment for uterine fibroids. |
24859.0 | 2019-10-11 00:00:00 UTC | 3 Big Stock Charts for Friday: AbbVie, Chubb and Applied Materials | ABBV | https://www.nasdaq.com/articles/3-big-stock-charts-for-friday%3A-abbvie-chubb-and-applied-materials-2019-10-11 | nan | nan | Investors were willing to buy in for a second day in a row, encouraged the economy may get some help after all. Though it peeled back from its intraday high and volume was soft, the S&P 500 still ended Thursday’s action up 0.64%.
Source: Shutterstock
Netflix (NASDAQ:) led the charge, gaining nearly 5% after Goldman Sachs dished out some kind words about the company. Despite its price-target cut, the investment bank still likes the stock, suggesting it only posed a “modest risk” relative to expectations. Freeport-McMoRan (NYSE:) rallied roughly as much in response to an upgrade from UBS. The bank is a fan of the fact that the mining outfit is selling off some of its weaker assets, and further predicts copper prices will rise from here.
Holding the market back was PG&E (NYSE:). The beleaguered utility name, driven to bankruptcy due to its role in California’s devastating wildfires, plunged 29% when a judge ruled that key owners of the company’s bonds would be allowed to submit a bankruptcy proposal of their own that could work against equity owners.
None of those names are as compelling as stock charts of AbbVie (NYSE:), Applied Materials (NASDAQ:) and Chubb (NYSE:) are today. Here’s why they earned a spot on watchlists.
Applied Materials (AMAT)
It has been anything but a straight-line move, but Applied Materials shares have made reliable progress since December’s bottom. The ebbs and flows have left behind a well-defined set of rising support and resistance levels, plotted as light blue dashed lines on both stock charts.
Assuming the pattern is still repeating itself, there’s more upside ahead following August’s rebound. Last week and this week gave us more evidence that AbbVie is en route to the upper boundary of its trading range. On the other hand, a couple of new concerns have taken shape.
The other bearish red flag here is the lack of volume behind the current advance, and the fact that the weekly chart’s momentum is waning. That is, the once-rising MACD lines are flattening out.
Chubb (CB)
The bears have tried to knock Chubb off of its bullish course several times since December’s low. Each time the bulls stepped up to the plate, rekindling the rally. The end result is the establishment of a rising support line marked in yellow on both stock charts.
That floor is being tested now thanks to this week’s selloff. But, this time is notably different than the prior instances. This time, CB stock is ripe for a lot of profit-taking, and the bulls are on their heels. One more bad day could start a selling avalanche.
Those aren’t the only red flags on the weekly chart. While it took a day-by-day effort to make it happen, the sheer size and scope of the setback this week translates into the biggest weekly selloff since October of last year. That sweeping change of heart (for no discernible reason) is telling in and of itself.
AbbVie (ABBV)
After an incredible 2017, AbbVie investors have experienced little more than misery. Shares peaked in early 2018, and the downtrend in the meantime was renewed just around each time it looked like it would finally come to a close.
The rebound effort that’s taken shape since August may end the same way. But, the bottom leading into that rebound was different than any of the previous ones. It may have cut deep enough to act as a capitulation. We need one more good ‘umph’ to know for sure, as that would finally get a pent-up rebound underway.
The selling may have hit a climax and set the stage for a prolonged reversal in August, as the weekly chart finally saw its RSI indicator line finally move to the sub-20, oversold level then.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about him at his website , or follow him on Twitter, at @jbrumley.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | None of those names are as compelling as stock charts of AbbVie (NYSE:), Applied Materials (NASDAQ:) and Chubb (NYSE:) are today. Last week and this week gave us more evidence that AbbVie is en route to the upper boundary of its trading range. AbbVie (ABBV) After an incredible 2017, AbbVie investors have experienced little more than misery. | None of those names are as compelling as stock charts of AbbVie (NYSE:), Applied Materials (NASDAQ:) and Chubb (NYSE:) are today. Last week and this week gave us more evidence that AbbVie is en route to the upper boundary of its trading range. AbbVie (ABBV) After an incredible 2017, AbbVie investors have experienced little more than misery. | None of those names are as compelling as stock charts of AbbVie (NYSE:), Applied Materials (NASDAQ:) and Chubb (NYSE:) are today. Last week and this week gave us more evidence that AbbVie is en route to the upper boundary of its trading range. AbbVie (ABBV) After an incredible 2017, AbbVie investors have experienced little more than misery. | None of those names are as compelling as stock charts of AbbVie (NYSE:), Applied Materials (NASDAQ:) and Chubb (NYSE:) are today. Last week and this week gave us more evidence that AbbVie is en route to the upper boundary of its trading range. AbbVie (ABBV) After an incredible 2017, AbbVie investors have experienced little more than misery. |
24860.0 | 2019-10-10 00:00:00 UTC | Health Care Sector Update for 10/10/2019: IONS,RETA,ABBV,RARX,CGC,WEED.TO | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-10-10-2019%3A-ionsretaabbvrarxcgcweed.to-2019-10-10 | nan | nan | Top Health Care Stocks
JNJ -0.17%
PFE +0.21%
ABT +0.87%
MRK -0.48%
AMGN +0.88%
Health care stocks continue to post modest gains shortly before Thursday's closing bell, with the NYSE Health Care Index rising nearly 0.2% this afternoon while the shares of health care companies in the S&P 500 also were up more than 0.4% as a group. The Nasdaq Biotechnology index resisted the late slide for many sectors, climbing over 1.2% in late trade.
Among health care stocks moving on news:
(+) Ionis Pharmaceuticals (IONS) rose over 3% on Thursday after Wells Fargo increased its price target for the genetic medicines company by 33.3% over its previous forecast to $120 a share and reiterated its outperform investment rating for Ionis' stock.
In other sector news:
(+) Ra Pharmaceuticals (RARX) more than doubled in price on Thursday, rising 101%, after agreeing to a $2.1 billion buyout offer from Belgian biopharmaceutical company UCB. Under terms of the proposed transaction, UCB will pay $48 in cash for each Ra Pharma share, or more than double Wednesday's closing price.
(+) Reata Pharmaceuticals (RETA) jumped 13% on Thursday after the specialty drugmaker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone.
(-) Canopy Growth (CGC) dropped 10.5% after David Klein, the current chief financial officer at beer and liquor company Constellation Brands (STZ), was named board chairman at the Canadian cannabis company, effective immediately, succeeding interim chairman John Bell. The move follows Constellation - which invested $5 billion in Canopy last year and earlier this month reported a $500 million loss on that investment - three months ago ousting Canopy founder and co-chief executive Bruce Linton.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (+) Reata Pharmaceuticals (RETA) jumped 13% on Thursday after the specialty drugmaker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. In other sector news: (+) Ra Pharmaceuticals (RARX) more than doubled in price on Thursday, rising 101%, after agreeing to a $2.1 billion buyout offer from Belgian biopharmaceutical company UCB. | (+) Reata Pharmaceuticals (RETA) jumped 13% on Thursday after the specialty drugmaker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. Health care stocks continue to post modest gains shortly before Thursday's closing bell, with the NYSE Health Care Index rising nearly 0.2% this afternoon while the shares of health care companies in the S&P 500 also were up more than 0.4% as a group. | (+) Reata Pharmaceuticals (RETA) jumped 13% on Thursday after the specialty drugmaker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. Health care stocks continue to post modest gains shortly before Thursday's closing bell, with the NYSE Health Care Index rising nearly 0.2% this afternoon while the shares of health care companies in the S&P 500 also were up more than 0.4% as a group. | (+) Reata Pharmaceuticals (RETA) jumped 13% on Thursday after the specialty drugmaker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. The Nasdaq Biotechnology index resisted the late slide for many sectors, climbing over 1.2% in late trade. |
24861.0 | 2019-10-10 00:00:00 UTC | Health Care Sector Update for 10/10/2019: RETA,ABBV,RARX,CGC | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-10-10-2019%3A-retaabbvrarxcgc-2019-10-10 | nan | nan | Top Health Care Stocks
JNJ +0.16%
PFE +0.24%
ABT +0.79%
MRK +0.10%
AMGN +0.90%
Health care stocks were posting modest gains, with the NYSE Health Care Index rising nearly 0.3% this afternoon while the shares of health care companies in the S&P 500 also were up almost 0.5% as a group. The Nasdaq Biotechnology index was climbing over 0.8%.
Among health care stocks moving on news:
(+) Reata Pharmaceuticals (RETA) jumped 12% on Thursday after the specialty drug maker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone.
In other sector news:
(+) Ra Pharmaceuticals (RARX) nearly doubled in price on Thursday, rising just under 100%, after agreeing to a $2.1 billion buyout offer from Belgian biopharmaceutical company UCB. Under terms of the proposed transaction, UCB will pay $48 in cash for each Ra Pharma share, or more than double Wednesday's closing price.
(-) Canopy Growth (CGC) dropped over 9% after David Klein, the current chief financial officer at beer and liquor company Constellation Brands (STZ), was named board chairman at the Canadian cannabis company, effective immediately, succeeding interim chairman John Bell. The move follows Constellation - which invested $5 billion in Canopy last year and earlier this month reported a $500 million loss on that investment - three months ago ousting Canopy founder, co-CEO and chairman Bruce Linton.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among health care stocks moving on news: (+) Reata Pharmaceuticals (RETA) jumped 12% on Thursday after the specialty drug maker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. In other sector news: (+) Ra Pharmaceuticals (RARX) nearly doubled in price on Thursday, rising just under 100%, after agreeing to a $2.1 billion buyout offer from Belgian biopharmaceutical company UCB. | Among health care stocks moving on news: (+) Reata Pharmaceuticals (RETA) jumped 12% on Thursday after the specialty drug maker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. Health care stocks were posting modest gains, with the NYSE Health Care Index rising nearly 0.3% this afternoon while the shares of health care companies in the S&P 500 also were up almost 0.5% as a group. | Among health care stocks moving on news: (+) Reata Pharmaceuticals (RETA) jumped 12% on Thursday after the specialty drug maker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. Health care stocks were posting modest gains, with the NYSE Health Care Index rising nearly 0.3% this afternoon while the shares of health care companies in the S&P 500 also were up almost 0.5% as a group. | Among health care stocks moving on news: (+) Reata Pharmaceuticals (RETA) jumped 12% on Thursday after the specialty drug maker reacquired development and commercialization rights for its proprietary Nrf2 activator product platform from AbbVie (ABBV) for $330 million in cash, consisting of a $75 million upfront payment in 2019 and the remainder payable in Q2 2020 and Q4 2021. AbbVie also will receive low single-digit, tiered royalties from worldwide sales of omaveloxolone and certain next-generation Nrf2 activators but no royalties on bardoxolone. Top Health Care Stocks |
24862.0 | 2019-10-10 00:00:00 UTC | Notable Thursday Option Activity: ABBV, GILD, SWKS | ABBV | https://www.nasdaq.com/articles/notable-thursday-option-activity%3A-abbv-gild-swks-2019-10-10 | nan | nan | Looking at options trading activity among components of the S&P 500 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 120,551 contracts has been traded thus far today, a contract volume which is representative of approximately 12.1 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 154.9% of ABBV's average daily trading volume over the past month, of 7.8 million shares. Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 28,832 contracts trading so far today, representing approximately 2.9 million underlying shares of ABBV. Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange:
Gilead Sciences Inc (Symbol: GILD) saw options trading volume of 48,951 contracts, representing approximately 4.9 million underlying shares or approximately 86% of GILD's average daily trading volume over the past month, of 5.7 million shares. Especially high volume was seen for the $62.50 strike call option expiring October 11, 2019, with 14,603 contracts trading so far today, representing approximately 1.5 million underlying shares of GILD. Below is a chart showing GILD's trailing twelve month trading history, with the $62.50 strike highlighted in orange:
And Skyworks Solutions Inc (Symbol: SWKS) saw options trading volume of 10,647 contracts, representing approximately 1.1 million underlying shares or approximately 61.6% of SWKS's average daily trading volume over the past month, of 1.7 million shares. Particularly high volume was seen for the $85 strike call option expiring October 18, 2019, with 878 contracts trading so far today, representing approximately 87,800 underlying shares of SWKS. Below is a chart showing SWKS's trailing twelve month trading history, with the $85 strike highlighted in orange:
For the various different available expirations for ABBV options, GILD options, or SWKS options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 28,832 contracts trading so far today, representing approximately 2.9 million underlying shares of ABBV. Looking at options trading activity among components of the S&P 500 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 120,551 contracts has been traded thus far today, a contract volume which is representative of approximately 12.1 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 154.9% of ABBV's average daily trading volume over the past month, of 7.8 million shares. | Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 28,832 contracts trading so far today, representing approximately 2.9 million underlying shares of ABBV. Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange: Gilead Sciences Inc (Symbol: GILD) saw options trading volume of 48,951 contracts, representing approximately 4.9 million underlying shares or approximately 86% of GILD's average daily trading volume over the past month, of 5.7 million shares. Looking at options trading activity among components of the S&P 500 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 120,551 contracts has been traded thus far today, a contract volume which is representative of approximately 12.1 million underlying shares (given that every 1 contract represents 100 underlying shares). | Looking at options trading activity among components of the S&P 500 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 120,551 contracts has been traded thus far today, a contract volume which is representative of approximately 12.1 million underlying shares (given that every 1 contract represents 100 underlying shares). Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange: Gilead Sciences Inc (Symbol: GILD) saw options trading volume of 48,951 contracts, representing approximately 4.9 million underlying shares or approximately 86% of GILD's average daily trading volume over the past month, of 5.7 million shares. That number works out to 154.9% of ABBV's average daily trading volume over the past month, of 7.8 million shares. | Looking at options trading activity among components of the S&P 500 index, there is noteworthy activity today in AbbVie Inc (Symbol: ABBV), where a total volume of 120,551 contracts has been traded thus far today, a contract volume which is representative of approximately 12.1 million underlying shares (given that every 1 contract represents 100 underlying shares). Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange: Gilead Sciences Inc (Symbol: GILD) saw options trading volume of 48,951 contracts, representing approximately 4.9 million underlying shares or approximately 86% of GILD's average daily trading volume over the past month, of 5.7 million shares. That number works out to 154.9% of ABBV's average daily trading volume over the past month, of 7.8 million shares. |
24863.0 | 2019-10-10 00:00:00 UTC | 3 Big Pharma Companies Driving Price Inflation | ABBV | https://www.nasdaq.com/articles/3-big-pharma-companies-driving-price-inflation-2019-10-10 | nan | nan | America is just about the only place on earth that allows drugmakers to set and raise the price of successful drugs to whatever the market will bear, and it shows. Between the fourth quarter of 2016 and the fourth quarter of 2018, the big biopharmaceutical companies below raised prices for these popular treatments at a rate four times faster than inflation.
Sometimes new clinical data shows a drug's benefit is better than everyone thought and an argument can be made that the new price reflects the new information. That hasn't happened with these drugs, but the companies announced huge price increases anyway.
Data source: Institute for Clinical and Economic Review. WAC = Wholesale acquisition cost. Q4 = Fourth quarter.
These egregious price increases wouldn't be possible if Medicare were able to negotiate, but the U.S. government isn't allowed to set a maximum price that it's willing to pay.
If this unique aspect of the U.S. market suddenly fell in line with the rest of the world, how badly would it hurt these three pharma stocks? Read on to find out.
Image source: Getty Images.
1. AbbVie: Humira
AbbVie's flagship anti-inflammation injection, Humira, has proven itself useful many times over since launching in 2002 -- but not during the two-year period between the end of 2016 and 2018. European sales of Humira are already sinking in response to biosimilar competition, and AbbVie offset a lot of that loss by raising the list price in the U.S. 19.1% during the time frame studied.
The Institute for Clinical and Economic Review (ICER) thinks Humira's net sales increase worked out to $1.86 billion between the end of 2016 and the end of 2018. If AbbVie had simply raised Humira's price in line with the medical care consumer price index (CPI), though, it would have risen around $427 million.
Unfortunately for AbbVie, huge unjustified price increases for Humira weren't enough to keep the entire company's needle moving forward. Trailing net income has tumbled 31% since the end of 2016 to $4.1 billion at the moment.
Running fewer clinical trials means an awful lot of Humira revenue reaches AbbVie's bottom line. If the company was suddenly limited to price increases in line with inflation, it wouldn't lead to complete catastrophe, but it would tear a significant chunk out of earnings that are already under pressure.
Image source: Getty Images.
2. Pfizer: Lyrica
This past June, Pfizer's Lyrica lost patent protection in the U.S. and sales of the blockbuster nerve pain reliever have already started falling. If Pfizer limited its price increases to the rate of inflation, the company would have left around $575 million in high-margin Lyrica revenue on the table.
Since the end of 2016, Pfizer's trailing net income has increased by 75% to a whopping $12.7 billion at the moment. If Pfizer was suddenly required to limit price increases on its most popular treatments to the rate of inflation, its bottom line would probably continue climbing.
3. Gilead Sciences: Genvoya and Truvada
Unlike AbbVie, Gilead Sciences has been making unjustified increases to the prices of two HIV treatments, Truvada and Genvoya, several years ahead of their expected loss of exclusivity in the U.S. market.
Genvoya is a four-drug tablet that keeps the HIV virus at bay as long as patients swallow one every day for the rest of their lives, and it probably won't lose market exclusivity for another decade. Genvoya launched in 2015 and Gilead launched a new three-drug tablet called Biktarvy last year that should be safer for patients. Gilead would benefit a great deal if patients upgraded their lifelong treatment option from Genvoya to Biktarvy, which could explain why Gilead raised Genvoya's net price even faster than its list price.
Truvada is a 17-year-old treatment for HIV that's become quite popular among healthy people since the FDA expanded its label to include pre-exposure prophylaxis (PrEP) in 2012. The FDA has approved a generic version, but pediatric exclusivity will probably keep generic competition from reaching pharmacy shelves until 2021.
Recently, the FDA approved a safer alternative for PrEP from Gilead called Descovy at a list price of around $60 per pill. At the expense of its public image, the company has raised Truvada's price to the same level as Descovy. Rebates and discounts are closely guarded secrets, but I'd bet a bottle of these pills that Descovy's significantly less expensive than Truvada right now from an insurer's standpoint.
Despite Gilead's successfully switching as many patients as possible to new products with longer periods of exclusivity ahead of them, the company's trailing net income has fallen around 56% since the end of 2016 to $6 billion.
Gilead catches a lot of flak for the way it's encouraging patients to switch, but it's important to point out that the company recorded $5.1 billion in research and development expenses over the past 12 months. Profits have tanked, but the company's annual R&D budget has hardly budged since the end of 2016.
Image source: Getty Images.
Schrodinger's medicine
It's impossible to know exactly how much of an impact letting Medicare negotiate could have on the pace of innovation, but it would be significant.
Here's what we know for sure: A near-record 69 biotech companies made their stock market debut on the Nasdaq exchange last year, and hundreds more raised nine-figure sums privately to develop new drugs. Worldwide, the rate of new drug discovery and development has never been faster than it is right now. This would not be the case if companies like Gilead, Pfizer, and AbbVie hadn't spent the previous decade shoveling enormous profits at potential new drugs.
10 stocks we like better than Pfizer
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | European sales of Humira are already sinking in response to biosimilar competition, and AbbVie offset a lot of that loss by raising the list price in the U.S. 19.1% during the time frame studied. AbbVie: Humira AbbVie's flagship anti-inflammation injection, Humira, has proven itself useful many times over since launching in 2002 -- but not during the two-year period between the end of 2016 and 2018. If AbbVie had simply raised Humira's price in line with the medical care consumer price index (CPI), though, it would have risen around $427 million. | Running fewer clinical trials means an awful lot of Humira revenue reaches AbbVie's bottom line. Gilead Sciences: Genvoya and Truvada Unlike AbbVie, Gilead Sciences has been making unjustified increases to the prices of two HIV treatments, Truvada and Genvoya, several years ahead of their expected loss of exclusivity in the U.S. market. AbbVie: Humira AbbVie's flagship anti-inflammation injection, Humira, has proven itself useful many times over since launching in 2002 -- but not during the two-year period between the end of 2016 and 2018. | Gilead Sciences: Genvoya and Truvada Unlike AbbVie, Gilead Sciences has been making unjustified increases to the prices of two HIV treatments, Truvada and Genvoya, several years ahead of their expected loss of exclusivity in the U.S. market. AbbVie: Humira AbbVie's flagship anti-inflammation injection, Humira, has proven itself useful many times over since launching in 2002 -- but not during the two-year period between the end of 2016 and 2018. European sales of Humira are already sinking in response to biosimilar competition, and AbbVie offset a lot of that loss by raising the list price in the U.S. 19.1% during the time frame studied. | Gilead Sciences: Genvoya and Truvada Unlike AbbVie, Gilead Sciences has been making unjustified increases to the prices of two HIV treatments, Truvada and Genvoya, several years ahead of their expected loss of exclusivity in the U.S. market. AbbVie: Humira AbbVie's flagship anti-inflammation injection, Humira, has proven itself useful many times over since launching in 2002 -- but not during the two-year period between the end of 2016 and 2018. European sales of Humira are already sinking in response to biosimilar competition, and AbbVie offset a lot of that loss by raising the list price in the U.S. 19.1% during the time frame studied. |
24864.0 | 2019-10-08 00:00:00 UTC | Why AbbVie's Stock Jumped in September | ABBV | https://www.nasdaq.com/articles/why-abbvies-stock-jumped-in-september-2019-10-08 | nan | nan | What happened
Shares of biotech giant AbbVie (NYSE: ABBV) gained a healthy 15% in September, according to data from S&P Global Market Intelligence.
The spark? AbbVie's shares perked up after the company's presentation at the Morgan Stanley Healthcare Conference on Sept. 10. While the company didn't reveal anything new during this presentation, CEO Richard Gonzalez's comments about the upcoming Allergan (NYSE: AGN) acquisition, as well as how the company plans to create value as Humira goes off patent, appear to have gone a long way toward reassuring investors.
Image source: Getty Images.
So what
Prior to last month's rally, AbbVie's shares were down by an unsightly 28% for the year, thanks to the growing concerns about Humira's future. In short, AbbVie's flagship medication has been experiencing a sharper-than-expected drop in international sales following the introduction of biosimilars in Europe. A similar pattern could very well emerge in the U.S. once biosimilars hit the market.
As Gonzalez noted during this latest investor presentation, though, AbbVie should be able to continue to post industry-leading levels of revenue and earnings growth well into the next decade, even after Humira loses patent protection in the United States. Keeping with this theme, this megamerger with Allergan will immediately lower Humira's overall importance in terms of revenue growth and the biotech now sports a healthy stable of new growth products -- several of which should turn out to be megablockbusters in their own right.
Now what
Can AbbVie's shares continue to rebound? The short answer is yes. AbbVie has been one of the cheapest large-cap biotech stocks for the better part of the last 12 months. So, as the fear over Humira's demise begins to fade and the positive impacts of this Allergen tie-up come into view, AbbVie's shares should begin to garner a more typical valuation for a top biotech.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of biotech giant AbbVie (NYSE: ABBV) gained a healthy 15% in September, according to data from S&P Global Market Intelligence. In short, AbbVie's flagship medication has been experiencing a sharper-than-expected drop in international sales following the introduction of biosimilars in Europe. As Gonzalez noted during this latest investor presentation, though, AbbVie should be able to continue to post industry-leading levels of revenue and earnings growth well into the next decade, even after Humira loses patent protection in the United States. | Now what Can AbbVie's shares continue to rebound? So, as the fear over Humira's demise begins to fade and the positive impacts of this Allergen tie-up come into view, AbbVie's shares should begin to garner a more typical valuation for a top biotech. What happened Shares of biotech giant AbbVie (NYSE: ABBV) gained a healthy 15% in September, according to data from S&P Global Market Intelligence. | So, as the fear over Humira's demise begins to fade and the positive impacts of this Allergen tie-up come into view, AbbVie's shares should begin to garner a more typical valuation for a top biotech. 10 stocks we like better than AbbVie When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. What happened Shares of biotech giant AbbVie (NYSE: ABBV) gained a healthy 15% in September, according to data from S&P Global Market Intelligence. | As Gonzalez noted during this latest investor presentation, though, AbbVie should be able to continue to post industry-leading levels of revenue and earnings growth well into the next decade, even after Humira loses patent protection in the United States. What happened Shares of biotech giant AbbVie (NYSE: ABBV) gained a healthy 15% in September, according to data from S&P Global Market Intelligence. AbbVie's shares perked up after the company's presentation at the Morgan Stanley Healthcare Conference on Sept. 10. |
24865.0 | 2019-10-07 00:00:00 UTC | Why Johnson & Johnson Stock Is Not a Screaming Buy | ABBV | https://www.nasdaq.com/articles/why-johnson-johnson-stock-is-not-a-screaming-buy-2019-10-07 | nan | nan | Johnson & Johnson (NYSE:) stock has been a disappointing under-performer this year. While the S&P 500 is up nearly 18% year-to-date, JNJ stock is up just 5.7% (including dividends reinvested).
Source: Sundry Photography / Shutterstock.com
The company’s countless have impacted the JNJ stock price. But recent developments have made the opioid litigation risks clearer. As seen from the recent settlement dollar amounts ($572 million in Oklahoma and $20.4 million in two Ohio counties), the company will likely not see the value-destroying verdicts experienced by and (OTCMKTS:INSYQ).
However, the potential litigation risk remains massive. Multiply the 2,000+ pending lawsuits by at least $20 million, and you get at least $40 billion in potential litigation settlements. With shares valued in line with big pharma peers, the stock does not appear to be a value play. Let’s take a closer look, and see why the current JNJ stock price is not a compelling entry point.
Paging Dr. Catalyst
What positive developments could move the JNJ stock price? Despite the opioid crisis weighing on shares, Credit Suisse’s is bullish on JNJ’s pharma growth prospects. He believes that once the company’s legal issues are quantified, the market will shift focus towards the pharma unit’s organic growth. This growth could drive the stock over the next few years.
If growth doesn’t do it, the company’s dividend should keep the stock from falling down further. The company pays a 2.84% yield. When I last wrote about Johnson & Johnson stock, I discussed the company’s status as a . Slow growth could impact this dividend, but luckily, the payout ratio is low (43.7%). In other words, JNJ has plenty of room to grow the dividend for the 58th year in a row.
Dividend aristocrat status provides a floor in the Johnson & Johnson stock price. But looking beyond dividends, is the stock a good value? Let’s compare the company to its big pharma peers, and see if shares are cheap on a relative basis.
JNJ Stock Fairly Valued
Johnson & Johnson stock trades in line with its peers. The company’s forward price-to-earnings ratio is 14.6. Its enterprise-value-to-EBITDA is 13.1. Here are the valuation metrics for JNJ’s myriad of big pharma peers:
AstraZeneca PLC (NYSE:): Forward P/E of 10.6; EV/EBITDA of 11.5
Bristol Myers Squibb (NYSE:): Forward P/E of 8.6; EV/EBITDA of 10.4
GlaxoSmithKline PLC (NYSE:): Forward P/E of 13.8; EV/EBITDA of 10.2
Eli Lilly (NYSE:): Forward P/E of 16.3; EV/EBITDA of 15.3
Merck (NYSE:): Forward P/E of 15.4 ; EV/EBITDA of 13.9
Novartis (NYSE:): Forward P/E of 26; EV/EBITDA of 37.8
Pfizer (NYSE:): Forward P/E of 12.8; EV/EBITDA of 10.5
But JNJ is more than a pharma company. Its other units are Medical Devices and the ubiquitous Consumer Products unit (Band-Aids, Tylenol). Medical device stocks such as Becton Dickinson (NYSE:) sell at EBITDA multiples above 17x. Consumer products companies like Procter & Gamble (NYSE:) trade at even higher EBITDA multiples (19.4x).
Perhaps someday Johnson & Johnson would find it beneficial to split the company into three. While this would likely need to occur after the opioid suits are settled, in the longer term, a “trivestiture” could unlock value in the JNJ stock price. But for the time being, investors must contend with Johnson & Johnson as a one-stop health products shop.
Pass on Johnson & Johnson Stock
I agree with InvestorPlace contributor Vince Martin’s recent of JNJ stock. The company is not a short candidate. But at the same time, the stock is not a compelling buy. With its dividend aristocrat status, shares should at least tread water over the next several years. Until the litigation issues are resolved, the company will have billions in liabilities hanging over its head. While JNJ can likely afford to settle these liabilities, it still provides a headwind in the medium term.
Sometime in the future, the company could unlock value via spinoffs. The company is currently valued using pharmaceutical valuations alone. But the Consumer and Medical Devices divisions likely could fetch higher valuations.
Splitting the company is an obvious solution. In fact, activists have pushed for it . But given their lack of success, don’t bank on “strategic alternatives” in the short term. For dividend investors looking for a high quality name, Johnson & Johnson stock may be a solid opportunity. For investors looking for a stock to rebound, better opportunities lie elsewhere.
As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Despite the opioid crisis weighing on shares, Credit Suisse’s is bullish on JNJ’s pharma growth prospects. He believes that once the company’s legal issues are quantified, the market will shift focus towards the pharma unit’s organic growth. While this would likely need to occur after the opioid suits are settled, in the longer term, a “trivestiture” could unlock value in the JNJ stock price. | With shares valued in line with big pharma peers, the stock does not appear to be a value play. JNJ Stock Fairly Valued Johnson & Johnson stock trades in line with its peers. Consumer products companies like Procter & Gamble (NYSE:) trade at even higher EBITDA multiples (19.4x). | JNJ Stock Fairly Valued Johnson & Johnson stock trades in line with its peers. Here are the valuation metrics for JNJ’s myriad of big pharma peers: AstraZeneca PLC (NYSE:): Forward P/E of 10.6; EV/EBITDA of 11.5 Bristol Myers Squibb (NYSE:): Forward P/E of 8.6; EV/EBITDA of 10.4 GlaxoSmithKline PLC (NYSE:): Forward P/E of 13.8; EV/EBITDA of 10.2 Eli Lilly (NYSE:): Forward P/E of 16.3; EV/EBITDA of 15.3 Merck (NYSE:): Forward P/E of 15.4 ; EV/EBITDA of 13.9 Novartis (NYSE:): Forward P/E of 26; EV/EBITDA of 37.8 Pfizer (NYSE:): Forward P/E of 12.8; EV/EBITDA of 10.5 But JNJ is more than a pharma company. Pass on Johnson & Johnson Stock I agree with InvestorPlace contributor Vince Martin’s recent of JNJ stock. | Johnson & Johnson (NYSE:) stock has been a disappointing under-performer this year. Dividend aristocrat status provides a floor in the Johnson & Johnson stock price. While this would likely need to occur after the opioid suits are settled, in the longer term, a “trivestiture” could unlock value in the JNJ stock price. |
24866.0 | 2019-10-06 00:00:00 UTC | 3 Top Dividend Stocks to Buy Right Now | ABBV | https://www.nasdaq.com/articles/3-top-dividend-stocks-to-buy-right-now-2019-10-06 | nan | nan | There's just something satisfying about a stock that pays you to own it. And that's exactly what dividend stocks do. Of course, some of them are better than others.
Three top dividend stocks that investors can buy right now are AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Brookfield Infrastructure Partners (NYSE: BIP). Here's why they stand out.
Image source: Getty Images.
1. AbbVie
AbbVie pays a dividend that currently yields 5.72%. The big pharma company also has an impressive track record when it comes to dividend hikes. It has increased its payout by nearly 168% since it was spun off by Abbott Laboratories in 2013.
Should you worry about AbbVie's continued ability to sustain its dividend, given that its top-selling drug Humira faces competition from biosimilars and that the company is taking on debt to fund its planned acquisition of Allergan? I don't think so. The buyout of Allergan shouldn't hider AbbVie's ability to continue paying solid dividends, and the purchase will help reduce its reliance on Humira.
Further, AbbVie isn't a one-trick pony. Its blood cancer drugs Imbruvica and Venclexta continue to deliver impressive sales growth, and management expects that Orilissa will be a blockbuster success in treating endometriosis and uterine fibroids.
Its big rising stars are immunology drugs Rinvoq and Skyrizi. Both received U.S. Food and Drug Administration approval this year, and are ranked as two of EvaluatePharma's top three new drug launches of 2019. They could combine for annual sales of more than $10 billion. Thanks to growing sales for Rinvoq and Skyrizi, along with sustained momentum for its other current drugs and the expected contribution from Allergan's products, AbbVie should be able to keep its juicy dividend payouts flowing for a long time to come.
2. AT&T
Not only does AT&T offer a high dividend yield, but its shares have also delivered a terrific performance so far in 2019, soaring more than 30%. The telecommunications and media giant's yield stands at 5.5%, and it has increased its payout for 35 years in a row.
Sure, AT&T faces some challenges. Its TV business continues to struggle. DirecTV has been an albatross around the company's neck, and its HBO unit lost a lot of subscribers after Game of Thrones wrapped up.
But the company thinks it may have a winner with its new HBO Max streaming service, which will bring together HBO's deep content catalog, new programs, and other hit shows, notably including the still-popular series Friends.
AT&T should also profit from the coming high-speed 5G wireless boom. This drastically faster service is just beginning to roll out in some parts of the U.S.; AT&T has deployed 5G infrastructure in about 20 major markets so far. As more new smartphones hit the market that can take advantage, look for AT&T to reap the rewards from those investments.
3. Brookfield Infrastructure Partners
Brookfield Infrastructure Partners' dividend currently yields 4.4%. What's even better is that the company has consistently increased its dividend by between 7% and 9% each year, and should be able to keep doing so.
You can think of Brookfield Infrastructure Partners as a utility stock that's turbocharged. The company operates several utilities, including regulated natural gas pipelines in Brazil, electricity transmission in North and South America, and a natural gas and electricity distribution business in the U.S. But it also owns non-utility assets including data centers, cell towers, natural gas storage facilities, railroads, ports, and toll roads.
The really great thing about its business model is that it generates a steady revenue stream. Its assets are diversified across industries and geographical regions. And with the exception of its transport businesses, those revenue sources are highly recession-resistant.
Most utility stocks don't come with significant growth prospects. But Brookfield Infrastructure does. The company's strategy is to rotate assets, selling the less profitable ones and reinvesting in more profitable businesses. As a result of this approach, Brookfield Infrastructure Partners has been able to grow its funds from operations by 6% to 9% annually. Solid dividends plus solid growth prospects make this stock a solid pick for income investors.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Should you worry about AbbVie's continued ability to sustain its dividend, given that its top-selling drug Humira faces competition from biosimilars and that the company is taking on debt to fund its planned acquisition of Allergan? Thanks to growing sales for Rinvoq and Skyrizi, along with sustained momentum for its other current drugs and the expected contribution from Allergan's products, AbbVie should be able to keep its juicy dividend payouts flowing for a long time to come. Three top dividend stocks that investors can buy right now are AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Brookfield Infrastructure Partners (NYSE: BIP). | Three top dividend stocks that investors can buy right now are AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Brookfield Infrastructure Partners (NYSE: BIP). The buyout of Allergan shouldn't hider AbbVie's ability to continue paying solid dividends, and the purchase will help reduce its reliance on Humira. AbbVie AbbVie pays a dividend that currently yields 5.72%. | Three top dividend stocks that investors can buy right now are AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Brookfield Infrastructure Partners (NYSE: BIP). Should you worry about AbbVie's continued ability to sustain its dividend, given that its top-selling drug Humira faces competition from biosimilars and that the company is taking on debt to fund its planned acquisition of Allergan? AbbVie AbbVie pays a dividend that currently yields 5.72%. | AbbVie AbbVie pays a dividend that currently yields 5.72%. Three top dividend stocks that investors can buy right now are AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Brookfield Infrastructure Partners (NYSE: BIP). Should you worry about AbbVie's continued ability to sustain its dividend, given that its top-selling drug Humira faces competition from biosimilars and that the company is taking on debt to fund its planned acquisition of Allergan? |
24867.0 | 2019-10-03 00:00:00 UTC | 2 Great Stocks You Can Buy on Sale | ABBV | https://www.nasdaq.com/articles/2-great-stocks-you-can-buy-on-sale-2019-10-03 | nan | nan | The stock market's recent volatility shouldn't concern investors with a long-term outlook. In fact, it's probably a blessing in disguise for the buy-and-hold crowd. Several great stocks, after all, are now trading at attractive valuations.
In the beaten-up healthcare sector, for instance, AbbVie (NYSE: ABBV) and Amgen (NASDAQ: AMGN) stand out as two outstanding buys following their poor showing through the first nine months of 2019. Here's why these top dividend-paying biotech stocks are worth adding to your portfolio right now.
Image source: Getty Images.
AbbVie: Buy the fear
AbbVie's shares are shrouded in fear right now. The singular reason is that the company's main revenue source -- the anti-inflammatory drug Humira -- has firmly entered the back end of its rather remarkable run as one of the industry's most profitable products.
Emphasizing this point, Humira's sales appear to have crested at around $20 billion in 2018, with biosimilars taking a heavy toll in Europe this year. Some Wall Street analysts have even floated the idea that Humira's sales might plummet by an eye-popping 85% from their former high-water mark by 2025. That's obviously not a favorable trend line, but it's also not the end of the world.
AbbVie has built out a solid portfolio of next-generation products and it recently inked a merger agreement with Allergan (NYSE: AGN) that will immediately soften the blow from Humira's demise. Underscoring this point, AbbVie should have no fewer than six blockbuster products (Botox, Imbruvica, Orilissa, Rinvoq, Skyrizi, and Venclexta) by 2025, thanks to its top-notch clinical pipeline and tie-up with Allergan.
Apart from AbbVie's impressive portfolio of newer growth products, there are two more compelling reasons to consider buying this elite biotech stock soon. First, AbbVie's shares are dirt cheap right now at 7.56 times forward earnings. Second, this Dividend Aristocrat sports a substantial yield of 5.84% at current levels. Bargain-hunters, in kind, should probably take advantage of AbbVie's yearlong downturn. This top drugmaker will eventually rebound after all.
Amgen: Better days are ahead
Amgen's shares have fallen by nearly 3% so far this year. As a result, the stock is now trading at 12 times forward earnings, which is a lower-tier valuation for a blue chip biotech -- especially one that sports a slightly above-average dividend yield of 3%. Still, the market appears more than content to simply sit on the sidelines when it comes to this top dividend stock, despite its attractive valuation and juicy dividend.
What's keeping investors at bay? Amgen is going through a radical makeover right now, and the final product remains a work in progress, to put it mildly. The brief rundown is that newer growth products like the migraine treatment Aimovig and cholesterol-lowering drug Repatha haven't been able to fully offset the declines emanating from the biotech's portfolio of aging superstars. Amgen's top line, in fact, is forecast to dip by 3.9% in 2019.
Another area of concern is the biotech's oncology portfolio. Some of the company's most important early-stage cancer assets simply haven't lived up to expectations in the clinic. These setbacks have weighed on Amgen's shares this year, which makes sense given their importance to the biotech's long-term value proposition.
Still, there are two solid reasons to consider buying this blue chip biotech stock right now. First up, Amgen's recent acquisition of the anti-inflammatory medicine Otezla is expected to immediately boost earnings and quarterly sales. The company should, in fact, return to top-line growth by next year. Second, Amgen has one of the largest cash positions within the entire space. So there's a good chance that the biotech will pursue more bolt-on acquisitions in order to accelerate its return to form.
The bottom line is that Amgen definitely has the pieces in place to move past these various headwinds. Now, this turnaround may not materialize overnight, but it will almost certainly happen. As such, patient investors may want to dig into this story before the market starts to change its tune.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie has built out a solid portfolio of next-generation products and it recently inked a merger agreement with Allergan (NYSE: AGN) that will immediately soften the blow from Humira's demise. In the beaten-up healthcare sector, for instance, AbbVie (NYSE: ABBV) and Amgen (NASDAQ: AMGN) stand out as two outstanding buys following their poor showing through the first nine months of 2019. AbbVie: Buy the fear AbbVie's shares are shrouded in fear right now. | In the beaten-up healthcare sector, for instance, AbbVie (NYSE: ABBV) and Amgen (NASDAQ: AMGN) stand out as two outstanding buys following their poor showing through the first nine months of 2019. AbbVie: Buy the fear AbbVie's shares are shrouded in fear right now. AbbVie has built out a solid portfolio of next-generation products and it recently inked a merger agreement with Allergan (NYSE: AGN) that will immediately soften the blow from Humira's demise. | Apart from AbbVie's impressive portfolio of newer growth products, there are two more compelling reasons to consider buying this elite biotech stock soon. In the beaten-up healthcare sector, for instance, AbbVie (NYSE: ABBV) and Amgen (NASDAQ: AMGN) stand out as two outstanding buys following their poor showing through the first nine months of 2019. AbbVie: Buy the fear AbbVie's shares are shrouded in fear right now. | Apart from AbbVie's impressive portfolio of newer growth products, there are two more compelling reasons to consider buying this elite biotech stock soon. In the beaten-up healthcare sector, for instance, AbbVie (NYSE: ABBV) and Amgen (NASDAQ: AMGN) stand out as two outstanding buys following their poor showing through the first nine months of 2019. AbbVie: Buy the fear AbbVie's shares are shrouded in fear right now. |
24868.0 | 2019-10-03 00:00:00 UTC | 3 Stocks to Supplement Your Social Security Income | ABBV | https://www.nasdaq.com/articles/3-stocks-to-supplement-your-social-security-income-2019-10-03 | nan | nan | In any discussion about investing in retirement, conventional wisdom contends that bonds are the way to go. They fluctuate in value far less than the average stock and payout steady interest payments. Fixed-income investments like bonds can be a great way to generate extra cash to supplement Social Security and pay the bills.
When thinking about supplementing basic retirement income like Social Security, though, stocks shouldn't be left out of the equation. There are plenty of rock-solid businesses that pay out steady streams of cash to their shareholders, plus offer the added benefit of possible share price appreciation. Three that look particularly attractive for retirees are AbbVie (NYSE: ABBV), Phillips 66 (NYSE: PSX), and Store Capital (NYSE: STOR).
1. AbbVie: Prescriptions that pay you back
Global pharmaceutical giant AbbVie has had a rough go of it over the last couple of years. The stock is down some 40% from its high-water mark set in early 2018. Not exactly the kind of number that looks attractive to a typical retiree. Aging autoimmune disease treatment Humira losing some of its patent protection explains some of the price drop, as does AbbVie's proposed acquisition of Botox maker Allergan for $63 billion to diversify its sales base and boost cash flow.
The merger move has been a contentious one, to say the least. Some investors have panned it as too high a price, with others comfortable that the combined company will be able to repay debt all the while keeping the dividend spigot on. I'm on the side of the latter argument. The two maturing pharmaceutical businesses generate plenty of cash flow (a combined $19 billion in 2018) to pay down the debt financing, and AbbVie thinks an additional $2 billion in cost savings can eventually be found post-merger.
Of course, this is an article about income, so it's the dividend and how it will be affected that's important here. AbbVie's current free cash flow (basic profits after operating and capital expenditures are paid for) handily covers the current payout of $4.28 per share every year, good for a current yield of 5.7%. Allergan is also expected to immediately add to the bottom line once the merger is complete. The company also has a promising pipeline of new treatments that could help keep sales steadily rising in the years ahead. For investors looking for some extra spending money every year, AbbVie looks like a solid pick.
Image source: Getty Images.
2. Phillips 66: Paying at the pump is cash in the bank
The number of auto manufacturers lining up to challenge Tesla in the burgeoning electric-car race is astounding. There are only a handful of fully electric vehicle models to choose from now, but there could be dozens in just five years' time. And yet, even with vehicles making the turn to more battery use, gasoline will remain a mainstay for a long time.
That makes Phillips 66, spun off from ConocoPhillips back in 2012, worth a look. The energy-refining giant provides a wide range of distillate products, and fuel for cars is only part of a much broader product lineup. Fuel for commercial vehicles from trucks to airliners are a growth driver, as are exports overseas and the manufacture of plastics -- which it does through a joint venture with fellow retirement income stock Chevron. With a large number of outlets for its refined oil products, Phillips 66 has been a consistent winner since its independence less than a decade ago, in spite of several recent downturns for the energy industry.
Data by YCharts.
Besides the potential for steady stock growth, though, the dividend is where there is real value for retirees. Currently running at a 3.5% annualized yield, free cash flow is more than double the dividends paid, giving Phillips 66 plenty of room to keep doling out the payments while still investing in its refining operations. Electric vehicles won't be the end of gas products. Economic activity runs on energy companies, and this staple in the industry has the ability to provide steady cash payments for a long time.
3. Store Capital: Retail that's far from dead
These days, it seems everyone wants to shop online. The movement that Amazon.com sparked has spelled serious trouble for several brick-and-mortar retailers. But not all physical stores are created equal. Store Capital takes a different approach, focusing on retail services like restaurants and gyms rather than merchandise-based companies.
The beauty of Store Capital, though, is that it focuses on being a net-lease real estate investment trust (REIT). The property lease agreements it enters into require the tenant to cover building maintenance, property taxes, and insurance. That creates lots of upside for the property owner and far less downside. And as far as that goes, it is a best-in-class pick among this type of REIT. Store Capital's over 2,400 properties are 99.7% occupied, and the average length for a new lease signing during the second quarter of 2019 was 18 years. That provides a solid long-term business model, one that churns out plenty of cash for shareholders, as well as enough cash for Store Capital to keep making new deals and expanding its portfolio of real estate.
Data by YCharts.
Store Capital doesn't have the longest track record as it only went public in 2014. Since then though, funds from operations per share have increased over 200%, fueling a steadily rising dividend. The current yield is 3.8%, which includes a recent 6% increase put in place following the second quarter of 2019. Thus, Store Capital doesn't just provide a paycheck -- it has a history of doling out pay raises. When Social Security fails to keep up with living expenses, at least Store Capital will.
Meeting the retirement income challenge
Finding a good place to generate supplemental income in retirement can be a challenge, but stocks shouldn't be eliminated from the conversation. Diversifying the number of stocks invested in is key to mitigating risk, but AbbVie, Phillips 66, and Store Capital are a good place to get started in the conversation.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Nicholas Rossolillo and his clients own shares of AbbVie, Chevron, Phillips 66, STORE Capital, and Tesla. The Motley Fool owns shares of and recommends Amazon, STORE Capital, and Tesla. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aging autoimmune disease treatment Humira losing some of its patent protection explains some of the price drop, as does AbbVie's proposed acquisition of Botox maker Allergan for $63 billion to diversify its sales base and boost cash flow. Three that look particularly attractive for retirees are AbbVie (NYSE: ABBV), Phillips 66 (NYSE: PSX), and Store Capital (NYSE: STOR). AbbVie: Prescriptions that pay you back Global pharmaceutical giant AbbVie has had a rough go of it over the last couple of years. | The two maturing pharmaceutical businesses generate plenty of cash flow (a combined $19 billion in 2018) to pay down the debt financing, and AbbVie thinks an additional $2 billion in cost savings can eventually be found post-merger. AbbVie's current free cash flow (basic profits after operating and capital expenditures are paid for) handily covers the current payout of $4.28 per share every year, good for a current yield of 5.7%. Three that look particularly attractive for retirees are AbbVie (NYSE: ABBV), Phillips 66 (NYSE: PSX), and Store Capital (NYSE: STOR). | AbbVie's current free cash flow (basic profits after operating and capital expenditures are paid for) handily covers the current payout of $4.28 per share every year, good for a current yield of 5.7%. Diversifying the number of stocks invested in is key to mitigating risk, but AbbVie, Phillips 66, and Store Capital are a good place to get started in the conversation. Three that look particularly attractive for retirees are AbbVie (NYSE: ABBV), Phillips 66 (NYSE: PSX), and Store Capital (NYSE: STOR). | The two maturing pharmaceutical businesses generate plenty of cash flow (a combined $19 billion in 2018) to pay down the debt financing, and AbbVie thinks an additional $2 billion in cost savings can eventually be found post-merger. Three that look particularly attractive for retirees are AbbVie (NYSE: ABBV), Phillips 66 (NYSE: PSX), and Store Capital (NYSE: STOR). AbbVie: Prescriptions that pay you back Global pharmaceutical giant AbbVie has had a rough go of it over the last couple of years. |
24869.0 | 2019-10-03 00:00:00 UTC | 10 Insider Trading Stocks: What Execs and Directors Are Buying | ABBV | https://www.nasdaq.com/articles/10-insider-trading-stocks%3A-what-execs-and-directors-are-buying-2019-10-03 | nan | nan | When investors think of "insider trading," they might think of the kind of behavior to which ex-Rep. Chris Collins recently pleaded guilty. In that case, Collins used material, nonpublic information he gained from his seat on a biotechnology company's board to tip off his son and fiancée's father, who were able to sell shares before the info became public.
But some insider trading is legal. And in some cases, insider buying can signal to regular investors that something positive might be in the offing.
Insiders - directors, officers and shareholders that own more than 10% of at least one class of the company's stock - can (and do) buy and sell shares, sometimes frequently. They must abide by certain rules, such as not selling shares within six months of purchase. They also must disclose any transactions to the SEC - and these insider filings are available for public viewing, free of charge, on the SEC's EDGAR (Electronic Data Gathering, Analysis, and Retrieval) website.
No one understands the challenges and victories of a public company better than the officers and directors who run it. Thus, when knowledgeable insiders buy or sell the company's shares, savvy investors take note. Sometimes these trades are habitual and mean nothing - but sometimes, they can signal a change in sentiment. A sudden spurt of insider buying may signal new products coming to market or new customers signing up, or simply reflect an insider's conviction that the stock is undervalued.
Here are 10 stocks that have seen notable insider trading over the past few months. Investors shouldn't act solely on the basis of this recent insider buying - instead, it's just one factor to consider when evaluating these or any other stocks. But in each case, the buying stands out for its size or irregularity, which sometimes can be taken as a sign of insider optimism.
SEE ALSO: 13 Best Stocks to Buy for the Next Stock Market Correction
Dish Network
Market value: $16.2 billion
Notable recent insider purchases: $25.1 million
Dish Network (DISH, $32.93) is repositioning as a significant new player in the wireless telecom market thanks to the pending merger of T-Mobile US (TMUS) and Sprint (S). The Department of Justice requires T-Mobile and Sprint to sell parts of their business as a condition of the merger - Dish intends on being the acquirer.
Should the merger close - 17 states and the District of Columbia are suing to stop it, with a trial slated for December - Dish will own Sprint's pre-paid phone business and customers, including Boost Mobile, Virgin Mobile and the Sprint prepaid business. In addition, Dish will own some of Sprint's nationwide 800 MHz wireless spectrum and have complete access to T-Mobile's network for seven years. As a result, Dish customers will be able to move "seamlessly" from T-Mobile's nationwide network to its own new 5G broadband network.
In short, Dish would become the nation's fourth-largest wireless service provider.
The merger agreement couldn't come at a better time for Dish, which has been challenged by subscriber losses in its satellite TV business. During this year's June quarter, the company's pay-TV customer base declined by 31,000 subscribers. The subscriber loss contributed to a 7% decline in Dish's June-quarter revenues and a 28% drop in earnings per share (EPS).
Dish is paying up for this deal, too. It will pay $3.6 billion for wireless spectrum from the combined T-Mobile/Sprint, and $1.4 billion for Sprint's pre-paid phone business. Dish also must, as a condition of the sale, fully deploy the aforementioned nationwide 5G broadband network, covering at least 70% of the U.S., by June 2023. The company expects to invest at least $10 billion in building that network. Long-term debt already sits at $12.7 billion - which is 136% of Dish's equity - so the buildout will put an additional strain on Dish's already leveraged balance sheet.
Nonetheless, insider buying is inspiring confidence. Dish chairman Charles Ergen bought 500,005 shares of DISH stock worth roughly $15.7 million in early August. Later in the month, co-founder and Executive Vice President James Defranco added to his stake, spending about $9.4 million on 300,000 shares - his largest inside buy since at least Jan. 1, 2013, which is the start of available data on DISH's insider trading.
SEE ALSO: 20 Dividend Stocks to Fund 20 Years of Retirement
Peabody Energy
Market value: $1.5 billion
Notable recent insider purchases: $13.0 million
Peabody Energy (BTU, $14.51) is the world's largest private-sector pure-play coal producer. The company operates 23 mines in the U.S. and Australia and produced 12 million tons of metallurgical coal in 2018, making it the largest U.S.-listed metallurgical coal producer. Peabody also produced 19 million tons of thermal coal last year.
Metallurgical coal is used to make steel and is experiencing strong demand from China and India. The company's Australian mines and recently acquired Shoal Creek mine, located near a major shipping port, are well-positioned to serve the Asian market. Peabody is targeting production of 2.5 million tons of coal from the Shoal Creek mine this year. And the mine's cash flows imply that it will pay back its purchase price in less than two years.
Peabody's thermal coal production is purchased by utilities and burned to generate electricity. Peabody recently entered into a joint mining venture with Arch Coal (ARCH) that combines their Powder River Basin and Colorado assets into one mining complex. The joint venture is expected to create $820 million of pretax synergies and make their coal production more price-competitive with natural gas and other fuels.
Peabody has hiked its dividend three times in the past 12 months, for a total increase of 16%. The company also paid out a substantial supplemental dividend of $1.85 per share on March 20, representing a roughly 6.3% annual yield at the time. (BTU's regular dividend yields about 4% at current prices.) However, that hasn't quite made things right for investors; BTU shares have lost 52% of their value so far this year as lower demand and prices have crushed coal producers.
That said, Elliott Management, one of the largest activist investors in the world, bought roughly 710,000 shares of BTU, worth about $13 million, via several of its subsidiaries across several trades in August. Elliott, which hasn't sounded off about the recent purchases, now owns about 19.9 million shares of the stock - a roughly 18.6% stake.
SEE ALSO: Hedge Funds' 25 Favorite Blue-Chip Stocks
Ford
Market value: $34.4 billion
Notable recent insider purchases: $8.0 million
Ford (F, $8.61) is the second-largest North American automaker (13.8% share) and the world's sixth-largest automaker overall (6.2% share). The company produces Ford cars, trucks and SUVs, as well as luxury vehicles under its Lincoln brand. But its product of note is the F-150, which has been America's best-selling truck for 42 years in a row.
While Ford has struggled ever since the U.S. started its trade war with China in early 2018, it has recovered somewhat in 2019, up 13% year-to-date. But its results haven't given investors much to hope for. June-quarter revenues were flat year-over-year ($38.9 billion). EPS declined 85%, though mostly because of massive restructuring charges related to operations in Europe and South America. But even backing out those charges, adjusted earnings of 28 cents per share missed analyst expectations for 31 cents. Its 2019 earnings forecast disappointed, too.
Ford does have a few other things going on, however. It launched new models of its Ford Explorer and Lincoln Aviator during the June quarter and introduced the Ford Puma, a new crossover vehicle for the European market. The company also announced a partnership with Volkswagen (VWAGY) for a new autonomous-driving platform named Argo AI.
Deutsche Bank analyst Emmanual Rose thinks F shares have "considerable unappreciated potential" due to future cost benefits from the global restructuring, but "but investors may now wait for more visible earnings and cash flow traction, before giving the stock credit for it."
Ford Executive Chairman William Clay Ford didn't wait to make his insider trading move. He acquired 840,962 shares worth almost $8 million in early August, increasing his ownership stake to 1.1 million shares. That was his largest purchase, on a dollar basis, since buying up 800,000 shares for $10.9 million in March 2016.
SEE ALSO: 15 Dividend Kings for Decades of Dividend Growth
MPLX LP
Market value: $29.5 billion
Notable recent insider purchases: $3.2 million
MPLX LP (MPLX, $27.91) is a master limited partnership (MLP) that owns and operates energy infrastructure assets such as gas and oil pipelines, gathering systems, terminals and storage facilities. The company was formed by Marathon Petroleum (MPC) in 2012 to own, operate, develop and acquire these various types of assets.
MPLX owns more than 8,000 miles of pipeline extending across 17 states, mainly in the Midwest and Gulf Coast. MPLX's terminal facilities have 23.7 million barrels of storage capacity and its tank farms located near major refineries can hold 56 million barrels of oil.
The company closed on its $9 billion acquisition of Andeavor Logistics at the end of July. It plans to optimize its portfolio by selling non-strategic asset and using the proceeds to reduce debt and invest in higher-return projects. MPLX also has green-lit big investments in its Whistler natural gas pipeline and Wink-to-Webster crude oil pipeline - both located in the Permian Basin, located in the American Southwest.
MPLX has raised its distribution every quarter since it went public in October 2012, including a 6.4% bump last quarter to 65.75 cents per share. That's good for a yield of 9.6% at current prices. The company keeps backing it up with strong fundamental performance; in its June quarter, distributable cash flow (DCF, an important metric of MLP profitability) improved 6.7% to $741 million.
Heavy insider trading ensued in the weeks following the closed acquisition. MPLX Chairman and CEO Gary Heminger may have signaled his approval when he purchased 42,600 shares worth roughly $1.2 million in early August. Director Dan Sandman purchased 36,630 shares worth almost $1 million early on in the month, too, and Director Gary Peiffer bought 36,800 shares worth roughly $1 million across two buys in August.
* Distributions are similar to dividends but are treated as tax-deferred returns of capital and require different paperwork come tax time.
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Align Technologies
Market value: $14.4 billion
Notable recent insider purchases: $1.0 million
Align Technologies (ALGN, $179.75) owns the Invisalign system of invisible braces, used by more than 7.2 million patients (so far) to improve their smiles. Less known to consumers is the iTero intraoral scanner, which Align developed to help dentists create dental crowns, bridges and custom implants. Dentists have made more than 17.4 million dental scans using iTero.
ALGN shares were enjoying strong gains in 2019 up until late July, when it reported its results from the June quarter. While Invisalign shipments improved by 24.6% and EPS climbed 41%, those shipments came in below analyst estimates, and worse, it reduced its guidance for the September quarter. Align cited weaker demand in China and increased competition in doctor-directed and direct-to-customer sales channels as reasons for the lower guidance.
That sparked a 25% selloff in shares that has ALGN down 14% for the year-to-date. It also sent the analyst crowd into action. Stephens analyst Chris Cooley cut his price target to $200 per share, citing worries that a structural shift in the braces market was underway - one that favors direct-to-customer suppliers. Evercore analyst Elizabeth Anderson downgraded the stock to Market Perform (equivalent of Hold). Baird analyst Jeff Johnson pulled ALGN from his firm's top picks list.
The stock did enjoy a little insider buying in the wake of the selloff. Align CEO and President Joe Hogan showed his support by acquiring almost 5,000 shares worth about $1.0 million in early August. There was some insider selling, too. Director Joseph Lacob disposed of 40,000 ALGN shares worth roughly $7.2 million across August. However, insiders often partake in regular selling. Indeed, Lacob has sold shares several times each year since 2017 and hasn't recorded any purchases since at least 2013.
SEE ALSO: 20 More Best Stocks to Buy That You Haven't Heard Of
Ryman Hospitality Properties
Market value: $4.1 billion
Notable recent insider purchases: $1.1 million
Ryman Hospitality Properties (RHP, $80.25) is a real estate investment trust (REIT) that owns four upscale Gaylord-branded conference-center resorts, as well as interests in another Gaylord-branded resort and convention center. It also boasts entertainment assets including the Grand Ole Opry and its former home, the Ryman Auditorium.
JPMorgan Chase REIT analyst Joseph Greff turned cautious on the lodging sector in July because of high valuations and what he sees as the late stage of the current lodging cycle. He downgraded ratings on several lodging REITs, including RHP, to Underweight (equivalent of Sell) and lowered all of his price targets.
That's not a promising backdrop, but the REIT is at least posting solid results. For the June quarter, its funds from operations (FFO, an important REIT profitability metric) grew 9.6%, and the company upgraded its full-year guidance for revenues and FFO. That FFO funds a substantial 4.5% yield on a dividend that has been growing regularly for years.
Ryman Hospitality Chairman and CEO Colin Reed argues that Ryman's advance bookings and contract structures make it less volatile than other lodging REITs. He put his money where his mouth is in early August with some insider trading. Namely, he bought roughly 13,600 shares of RHP stock worth $1.1 million in early August - the largest purchase by a Ryman insider in a year.
SEE ALSO: 5 REITs You Can Buy and Hold for Decades
AbbVie
Market value: $106.6 billion
Notable recent insider purchases: $10.4 million
AbbVie (ABBV, $72.13) is a leading pharmaceutical company. It's best-known for blockbuster drug Humira, an arthritis treatment and the world's top-selling prescription drug. Humira accounted for $19.1 billion in 2018 -nearly 60% of AbbVie's sales that year - but faces increasing competition from lower-priced biosimilars already available in Europe and coming to U.S. markets in 2023.
The company is addressing this this challenge by expanding its product pipeline, as well as through mergers and acquisitions (M&A). In June, AbbVie announced its largest deal ever, agreeing to pay a 45% premium to acquire Allergan (AGN) for $63 billion, or $188 per share.
The Allergan acquisition makes AbbVie the market leader in the $8 billion Botox market and gives the company an ophthalmic drug product line that includes popular names such as Restasis. Allergan also should provide AbbVie with additional cash flow to fund research and asset purchases. The deal, scheduled to close in early 2020, is also expected to create $2 billion in annual pre-tax synergies and cost reductions for AbbVie over the next three years.
Interestingly, some analysts took a negative view of the acquisition, and ABBV hit a 52-week low, though it has since recovered, descended to even lower lows, and recovered yet again. Piper Jaffray analyst Christopher Raymond was blunt, quipping that "two turkeys don't make an eagle." Leerink Partners analyst Geoff Porges criticized AbbVie's pipeline soon after the deal announcement, but he actually upgraded the stock to Outperform (equivalent of Buy) on July 2, saying "While we are not necessarily fans of consolidation for its own sake, we see AbbVie bringing discipline and decisiveness to Allergan's portfolio."
Since the deal's announcement, ABBV has been flooded with inside buying. Chief Strategy Officer Henry Gosebruch bought 30,000 shares worth $2 million, Director Roxanne Austin purchased 76,500 shares worth $5.1 million; Jeffrey Stewart, SVP of U.S. Commercial Operations, bought 15,552 shares worth $1 million, Nicholas Donoghoe, SVP of Enterprise Innovcation, snapped up 7,525 shares worth almost $500,000, and Vice Chairman Laura Schumacher acquired 25,000 shares at $1.8 million.
SEE ALSO: 25 Stocks Every Retiree Should Own
Athenex
Market value: $957.7 million
Notable recent insider purchases: $13.2 million
Athenex (ATNX, $12.39) is a biopharmaceutical company developing new treatments for cancer. The company focuses on developing oral versions of existing cancer drugs that must currently be administered intravenously. Athenex has several drugs in its pipeline, including two in late-stage clinical studies.
Recently released results from the company's Phase III trial of oral paclitaxel showed the new drug produced a better overall response rate in breast cancer patients than intravenous paclitaxel. It also was associated with fewer treatment-related adverse events.
However, not all the study data was positive. Patients treated with oral Paclitaxel experienced a higher incidence of infection, neutropenia and gastrointestinal side effects than patients treated with the IV drug. These concerns triggered a 30% decline in ATNX's share price after the study results were published.
Athenex still plans to file a New Drug Application (NDA) with the U.S. FDA over the next few months. The company recently raised $100 million through a private equity placement that will fund infrastructure investments in manufacturing and marketing the new drug.
The company also announced second-quarter results in mid-August, which included a 92% jump in revenues and a narrower net loss of 44 cents per share (from 58 cents a year earlier). Athenex received a $20 million milestone payment from a development partner that will be recognized as revenues in the second half of 2019.
Billionaire hedge fund manager and biotech specialist Joe Edelman is a "beneficial owner" of ATNX, which means he owns at least 10% of at least one class of stock. Edelman has signaled his confidence over the past couple months with several spurts of heavy insider buying. His Perceptive Advisors hedge fund acquired more than 810,000 shares of ANTX stock worth $11.8 million of ATNX stock in early August, then another 100,000 worth $1.4 million in September, to bring his stake to 10.7 million shares, or 13.9%.
The important thing to remember with smaller biotechnology companies is that even keeping the lights on isn't a given until marketed products scale up. With $165.9 million of cash and investments on hand, Athenex believes it has sufficient funds to finance its operations through the first nine months of 2020. But that only takes investors up until roughly a year from now - more needs to happen for ATNX, which went public in July 2017, to be financially viable long-term.
SEE ALSO: All 30 Dow Stocks Ranked: The Analysts Weigh In
VTV Therapeutics
Market value: $83.7 million
Notable recent insider purchases: $7.3 million
VTV Therapeutics (VTVT, $1.43) is a tiny biotechnology company that develops orally administered treatments for diabetes, chronic pulmonary obstruction disorder, Alzheimer's disease and other chronic illnesses. The company has seven drug candidates in its pipeline in early-stage Phase I or Phase II clinical trials - in other words, it has no marketed products.
VTV's lead drug candidate, azeliragon, has shown promise as a treatment for early-stage Alzheimer's disease patients who also suffer from type 2 diabetes. The company anticipates publishing results from Phase II trials of azeliragon in late 2020. Another pipeline candidate, Simplici-T, has potential as a treatment for Type 1 diabetes. Simplici-T generated positive results in the first leg of its Phase II clinical trials; VTV plans to report second leg results in early 2020.
Billionaire biotech investor Ron Perelman is a beneficial owner of VTVT shares, via his MacAndrews & Forbes investment group. M&F has been steadily accumulating stock - not by making direct purchases, but by making use of an agreement empowering M&F to exercise options to purchase shares. In August, he accumulated 1.4 million shares worth roughly $2.3 million, then in September, he acquired another 3.2 million shares worth about $5 million. He now owns a roughly 80% stake across the company's publicly traded A shares and private B shares.
But this might be a stock best avoided. Shares have lost roughly 90% of their value since the company's August 2015 IPO, thanks in part to a failed Phase III trial for azeliragon in April 2018, which forced the company to end clinical trials for the drug at the time.
Meanwhile, VTV generated June-quarter revenues of $1.8 million, mainly from milestone payments, but spent $6.6 million on operations, resulting in a $2.9 million net loss. Cash dwindled from $5.0 million last quarter to less than $1.5 million. Thus, VTV will need to raise additional capital to fund ongoing clinical trials.
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USA Technologies
Market value: $413.4 million
Notable recent insider purchases: $15.8 million
USA Technologies (USATP, $24.35) is another stock with heavy insider trading that might be too risky for most buy-and-hold investors.
USA Technologies provides cashless payment processing and related services for small ticket, POS (Point-of-Sales) transactions. The company mainly serves clients in the beverage and food vending industries, though it plans to expand into additional segments, including commercial laundry, amusement arcades and kiosks. At present, USA Technologies has nearly 1 million POS connections to its services and customers across the U.S. Canada, Mexico and Australia.
USA Technologies believes it has penetrated just 7% of its addressable payment processing market, which the company estimates at 13 million to 15 million POS connections. Partnerships with Visa (V), Mastercard (MA), JPMorgan Chase (JPM) and Verizon (VZ), among others, present huge growth opportunities across its existing customer base.
Between 2011 and late 2018, USA Technologies grew sales 29% annually and transaction volume expanded at a 38% yearly rate. High recurring revenues (approximately 75% of revenues are recurring licensing and processing fees) contributed to double-digit sales growth.
Where things get messy is the company's inability to meet SEC filing deadlines. USA Technologies has not yet filed its 2018 annual report or 2019 quarterly reports. The company has faced multiple delisting warnings (and received several extensions) until it received notice Sept. 24 that it would be delisted from the Nasdaq on Sept. 26. It was. USA Technologies now trades "over-the-counter," which means it's no longer required to post regular financial updates - an important protection measure that keeps current and would-be investors informed.
Interestingly enough, beneficial owner Doug Braunstein, through his Hudson Executive Capital LP investment firm, continued to buy through the catastrophe. Hudson took a 12% stake in USA Technologies in May, at roughly $5.45 per share, calling the stock "undervalued and an attractive investment." He acquired more than 1 million shares worth $6.9 million in August. The company was granted an extension Sept. 9 with a deadline of Sept. 23. Braunstein still accumulated another 1.9 million shares worth $8.9 million between Sept. 23-26.
USA Technologies said it will try to regain compliance and its Nasdaq listing "as soon as practicable." But whether it will is unknown, making it exceedingly risky to follow in the footsteps of Braunstein's insider buying.
SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | SEE ALSO: 5 REITs You Can Buy and Hold for Decades AbbVie Market value: $106.6 billion Notable recent insider purchases: $10.4 million AbbVie (ABBV, $72.13) is a leading pharmaceutical company. Humira accounted for $19.1 billion in 2018 -nearly 60% of AbbVie's sales that year - but faces increasing competition from lower-priced biosimilars already available in Europe and coming to U.S. markets in 2023. In June, AbbVie announced its largest deal ever, agreeing to pay a 45% premium to acquire Allergan (AGN) for $63 billion, or $188 per share. | SEE ALSO: 5 REITs You Can Buy and Hold for Decades AbbVie Market value: $106.6 billion Notable recent insider purchases: $10.4 million AbbVie (ABBV, $72.13) is a leading pharmaceutical company. Humira accounted for $19.1 billion in 2018 -nearly 60% of AbbVie's sales that year - but faces increasing competition from lower-priced biosimilars already available in Europe and coming to U.S. markets in 2023. In June, AbbVie announced its largest deal ever, agreeing to pay a 45% premium to acquire Allergan (AGN) for $63 billion, or $188 per share. | SEE ALSO: 5 REITs You Can Buy and Hold for Decades AbbVie Market value: $106.6 billion Notable recent insider purchases: $10.4 million AbbVie (ABBV, $72.13) is a leading pharmaceutical company. Humira accounted for $19.1 billion in 2018 -nearly 60% of AbbVie's sales that year - but faces increasing competition from lower-priced biosimilars already available in Europe and coming to U.S. markets in 2023. In June, AbbVie announced its largest deal ever, agreeing to pay a 45% premium to acquire Allergan (AGN) for $63 billion, or $188 per share. | SEE ALSO: 5 REITs You Can Buy and Hold for Decades AbbVie Market value: $106.6 billion Notable recent insider purchases: $10.4 million AbbVie (ABBV, $72.13) is a leading pharmaceutical company. Humira accounted for $19.1 billion in 2018 -nearly 60% of AbbVie's sales that year - but faces increasing competition from lower-priced biosimilars already available in Europe and coming to U.S. markets in 2023. In June, AbbVie announced its largest deal ever, agreeing to pay a 45% premium to acquire Allergan (AGN) for $63 billion, or $188 per share. |
24870.0 | 2019-10-02 00:00:00 UTC | Forget Vertex Pharmaceuticals; CRISPR Therapeutics Is a Better Biotech Growth Stock | ABBV | https://www.nasdaq.com/articles/forget-vertex-pharmaceuticals-crispr-therapeutics-is-a-better-biotech-growth-stock-2019-10 | nan | nan | Both CRISPR Therapeutics (NASDAQ: CRSP) and Vertex Pharmaceuticals (NASDAQ: VRTX) are biotech stocks that have plenty of positive things going for them. In fact, these companies happen to be partners in an ongoing project to treat genetic diseases via gene-editing technologies. Yet despite this commonality, these stocks are radically different from one another, and each has its own unique upside potential.
While the much larger and better-established Vertex might seem like a strong pick, especially considering its long-term pipeline of preclinical and clinical treatments, I'd argue that its growth potential isn't as promising as that of CRISPR. Below, I'll explain exactly why, if I had to pick, I'd buy shares of CRISPR before Vertex.
IMAGE SOURCE: GETTY IMAGES.
A look at both companies
This isn't to say that Vertex is a bad investment by any means. While the $42.9 billion biotech giant might have fallen 12.4% over the past six months, whereas CRISPR has gone up by 19.5% during that same period, the long-term prognosis for Vertex remains strong. Vertex's bread and butter come from the sales of its cystic fibrosis drugs Orkambi, Kalydeco, and Symdeko. The three drugs target different groups of cystic fibrosis patients but remain fairly similar. At the same time, the company has made progress in its plans to diversify. Earlier this year, it announced it would cough up $950 million to buy out Semma Therapeutics, acquiring a highly promising type 1 diabetes treatment in the process.
While the long-term picture looks good for Vertex, CRISPR Therapeutics has its own major upsides. With a market cap of just $2.32 billion, CRISPR is only a fraction of Vertex's size and has much more room to grow. Unlike Vertex, which already has major treatments under its belt, CRISPR is still at the preclinical and clinical stages for most of its flagship treatments. Despite this, investors and analysts are so enthusiastic about the company's chances in the promising gene-editing market that they've pushed its market cap up to the $2.3 billion mark. This is well above all of its other rivals in the space such as Editas Medicine (NASDAQ: EDIT) and Intellia Therapeutics (NASDAQ: NTLA), which have market caps of $1.1 billion and $652.5 million, respectively.
The gene-editing market
Much of the reason I consider CRISPR a superior growth stock comes down to the specifics of the gene-editing market. While it might sound like science fiction that we can edit our genes through drugs, CRISPR has done exactly that with the advent of its iconic CRISPR Cas9 gene-editing technology.
The global gene-editing market was initially estimated at just $2.25 billion back in 2015. Since then, the market has quickly grown to $3.7 billion in 2019, and current estimates predict this figure will jump to $9.66 billion by 2025. In comparison, the cystic fibrosis market, which is Vertex's primary source of revenue, is estimated to reach $13.9 billion by 2025.
Although this seems better, investors need to consider that the cystic fibrosis arena is already crowded with a number of pharmaceutical competitors. Besides Vertex, the $110 billion pharma giant AbbVie (NYSE: ABBV) is also a player (although some of its recent clinical trial data has been mediocre in comparison to Vertex's results), and Gilead Sciences (NASDAQ: GILD) has a cystic fibrosis drug, Cayston, that Vertex has to compete with as well.
In comparison, CRISPR has fewer competitors in the gene-editing market, with most analysts considering Editas to be its primary rival despite a market cap just half that of CRISPR. I would argue that being the big fish in a somewhat smaller pond is preferable for a growth stock.
CRISPR's potential solutions
CRISPR Therapeutics has a number of potential breakthrough solutions on the horizon. Focusing on genetic disorders, its flagship treatment called CTX001 targets patients with sickle cell disease and thalassemia. At the moment, there are few convenient treatment options for patients with either disease. Researchers are studying the potential of bone marrow transplants, but should CTX001 receive FDA approval, it could become the drug of choice for the majority of sickle cell patients.
At the same time, CRISPR is also developing a number of cancer drugs. While other pharma companies such as Novartis (NYSE: NVS) and Gilead have their own cancer treatments -- all of them CAR-T therapies, to be specific -- these are quite slow and expensive for the ordinary person. CRISPR's technology could potentially solve these problems, as the typically arduous process of training a patient's own system to fight cancer cells can be made much quicker through gene-editing technology. In this sense, despite the competition, CRISPR's expertise in gene editing could easily put it above its rival drugs in cost, efficiency, and expediency.
Even if these two breakthrough areas aren't as successful as initially expected, the main strength behind CRISPR Therapeutics is its versatility. Even if its sickle cell or cancer drugs turn out to be unexpected failures, it can quickly shift toward another genetic disorder, of which there are many to choose from.
Which biotech has better growth?
Both Vertex Pharmaceuticals and CRISPR Therapeutics are solid biotech investments. The former is a strong, long-term pick with an initial lead on the cystic fibrosis market despite plenty of competition. The latter is a much smaller company that's also currently a leader in its area of expertise. Although gene editing is a smaller market at the moment, it comprises fewer competitors for CRISPR to deal with.
However, if I had to say which stock is a superior growth investment, I'd lean toward CRISPR Therapeutics. The potential of the gene-editing space is so significant, with so many potential genetic diseases that can be treated this way, that a company like CRISPR is likely to find a breakthrough sooner or later. With its market cap sitting at just $2.3 billion as opposed to Vertex's $42.9 billion, it also has much more room for exponential growth.
10 stocks we like better than CRISPR Therapeutics
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Mark Prvulovic has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Editas Medicine and Gilead Sciences. The Motley Fool owns shares of CRISPR Therapeutics. The Motley Fool recommends Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Besides Vertex, the $110 billion pharma giant AbbVie (NYSE: ABBV) is also a player (although some of its recent clinical trial data has been mediocre in comparison to Vertex's results), and Gilead Sciences (NASDAQ: GILD) has a cystic fibrosis drug, Cayston, that Vertex has to compete with as well. While the much larger and better-established Vertex might seem like a strong pick, especially considering its long-term pipeline of preclinical and clinical treatments, I'd argue that its growth potential isn't as promising as that of CRISPR. Earlier this year, it announced it would cough up $950 million to buy out Semma Therapeutics, acquiring a highly promising type 1 diabetes treatment in the process. | Besides Vertex, the $110 billion pharma giant AbbVie (NYSE: ABBV) is also a player (although some of its recent clinical trial data has been mediocre in comparison to Vertex's results), and Gilead Sciences (NASDAQ: GILD) has a cystic fibrosis drug, Cayston, that Vertex has to compete with as well. CRISPR's potential solutions CRISPR Therapeutics has a number of potential breakthrough solutions on the horizon. Focusing on genetic disorders, its flagship treatment called CTX001 targets patients with sickle cell disease and thalassemia. | Besides Vertex, the $110 billion pharma giant AbbVie (NYSE: ABBV) is also a player (although some of its recent clinical trial data has been mediocre in comparison to Vertex's results), and Gilead Sciences (NASDAQ: GILD) has a cystic fibrosis drug, Cayston, that Vertex has to compete with as well. The gene-editing market Much of the reason I consider CRISPR a superior growth stock comes down to the specifics of the gene-editing market. In comparison, CRISPR has fewer competitors in the gene-editing market, with most analysts considering Editas to be its primary rival despite a market cap just half that of CRISPR. | Besides Vertex, the $110 billion pharma giant AbbVie (NYSE: ABBV) is also a player (although some of its recent clinical trial data has been mediocre in comparison to Vertex's results), and Gilead Sciences (NASDAQ: GILD) has a cystic fibrosis drug, Cayston, that Vertex has to compete with as well. Focusing on genetic disorders, its flagship treatment called CTX001 targets patients with sickle cell disease and thalassemia. The former is a strong, long-term pick with an initial lead on the cystic fibrosis market despite plenty of competition. |
24871.0 | 2019-10-01 00:00:00 UTC | 10 Medical Marijuana Stocks to Cure Your Portfolio | ABBV | https://www.nasdaq.com/articles/10-medical-marijuana-stocks-to-cure-your-portfolio-2019-10-01 | nan | nan | [Editor’s note: “10 Medical Marijuana Stocks to Cure Your Portfolio” was previously published in August 2019. It has since been updated to include the most relevant information available.]
Invariably, no other investment class generates as much interest and controversy as marijuana stocks. Within a generation, toward legalization shifted dramatically from strongly opposed to mostly supportive. This is largely due to demographics, as the more progressive millennials replace older Americans in positions of influence.
Additionally, marijuana stocks represent a viable economic channel that can help bridge the gap for many states’ financial issues. For instance, green-friendly enjoys significant tax revenues from its botanical industry. I don’t see this trend changing for the worse anytime soon, as awareness and popularity is only increasing.
Of course, cannabis isn’t without its controversies. Primarily, the federal government classifies marijuana as a Schedule I drug, putting it on par with hardcore narcotics like cocaine. Thus, no matter how liberal some states become toward their agricultural ambitions, the specter of federal oversight and crackdowns keeps many entrepreneurs and businesses away.
However, we have one critical exception to the rule: marijuana stocks that specialize in medicinal and therapeutic benefits. For one thing, medical cannabis mitigates the stereotypical image of potheads and general no-gooders. Plus, people experiment with pharmaceuticals all the time. Why not allow these same patients the choice for natural alternatives?
More critically for marijuana stocks, the medicinal aspect offers the best chance for international acceptance. Currently, very few jurisdictions allow recreational weed. Given the abundance of traditional and conservative nations, a green world is unlikely. But as Thailand and South Korea demonstrated, medical cannabis is a much .
As a result, you want exposure not just to marijuana stocks, but also to the therapeutic element. Here are 10 names to consider:
AbbVie (ABBV)
Source: Shutterstock
Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline.
We’re talking mainstream solutions for common ailments and diseases like arthritis and plaque psoriasis.
Still, AbbVie maintains some botanical credibility with its Marinol therapy. A synthetic cannabis-based drug, Marinol addresses chemotherapy-related side effects, such as vomiting or nausea. In addition, it helps restore appetite among AIDS patients.
Of course, you should note that Marinol isn’t among AbbVie’s top-selling products. Therefore, you’re only getting limited exposure to cannabis with ABBV stock. But based on the extreme volatility of marijuana stocks, that isn’t such a bad gig.
Emerald Health Therapeutics (EMHTF)
Source: Shutterstock
Not that I would know, but growing cannabis allegedly isn’t rocket science.
With the right conditions, the right equipment and a reasonable car, anyone can grow their stash. But cultivating the plant so that it addresses specific ailments and symptoms? That takes real effort, which is where Emerald Health Therapeutics (OTCMKTS:) comes in.
Rather than just pumping out the green stuff, Emerald deliberately seeks out the strains most effective in addressing patients’ needs. The company provides a wide of strains, which range in weight, tetrahydrocannabinol (THC) content, and cannabidiol (CBD) strength. Their impressive portfolio should lift EMHTF stock over the long run, as interest in CBD products accelerates.
It’s important to be careful with pot stocks, though. On a year-to-date basis, EMHTF stock is down nearly 58%. While all cannabis stocks suffer volatility risk, Emerald’s concentration on medicinal weed should help mitigate downside pressure.
Aurora Cannabis (ACB)
Source: Shutterstock
I’ve spent a lot of time discussing Aurora Cannabis (NYSE:), and I don’t mean to keep double-dipping into this company. Still, I keep going back for a reason: ACB stock is an excellent play within the medical-marijuana market.
A key factor in my bullishness for Aurora is its management team. In my view, they’re making smart decisions through their acquisitive strategy.
Rather than merely focusing on outright capacity, they’re looking out over the horizon. Aurora’s buyout of Whistler Medical Marijuana gave the organization significant leverage in medical cannabis due to Whistler’s extensive .
Furthermore, ACB stock is a strong performer. Since the January opener, shares have skyrocketed roughly 70% before plummeting. It’s down 20% this year. The inevitable correction should be only temporary. Among marijuana stocks, Aurora is exceptionally well-positioned for sustainable growth.
Cronos Group (CRON)
Source: Shutterstock
One of the top names among major marijuana stocks, Cronos Group (NASDAQ:) naturally attracts a lot of attention. This time, though, they’re attracting the wrong kind.
Prior to its earnings report for the second quarter, I worried about the company’s .
Hit or exceed it, and management can stave off criticism, but speculators looking for a discounted price may want to put CRON stock back on their radar. After concerns about vaping safety hit the news Cronos has shed All of this years gains and more, down nearly 20% YTD.
Plus, Cronos has international legitimacy among medicinally focused cannabis stocks. Featuring partnerships and joint ventures across five continents, the company is ahead of the game.
CannTrust (CTST)
In business, even the green kind, you can’t get ahead of yourself. So while lucrative opportunities exist in the international sector, CannTrust (NYSE:) remains firmly committed to winning its native Canadian market.
At the same time, CannTrust can’t afford to ignore the rest of the world. Although Canada becoming the first to legalize recreational weed generated headlines, our northern neighbors alone can’t support this burgeoning industry.
Therefore, management has focused on the growth and capacity narrative to compete effectively at home and, later, abroad.
To achieve the second leg of this journey, CannTrust teamed up with Denmark’s to distribute medical cannabis products in that country.
It also inked a partnership with an Australian firm for similar distribution arrangements. While it’s not the most common name among marijuana stocks, CTST stock provides a risky, but viable, opportunity.
Innovative Industrial Properties (IIPR)
Most marijuana stocks focus on the industry’s front face; namely, production. As I mentioned earlier, marijuana isn’t that difficult to grow. So long as you have the green light legally, the physical barrier to entry is relatively short.
But the real challenge, though, is finding a consistent source of financing. This is where Innovative Industrial Properties (NYSE:) lends a helping hand.
Despite momentum toward legalization, several financial institutions shy away from cannabis ventures.
Innovative Industrial plugs the gap, offering critical capital through its leaseback business model.
Thanks to the company’s tremendous utility, IIPR stock has lit up the markets. Shares are currently up a little more than 100% YTD. Technically, IIPR may have gotten a bit overheated. That said, I wouldn’t get too greedy looking for the perfect entry point. Innovative Industrial levers a proven business model that is only increasing in relevancy.
Terra Tech (TRTC)
Everyone recognizes cannabis stocks for two things: their incredible potential and their equally incredible volatility. Unfortunately, stakeholders of medical-cannabis producer Terra Tech (OTCMKTS:) find themselves in the latter category.
So far this year, TRTC stock is down around 50%.
And the bad news doesn’t end there. Unlike many other marijuana stocks, Terra Tech has had trouble generating top-line growth.
In its most recent earnings report for the second quarter, 2019 the. After two consecutive down quarters, this could signal that TRTC is redeemable.
So why take a bet on TRTC stock? First, its vertically integrated organization may facilitate significant efficiencies as political momentum increases. Second, I dig their leadership team. The head execs are experts in finance, which should prove beneficial in properly navigating TRTC across choppy waters.
Charlotte’s Web (CWBHF)
Source: Shutterstock
When most people look at Charlotte’s Web (OTCMKTS:), they’re thinking that they missed the boat. After all, CWBHF stock jumped 78% at the beginning of this year.
From the opening price this year, however, Charlotte’s Web shares are down 17%.
As much as I love marijuana stocks, I’m fairly certain that this cannabis firm is due for a further pullback. But once that occurs, I wouldn’t waste too much time squabbling over the granularity.
Instead, I’d consider what our own Matt McCall had to say. Thanks to the popularity of CBD, Charlotte’s Web’s CBD-based products could be distributed across channels.
Unquestionably, such an event would launch CWBHF stock into the stratosphere. Moreover, because most CBD products contain no trace of THC, they don’t fall under severe federal guidelines. Therefore, don’t get too greedy looking for an ideal price point when CWBHF corrects.
Cannabis Science (CBIS)
On paper, Cannabis Science (OTCMKTS:) represents the next evolution among cannabis stocks: pharmaceutical firms that devote their time and research exclusively toward medical marijuana.
Not only that, this is a much-needed development that could lift CBIS stock, as well as the entire botanical industry.
For decades, people unquestionably trusted the mainstream healthcare and pharmaceutical network.
However, the rapidly escalating has proven that well-intentioned medical professionals can lever a tragic impact. One of the underlying causes of this crisis is the addictiveness of prescribed medicines.
Organizations like Cannabis Science can potentially mitigate this situation with naturally sourced therapies free of psychoactive side-effects. That’s the allure for CBIS stock. However, shares trade for less than .012 cents a pop, so this is only for the risk-tolerant.
GW Pharmaceuticals (GWPRF)
Source: Shutterstock
On a surface level, GW Pharmaceuticals (OTCMKTS:) brings a lot of positives to the table. As pioneers among medicinally-concentrated marijuana stocks, they lever substantial credibility.
Their drug for addressing symptoms associated with multiple sclerosis achieved better-than-expected results. This only encourages other companies to pursue cannabis-based therapies for many other diseases.
That’s the good news. The not-so-pleasant side of the coin, though, is market performance. While no one mistakes cannabis stocks as stable investment platforms, GWPRF stock is rough for even hardened botanical veterans.
In December of last year, shares fell off a cliff before rebounding back toward low-earth orbit. Since then, it has added 69% so it’s a really volatile stock.
So is GWPRF stock worth a look now? Although I like how the company has stabilized, I don’t care for its low volume. But GW Pharmaceuticals is a penny stock with underappreciated talents. If you have the nerve and the patience, it’s worth your consideration.
As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. | Here are 10 names to consider: AbbVie (ABBV) Source: Shutterstock Whenever you have a discussion about cannabis stocks, chances are, AbbVie (NYSE:) isn’t the first name you think about. One of the healthcare sector’s blue chips, ABBV stock has soared on its vast therapeutic pipeline. Still, AbbVie maintains some botanical credibility with its Marinol therapy. |
24872.0 | 2019-10-01 00:00:00 UTC | 4 Healthcare Stocks to Buy Now | ABBV | https://www.nasdaq.com/articles/4-healthcare-stocks-to-buy-now-2019-10-01 | nan | nan | U.S. equities are pushing higher this week thanks to — you guessed it — hopes of a U.S.-China trade deal. The White House has somewhat denied rumors from Friday that President Donald Trump was considering delisting Chinese companies from American stock changes.
JPMorgan analyst also raised the firm’s price target on Apple (NASDAQ:) to $265. Because of its massive market capitalization, this move is also sending equities higher.
But it’s the healthcare sector that is catching my eye, with a number of stocks in the area pushing higher on what looks like chatter that Hillary Clinton could — potentially pushing out Senator Elizabeth Warren from front-runner status. Warren is considered a big risk factor for the healthcare industry, at least as its currently structured.
Here are four stocks to consider.
Healthcare Stocks to Buy: Merck (MRK)
Merck (NYSE:) shares are pushing back up and getting close to the company’s 50-day moving average. It looks like MRK stock might make another challenge of prior highs near the $87 level after making another quick test of its 200-day moving average. The company will next report results on Oct. 29 before the bell. Analysts are looking for earnings of $1.23 per share on revenues of $11.6 billion.
AbbVie (ABBV)
AbbVie (NYSE:) shares are on the mend, climbing back up and over its 200-day moving average for the first time since August 2018. Citigroup analyst Andrew Baum recently upgraded the stock to “buy” with a $90 price target. This upgrade is based on expectations that AbbVie will extract significant shareholder value from its purchase of Allergan.
The company will next report results on Nov. 1 before the bell. Analysts are looking for earnings of $2.29 per share on revenues of $8.4 billion.
Abbott Laboratories (ABT)
Abbott Laboratories (NYSE:) shares look ready for another attempt at the $90 level in a continuation of the smooth, steady uptrend the stock has enjoyed since late 2016. The company will next report results on Oct. 16 before the bell. Analysts are looking for earnings of 84 cents per share on revenues of $8.1 billion. When the company last reported July 17, earnings of 82 cents per share beat estimates by 2 cents on a 2.7% rise in revenues.
Bristol-Myers Squibb (BMY)
Shares of Bristol-Myers Squibb (NYSE:) are extending their recent charge above their 200-day moving average to return to levels not seen since March. The company will next report results on Oct. 31 before the bell. Analysts are looking for earnings of $1.06 per share on revenues of $5.9 billion. When the company last reported on July 25, earnings of $1.18 beat estimates by 12 cents on a 10% rise in revenues.
As of this writing, William Roth did not hold any of the aforementioned securities.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | This upgrade is based on expectations that AbbVie will extract significant shareholder value from its purchase of Allergan. AbbVie (ABBV) AbbVie (NYSE:) shares are on the mend, climbing back up and over its 200-day moving average for the first time since August 2018. The White House has somewhat denied rumors from Friday that President Donald Trump was considering delisting Chinese companies from American stock changes. | AbbVie (ABBV) AbbVie (NYSE:) shares are on the mend, climbing back up and over its 200-day moving average for the first time since August 2018. This upgrade is based on expectations that AbbVie will extract significant shareholder value from its purchase of Allergan. Healthcare Stocks to Buy: Merck (MRK) Merck (NYSE:) shares are pushing back up and getting close to the company’s 50-day moving average. | AbbVie (ABBV) AbbVie (NYSE:) shares are on the mend, climbing back up and over its 200-day moving average for the first time since August 2018. This upgrade is based on expectations that AbbVie will extract significant shareholder value from its purchase of Allergan. Healthcare Stocks to Buy: Merck (MRK) Merck (NYSE:) shares are pushing back up and getting close to the company’s 50-day moving average. | AbbVie (ABBV) AbbVie (NYSE:) shares are on the mend, climbing back up and over its 200-day moving average for the first time since August 2018. This upgrade is based on expectations that AbbVie will extract significant shareholder value from its purchase of Allergan. Here are four stocks to consider. |
24873.0 | 2019-10-01 00:00:00 UTC | 3 Big Stock Charts for Tuesday: AbbVie, S&P Global and FleetCor Technologies | ABBV | https://www.nasdaq.com/articles/3-big-stock-charts-for-tuesday%3A-abbvie-sp-global-and-fleetcor-technologies-2019-10-01 | nan | nan | The market kicked off the new trading week in a better mood than it ended the old though, although Monday’s 0.5% gain for the S&P 500 wasn’t exactly game-changing. Volume was light, and we’re still within reach of a key technical breakdown.
Source: Shutterstock
Apple (NASDAQ:) did more than its fair share of heavy lifting, gaining 2.3% after JPMorgan suggested demand for its newest iPhone was stronger than had been previously anticipated. Smaller Bed Bath & Beyond (NASDAQ:) logged a much bigger and better day, however, rallying nearly 8% after Wedbush upgraded the stock on the possibility that it would sell certain assets.
Holding the market back more than any other name was Visa (NYSE:). Shares of the credit card middleman slumped a little more than 1%, rekindling a wave of profit-taking that got going early last month.
As for names worth a trading-minded look headed into Tuesday’s session, though, take a look at the stock charts of AbbVie (NYSE:), S&P Global (NYSE:) and FleetCor Technologies (NYSE:). They’re each working their way towards something more explosive.
S&P Global (SPGI)
S&P Global was quietly one of this year’s top performers through early September. But, once the sheer weight of those gains started to bear down on the rally’s underpinnings, it became clear how fragile the advance had become. Friday’s tumble was something of a death blow.
A closer inspection of both stock charts of S&P Global, however, makes clear that this selloff and technical breakdown was put into motion well before this week. It goes back to a start date of September 9.
• Sept. 9 is the day we got our first “outside day” reversal. Highlighted on the daily chart, S&P Global shares opened above the previous day’s high only to close below the previous day’s low. The sweeping change of heart often indicates a key pivot in sentiment. We saw another bearish outside day on Friday, which is also highlighted.
• Friday’s stumble also pulled SPGI stock below the rising support line plotted in yellow that had kept the uptrend in motion for months.
• Fanning the newly formed bearish flames is the heavy volume that’s accompanied the breakdown over the course of the past couple of trading days. The nudge may have drawn several would-be sellers out of the woodwork.
FleetCor Technologies (FLT)
With nothing more than a passing glance, it would be easy to not even notice the shape of the FleetCor Technologies chart of late. Like most other stocks, it has been up and down, and not making any net progress.
A longer look at FLT stock, however, makes clear that things are changing for the worst. Although only gradually, the bears have been chipping away at this year’s uptrend and are quietly on the verge of tipping the scales all the way over to the bearish side. The good news is, the make-or-break line is crystal clear.
• The grey 100-day moving average line is that line in the sand, so to speak. The last couple of times it was kissed earlier this year, the FleetCor rally sprang back to life.
• It’s subtle, though very telling, how on the daily chart the red, bearish volume bars have been gradually growing since July. It’s a hint that the bears are already planning on dishing out a setback.
• Zooming out to the weekly chart, we can see FleetCor Technologies is no stranger to arcing rollovers once they slip into an overbought situation.
AbbVie (ABBV)
The last time AbbVie was under the trading microscope , it was in a downtrend, but finding support at a couple of different well-established floors. The previous day’s volume surge suggested the matter was going to come to a head. It did, albeit for the worst. A couple of days later ABBV was crushed.
That setback and the follow-up stumble in August, however, may have ultimately served as a capitulation that will eventually be determined to be “the” bottom. There’s just one more major hurdle to clear before we can know for sure if the turnaround was built to last.
• One has to zoom out to the weekly chart to fully appreciate it, but the July/August meltdown perfectly tagged the support line that had previously connected the two key lows from 2018. That line is plotted as a red, dashed line.
• The trading range that’s been guiding ABBV stock lower since early last year is still intact, although AbbVie is testing that upper boundary at this time. The white 200-day moving average line is also coming into play.
• The September rally has taken shape on clearly bullish volume, though no more volume than the selling volume seen in July.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, , or follow him on Twitter, at @jbrumley.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | • The trading range that’s been guiding ABBV stock lower since early last year is still intact, although AbbVie is testing that upper boundary at this time. As for names worth a trading-minded look headed into Tuesday’s session, though, take a look at the stock charts of AbbVie (NYSE:), S&P Global (NYSE:) and FleetCor Technologies (NYSE:). AbbVie (ABBV) The last time AbbVie was under the trading microscope , it was in a downtrend, but finding support at a couple of different well-established floors. | As for names worth a trading-minded look headed into Tuesday’s session, though, take a look at the stock charts of AbbVie (NYSE:), S&P Global (NYSE:) and FleetCor Technologies (NYSE:). AbbVie (ABBV) The last time AbbVie was under the trading microscope , it was in a downtrend, but finding support at a couple of different well-established floors. A couple of days later ABBV was crushed. | As for names worth a trading-minded look headed into Tuesday’s session, though, take a look at the stock charts of AbbVie (NYSE:), S&P Global (NYSE:) and FleetCor Technologies (NYSE:). AbbVie (ABBV) The last time AbbVie was under the trading microscope , it was in a downtrend, but finding support at a couple of different well-established floors. A couple of days later ABBV was crushed. | As for names worth a trading-minded look headed into Tuesday’s session, though, take a look at the stock charts of AbbVie (NYSE:), S&P Global (NYSE:) and FleetCor Technologies (NYSE:). AbbVie (ABBV) The last time AbbVie was under the trading microscope , it was in a downtrend, but finding support at a couple of different well-established floors. A couple of days later ABBV was crushed. |
24874.0 | 2019-10-01 00:00:00 UTC | 2 Reasons Why 1 Top Analyst Thinks AbbVie Could Soar Nearly 20% | ABBV | https://www.nasdaq.com/articles/2-reasons-why-1-top-analyst-thinks-abbvie-could-soar-nearly-20-2019-10-01 | nan | nan | Several Wall Street analysts expressed skepticism when AbbVie (NYSE: ABBV) announced its planned $63 billion acquisition of Allergan (NYSE: AGN) in June. This negativity contributed to an absolutely dismal performance for AbbVie so far in 2019, with its shares dropping more than 30% at one point.
But at least one analyst now thinks that AbbVie looks like a great pharma stock to buy. Citigroup's Andrew Baum recently upgraded AbbVie from a neutral rating to a buy rating and set a one-year price target that's nearly 20% above AbbVie's current share price. Baum had two primary reasons for his optimism about AbbVie's prospects.
Image source: Getty Images.
1. The Allergan acquisition isn't such a bad idea after all
Baum wrote to investors that Citi believes "AbbVie will extract significant shareholder value from Allergan's franchises." Those franchises include Botox, Juvederm, and Vraylar. Allergan reported solid sales growth for each of these products in the second quarter.
Botox is the crown jewel in Allergan's lineup. The drug is used for facial aesthetics and for several therapeutic purposes, including the treatment of bladder dysfunction, cervical dystonia (a disorder where muscles contract involuntarily), and chronic migraine. However, Allergan's biggest rising star is antipsychotic drug Vraylar, which appears on track to be the company's next blockbuster.
AbbVie expects that its acquisition of Allergan will boost its annual revenue growth from 7% to around 10% through 2023, putting it on track to claim one of the strongest revenue growth rates among big pharma companies. Buying Allergan also helps cushion the blow from declining sales for AbbVie's top-selling drug, Humira, which already faces biosimilar competition in Europe and will compete against biosimilars in the U.S. beginning in 2023.
2. Rinvoq and Skyrizi aren't getting enough respect
Two other core components to AbbVie's strategy to deal with its Humira issue are the company's newly approved immunology drugs, Rinvoq and Skyrizi. Baum doesn't think that investors are giving due respect to the potential for these two drugs.
The FDA approved Skyrizi in April for treating plaque psoriasis. AbbVie followed up in August by winning FDA approval for Rinvoq as a treatment for rheumatoid arthritis. Both drugs are also being evaluated in clinical studies for other indications, including atopic dermatitis, Crohn's disease, psoriatic arthritis, and ulcerative colitis.
AbbVie thinks that Skyrizi could pull in peak annual sales of around $5 billion. It projects that Rinvoq could achieve peak annual sales of $6.5 billion. If the company's estimates are in the ballpark of what the two drugs can actually make, AbbVie should be able to largely offset the expected sales declines for Humira.
Is Citi's optimism realistic?
My view is that Citi's upgrade of AbbVie and the optimistic price target make sense. I agree with Andrew Baum that AbbVie should be able to realize significant benefits from its acquisition of Allergan. And I think he's right that the market isn't fully appreciating the potential for Rinvoq and Skyrizi.
It's true that megadeals don't always work out very well for big pharma stocks. It's also true that AbbVie's history of acquisitions doesn't inspire a tremendous level of confidence. But AbbVie didn't overpay for Allergan, in my opinion. Like Baum, I expect the deal will provide value for shareholders over the near term and the long term.
Baum isn't the only observer to think highly of the prospects for Rinvoq and Skyrizi. Pharmaceutical market researcher EvaluatePharma ranked the drugs in second and third places, respectively, among the top new drug launches of 2019.
I understand why some investors are worried about the challenges for Humira. I get that many don't like the Allergan deal. But the reality is that this stock should be valued more highly than it is right now.
AbbVie currently trades at less than eight times expected earnings. Its dividend yields north of 5.7%. The company has solid growth prospects with Imbruvica and Venclexta and great new potential blockbusters with Rinvoq and Skyrizi, in addition to what Allergan brings to the table.
Could AbbVie's shares jump close to 20% over the next year as Citi projects? I think so.
10 stocks we like better than AbbVie
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Keith Speights owns shares of AbbVie. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Several Wall Street analysts expressed skepticism when AbbVie (NYSE: ABBV) announced its planned $63 billion acquisition of Allergan (NYSE: AGN) in June. This negativity contributed to an absolutely dismal performance for AbbVie so far in 2019, with its shares dropping more than 30% at one point. But at least one analyst now thinks that AbbVie looks like a great pharma stock to buy. | But at least one analyst now thinks that AbbVie looks like a great pharma stock to buy. The Allergan acquisition isn't such a bad idea after all Baum wrote to investors that Citi believes "AbbVie will extract significant shareholder value from Allergan's franchises." AbbVie expects that its acquisition of Allergan will boost its annual revenue growth from 7% to around 10% through 2023, putting it on track to claim one of the strongest revenue growth rates among big pharma companies. | Citigroup's Andrew Baum recently upgraded AbbVie from a neutral rating to a buy rating and set a one-year price target that's nearly 20% above AbbVie's current share price. The Allergan acquisition isn't such a bad idea after all Baum wrote to investors that Citi believes "AbbVie will extract significant shareholder value from Allergan's franchises." Rinvoq and Skyrizi aren't getting enough respect Two other core components to AbbVie's strategy to deal with its Humira issue are the company's newly approved immunology drugs, Rinvoq and Skyrizi. | The Allergan acquisition isn't such a bad idea after all Baum wrote to investors that Citi believes "AbbVie will extract significant shareholder value from Allergan's franchises." Rinvoq and Skyrizi aren't getting enough respect Two other core components to AbbVie's strategy to deal with its Humira issue are the company's newly approved immunology drugs, Rinvoq and Skyrizi. Several Wall Street analysts expressed skepticism when AbbVie (NYSE: ABBV) announced its planned $63 billion acquisition of Allergan (NYSE: AGN) in June. |
24875.0 | 2019-09-30 00:00:00 UTC | ABBV: Insiders vs. Shorts | ABBV | https://www.nasdaq.com/articles/abbv%3A-insiders-vs.-shorts-2019-09-30 | nan | nan | The most recent short interest data was recently released for the 04/15/2019 settlement date, and AbbVie Inc (Symbol: ABBV) is the #122 most shorted of the S&P 500 components, based on 5.57 "days to cover." There are a number of ways to look at short data, but one metric that we find particularly useful is the "days to cover" because it considers both the total shares short and the average daily volume of shares typically traded. The number of shares short is then divided by the average daily volume, to express the total number of trading days it would take to close out all of the open short positions if every share traded represented a short position being closed.
In the case of AbbVie Inc (Symbol: ABBV), the total short interest at the 04/15/2019 settlement date was 27,575,807 shares, which compares to the average daily trading volume of just 4,952,645 shares, for a "days to cover" ratio of 5.57.
When short sellers eventually cover their positions, by definition there must be buying activity because a share that is currently sold short must be purchased to be covered. At the present levels of short interest, if from this point forward every single ABBV share traded represented a short position being closed, then at the average daily volume of 4,952,645 shares it would only be during the 6th trading day that every short position would be closed.
So it would stand to reason that should some unexpectedly good news come out, and short sellers did not have 6 days of patience but instead wanted to cover their short positions very suddenly, that situation could result in sending the stock higher until the higher price produces enough sellers to generate the necessary volume to close out those positions quickly.
AbbVie Inc (Symbol: ABBV) has something relatively rare for a stock with this much short interest, that being insiders taking the other side of the trade. Looking back over the trailing six month period, ABBV has seen 7 different instances of insider buying, as summarized by the table below:
Below is a chart showing the "days to cover" for ABBV over time:
And looking at the chart below, ABBV's low point in its 52 week range is $62.66 per share, with $96.60 as the 52 week high point — that compares with a last trade of $76.01.
In recent trading, shares of AbbVie Inc (Symbol: ABBV) were changing hands at $76.01/share.
Ten Bargains You Can Buy Cheaper Than The Insiders Did »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie Inc (Symbol: ABBV) has something relatively rare for a stock with this much short interest, that being insiders taking the other side of the trade. In recent trading, shares of AbbVie Inc (Symbol: ABBV) were changing hands at $76.01/share. The most recent short interest data was recently released for the 04/15/2019 settlement date, and AbbVie Inc (Symbol: ABBV) is the #122 most shorted of the S&P 500 components, based on 5.57 "days to cover." | The most recent short interest data was recently released for the 04/15/2019 settlement date, and AbbVie Inc (Symbol: ABBV) is the #122 most shorted of the S&P 500 components, based on 5.57 "days to cover." In the case of AbbVie Inc (Symbol: ABBV), the total short interest at the 04/15/2019 settlement date was 27,575,807 shares, which compares to the average daily trading volume of just 4,952,645 shares, for a "days to cover" ratio of 5.57. At the present levels of short interest, if from this point forward every single ABBV share traded represented a short position being closed, then at the average daily volume of 4,952,645 shares it would only be during the 6th trading day that every short position would be closed. | In the case of AbbVie Inc (Symbol: ABBV), the total short interest at the 04/15/2019 settlement date was 27,575,807 shares, which compares to the average daily trading volume of just 4,952,645 shares, for a "days to cover" ratio of 5.57. At the present levels of short interest, if from this point forward every single ABBV share traded represented a short position being closed, then at the average daily volume of 4,952,645 shares it would only be during the 6th trading day that every short position would be closed. The most recent short interest data was recently released for the 04/15/2019 settlement date, and AbbVie Inc (Symbol: ABBV) is the #122 most shorted of the S&P 500 components, based on 5.57 "days to cover." | In the case of AbbVie Inc (Symbol: ABBV), the total short interest at the 04/15/2019 settlement date was 27,575,807 shares, which compares to the average daily trading volume of just 4,952,645 shares, for a "days to cover" ratio of 5.57. At the present levels of short interest, if from this point forward every single ABBV share traded represented a short position being closed, then at the average daily volume of 4,952,645 shares it would only be during the 6th trading day that every short position would be closed. The most recent short interest data was recently released for the 04/15/2019 settlement date, and AbbVie Inc (Symbol: ABBV) is the #122 most shorted of the S&P 500 components, based on 5.57 "days to cover." |
24876.0 | 2019-09-30 00:00:00 UTC | 3 Dividend Stocks That Are Perfect for Retirement | ABBV | https://www.nasdaq.com/articles/3-dividend-stocks-that-are-perfect-for-retirement-2019-09-30 | nan | nan | Investors in retirement or close to it often look to dividend stocks to provide a steady source of income without having to sell shares when the market is on a downswing. But retirees should be planning an investment strategy that will support them into their 90s, which means that the plan will need to include growth that will stand up to future inflation.
Three stocks that have a dividend yield greater than today's paltry interest rates on savings accounts or government bonds and can protect your nest egg from the erosion of inflation are Prologis (NYSE: PLD), STORE Capital (NYSE: STOR), and AbbVie (NYSE: ABBV). Each of these businesses has a growth component, a strong history of dividend increases that exceed inflation, and the potential for capital gains when investors are holding shares for the long term.
Image source: Getty Images.
Prologis
One trend that shows no sign of slowing down is the growth of e-commerce. Not only are marketplaces like Amazon.com thriving, but many businesses in retail and manufacturing are finding it essential to have the ability to ship products directly to consumers in a matter of a couple of days or even less. This has created a huge demand for warehouses close to urban centers to support the broad selection of goods and delivery times consumers expect.
Enter Prologis, a real estate investment trust (REIT) that's the world leader in logistics real estate. The company owns warehouses and distribution centers that it rents to retailers, manufacturing companies, logistics companies, and the U.S. Government. Prologis has been doing this for 36 years and has huge scale: It estimates the economic value of goods passing through its distribution centers in 19 countries every year to be $1.5 trillion, or 2% of the world's gross domestic product. Its biggest customers are Amazon, Home Depot, FedEx, and Walmart, but Prologis is well diversified, and those heavy hitters contribute only 14.5% of its rental income.
What makes Prologis a good dividend stock for retirees is the growth component that the company brings to the portfolio. In the most recent quarter, core funds from operations (FFO), the equivalent of earnings for a REIT, grew 8.5% to $0.77 per share, and the company raised its guidance for full-year core FFO to $3.26 to $3.30, or an increase of 8.3% at the midpoint.
The current dividend yield for Prologis isn't overwhelming at 2.5%, but the potential for growth makes up for that. The company raised its dividend by 4% this year and the payout has grown 26% over the last three years. Share-price appreciation has been a big part of the total return, as well. Shares are up 50% this year and 71% over the last three years.
STORE Capital
With the e-commerce boom putting pressure on bricks-and mortar retail, you might think that a REIT that rents space to consumer-oriented businesses would not be a great opportunity. STORE Capital specializes in commercial real estate and counters that conventional wisdom with some particular characteristics are allowing it to thrive in this environment.
The "STORE" in the company's name is actually an acronym standing for "single tenant operational real estate." STORE Capital focuses on properties rented by single tenants that have a thriving and profitable operation at that particular location. STORE requires its tenants to submit financial statements to confirm that the location is profitable. Large chains tend to close their least profitable stores in times of financial stress, so STORE's insistence that its tenants have a thriving, profitable business at that location helps keep occupancy high and its cost of capital low.
The company also focuses on middle-market tenants in the service sector such as restaurants, early childhood education centers, health clubs, and movie theaters. These are businesses that aren't threatened by the e-commerce trend.
STORE continuously raises new capital through an "at the market" equity distribution -- meaning it's constantly diluting its shares by issuing new stock that it uses for acquiring new properties. But given that the company achieves net investment returns after operating costs of about 12%, the model is working to give shareholders compounding growth over time.
In the first six months of 2019, Store increased revenue 25%, thanks to 24% growth of its real estate portfolio. Adjusted funds from operations (AFFO) grew 25%, which translated to 10% growth in AFFO per share. The strength of the business model has attracted the attention of Warren Buffett, who owns an 8.2% stake in STORE Capital, the only REIT in Berkshire Hathaway's portfolio.
STORE Capital yields 3.7%, having just raised the dividend by 6% earlier this month. The dividend has risen 21% over the last three years, and shares have appreciated 44% in that time.
Abbvie
Investors frequently turn to the stocks of major drug manufacturers to get a reliable yield and some protection against a downturn in the economy. One quality company that's a bargain now and a good fit for retirement portfolios is AbbVie.
AbbVie stock has been under pressure since early 2018, and the biggest issue is biosimilar competition for immunology drug Humira, the world's top-selling drug and the source of 59% of the company's sales. Humira won't be up against biosimilars in the U.S. until 2023 but has direct competition in Europe today, which is taking a bite out of revenue. Last quarter, Humira sales in the U.S. grew 7.7%, but losses internationally meant worldwide sales slumped 3.9% in constant currency.
Then in June, AbbVie announced a plan to acquire Botox maker Allergan for $63 billion, and the stock took another tumble. Investors clearly were not impressed with the high price for a company that had growth challenges of its own.
Putting it simply, the market overreacted to both issues. The Allergan deal reduces dependence on Humira, diversifies the company into new therapeutic areas, and will add between 10% and 20% to earnings per share. As far as Humira is concerned, it still has three years of growth ahead in the U.S. market, and AbbVie is working on next-generation immunology drugs that should pick up some of the losses from the competition.
The stock is beginning to recover and is now only 4% below the share price the day before the Allergan announcement. But it's still undervalued, with a yield of 5.8%. Analysts expect earnings growth next year of 9%, and shares sell for 7.7 times the consensus earnings estimate for 2020. The dividend was hiked 11% this year and has increased a whopping 88% over the last three years.
AbbVie won't have the same level of growth that the other two picks will have, but the market is giving us an opportunity for a generous yield along with some capital gains as investors come to appreciate the strengths of the new, combined company, which include modest growth in the long term.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jim Crumly owns shares of AbbVie, Amazon, Berkshire Hathaway (B shares), Prologis, and STORE Capital. The Motley Fool owns shares of and recommends Amazon, Berkshire Hathaway (B shares), FedEx, and STORE Capital. The Motley Fool has the following options: short February 2020 $205 calls on Home Depot, long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), and long January 2021 $120 calls on Home Depot. The Motley Fool recommends Home Depot. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Three stocks that have a dividend yield greater than today's paltry interest rates on savings accounts or government bonds and can protect your nest egg from the erosion of inflation are Prologis (NYSE: PLD), STORE Capital (NYSE: STOR), and AbbVie (NYSE: ABBV). Abbvie Investors frequently turn to the stocks of major drug manufacturers to get a reliable yield and some protection against a downturn in the economy. One quality company that's a bargain now and a good fit for retirement portfolios is AbbVie. | AbbVie stock has been under pressure since early 2018, and the biggest issue is biosimilar competition for immunology drug Humira, the world's top-selling drug and the source of 59% of the company's sales. Three stocks that have a dividend yield greater than today's paltry interest rates on savings accounts or government bonds and can protect your nest egg from the erosion of inflation are Prologis (NYSE: PLD), STORE Capital (NYSE: STOR), and AbbVie (NYSE: ABBV). Abbvie Investors frequently turn to the stocks of major drug manufacturers to get a reliable yield and some protection against a downturn in the economy. | AbbVie won't have the same level of growth that the other two picks will have, but the market is giving us an opportunity for a generous yield along with some capital gains as investors come to appreciate the strengths of the new, combined company, which include modest growth in the long term. Jim Crumly owns shares of AbbVie, Amazon, Berkshire Hathaway (B shares), Prologis, and STORE Capital. Three stocks that have a dividend yield greater than today's paltry interest rates on savings accounts or government bonds and can protect your nest egg from the erosion of inflation are Prologis (NYSE: PLD), STORE Capital (NYSE: STOR), and AbbVie (NYSE: ABBV). | Three stocks that have a dividend yield greater than today's paltry interest rates on savings accounts or government bonds and can protect your nest egg from the erosion of inflation are Prologis (NYSE: PLD), STORE Capital (NYSE: STOR), and AbbVie (NYSE: ABBV). Abbvie Investors frequently turn to the stocks of major drug manufacturers to get a reliable yield and some protection against a downturn in the economy. One quality company that's a bargain now and a good fit for retirement portfolios is AbbVie. |
24877.0 | 2019-09-29 00:00:00 UTC | FTC Seeks Addl Information On AbbVie-Allergan $63 Bln Deal | ABBV | https://www.nasdaq.com/articles/ftc-seeks-addl-information-on-abbvie-allergan-%2463-bln-deal-2019-09-29 | nan | nan | (RTTNews) - The U.S. Federal Trade Commission has requested for additional information from AbbVie Inc (ABBV) and Allergan Plc (AGN) on their $63 billion deal, the companies said.
The Second Request extends the waiting period under the HSR Act until 30 days after both Allergan and AbbVie have substantially complied with the Second Request.
They are cooperating fully with the FTC and continue to expect to close the transaction in early 2020, the companies said.
Completion of the acquisition remains subject to the approval of Allergan shareholders and satisfaction of other customary closing conditions. Allergan has scheduled two special shareholder meetings on October 14, 2019 to seek the approval of its shareholders.
In June 2019, AbbVie agreed to acquire Allergan in a cash and stock transaction with an equity value of about $63 billion.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - The U.S. Federal Trade Commission has requested for additional information from AbbVie Inc (ABBV) and Allergan Plc (AGN) on their $63 billion deal, the companies said. In June 2019, AbbVie agreed to acquire Allergan in a cash and stock transaction with an equity value of about $63 billion. The Second Request extends the waiting period under the HSR Act until 30 days after both Allergan and AbbVie have substantially complied with the Second Request. | The Second Request extends the waiting period under the HSR Act until 30 days after both Allergan and AbbVie have substantially complied with the Second Request. (RTTNews) - The U.S. Federal Trade Commission has requested for additional information from AbbVie Inc (ABBV) and Allergan Plc (AGN) on their $63 billion deal, the companies said. In June 2019, AbbVie agreed to acquire Allergan in a cash and stock transaction with an equity value of about $63 billion. | (RTTNews) - The U.S. Federal Trade Commission has requested for additional information from AbbVie Inc (ABBV) and Allergan Plc (AGN) on their $63 billion deal, the companies said. The Second Request extends the waiting period under the HSR Act until 30 days after both Allergan and AbbVie have substantially complied with the Second Request. In June 2019, AbbVie agreed to acquire Allergan in a cash and stock transaction with an equity value of about $63 billion. | (RTTNews) - The U.S. Federal Trade Commission has requested for additional information from AbbVie Inc (ABBV) and Allergan Plc (AGN) on their $63 billion deal, the companies said. The Second Request extends the waiting period under the HSR Act until 30 days after both Allergan and AbbVie have substantially complied with the Second Request. In June 2019, AbbVie agreed to acquire Allergan in a cash and stock transaction with an equity value of about $63 billion. |
24878.0 | 2019-09-27 00:00:00 UTC | Health Care Sector Update for 09/27/2019: HSGX, PRPO, ABBV, JNJ, ABT, PFE, MRK, AMGN | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-09-27-2019%3A-hsgx-prpo-abbv-jnj-abt-pfe-mrk-amgn-2019-09-27 | nan | nan | Top Health Care Stocks:
JNJ: +0.12%
PFE: +0.61%
ABT: Flat
MRK: +0.44%
AMGN: +0.20%
Top health care stocks were flat to higher pre-market Friday.
Stocks moving on news include:
(-) Histogenics (HSGX), which was down more than 9% as its stockholders approved all proposals related to its proposed combination with Ocugen.
(+) Precipio (PRPO) was over 3% higher after saying several "large" laboratories have completed validation studies to test the company's IV-Cell cytogenetics media product, as well as its HemeScreen Assay, and are "proceeding toward placing orders."
In other sector news:
(+) AbbVie (ABBV) was marginally gaining as the Food and Drug Administration has approved the company's drug Mavyret to shorten the duration of treatment of chronic hepatitis C (HCV) patients across all genotypes.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In other sector news: (+) AbbVie (ABBV) was marginally gaining as the Food and Drug Administration has approved the company's drug Mavyret to shorten the duration of treatment of chronic hepatitis C (HCV) patients across all genotypes. Top health care stocks were flat to higher pre-market Friday. (+) Precipio (PRPO) was over 3% higher after saying several "large" laboratories have completed validation studies to test the company's IV-Cell cytogenetics media product, as well as its HemeScreen Assay, and are "proceeding toward placing orders." | In other sector news: (+) AbbVie (ABBV) was marginally gaining as the Food and Drug Administration has approved the company's drug Mavyret to shorten the duration of treatment of chronic hepatitis C (HCV) patients across all genotypes. Top Health Care Stocks: Top health care stocks were flat to higher pre-market Friday. | In other sector news: (+) AbbVie (ABBV) was marginally gaining as the Food and Drug Administration has approved the company's drug Mavyret to shorten the duration of treatment of chronic hepatitis C (HCV) patients across all genotypes. Top health care stocks were flat to higher pre-market Friday. Stocks moving on news include: (-) Histogenics (HSGX), which was down more than 9% as its stockholders approved all proposals related to its proposed combination with Ocugen. | In other sector news: (+) AbbVie (ABBV) was marginally gaining as the Food and Drug Administration has approved the company's drug Mavyret to shorten the duration of treatment of chronic hepatitis C (HCV) patients across all genotypes. Top health care stocks were flat to higher pre-market Friday. Stocks moving on news include: (-) Histogenics (HSGX), which was down more than 9% as its stockholders approved all proposals related to its proposed combination with Ocugen. |
24879.0 | 2019-09-26 00:00:00 UTC | AbbVie Receives FDA Approval Of MAVYRET | ABBV | https://www.nasdaq.com/articles/abbvie-receives-fda-approval-of-mavyret-2019-09-26 | nan | nan | (RTTNews) - AbbVie (ABBV) said that the U.S. Food and Drug Administration has approved MAVYRET or glecaprevir/pibrentasvir to shorten the once-daily treatment duration from 12 to 8 weeks in treatment-naïve, compensated cirrhotic, chronic hepatitis C or HCV patients across all genotypes or GT1-6.
In August 2017, MAVYRET received regulatory approval in the U.S. as an 8-week, pan-genotypic treatment for treatment-naïve HCV patients without cirrhosis.
Glecaprevir was discovered during the ongoing collaboration between AbbVie and Enanta Pharmaceuticals (ENTA) for HCV protease inhibitors and regimens that include protease inhibitors.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - AbbVie (ABBV) said that the U.S. Food and Drug Administration has approved MAVYRET or glecaprevir/pibrentasvir to shorten the once-daily treatment duration from 12 to 8 weeks in treatment-naïve, compensated cirrhotic, chronic hepatitis C or HCV patients across all genotypes or GT1-6. Glecaprevir was discovered during the ongoing collaboration between AbbVie and Enanta Pharmaceuticals (ENTA) for HCV protease inhibitors and regimens that include protease inhibitors. In August 2017, MAVYRET received regulatory approval in the U.S. as an 8-week, pan-genotypic treatment for treatment-naïve HCV patients without cirrhosis. | (RTTNews) - AbbVie (ABBV) said that the U.S. Food and Drug Administration has approved MAVYRET or glecaprevir/pibrentasvir to shorten the once-daily treatment duration from 12 to 8 weeks in treatment-naïve, compensated cirrhotic, chronic hepatitis C or HCV patients across all genotypes or GT1-6. Glecaprevir was discovered during the ongoing collaboration between AbbVie and Enanta Pharmaceuticals (ENTA) for HCV protease inhibitors and regimens that include protease inhibitors. In August 2017, MAVYRET received regulatory approval in the U.S. as an 8-week, pan-genotypic treatment for treatment-naïve HCV patients without cirrhosis. | (RTTNews) - AbbVie (ABBV) said that the U.S. Food and Drug Administration has approved MAVYRET or glecaprevir/pibrentasvir to shorten the once-daily treatment duration from 12 to 8 weeks in treatment-naïve, compensated cirrhotic, chronic hepatitis C or HCV patients across all genotypes or GT1-6. Glecaprevir was discovered during the ongoing collaboration between AbbVie and Enanta Pharmaceuticals (ENTA) for HCV protease inhibitors and regimens that include protease inhibitors. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - AbbVie (ABBV) said that the U.S. Food and Drug Administration has approved MAVYRET or glecaprevir/pibrentasvir to shorten the once-daily treatment duration from 12 to 8 weeks in treatment-naïve, compensated cirrhotic, chronic hepatitis C or HCV patients across all genotypes or GT1-6. Glecaprevir was discovered during the ongoing collaboration between AbbVie and Enanta Pharmaceuticals (ENTA) for HCV protease inhibitors and regimens that include protease inhibitors. In August 2017, MAVYRET received regulatory approval in the U.S. as an 8-week, pan-genotypic treatment for treatment-naïve HCV patients without cirrhosis. |
24880.0 | 2019-09-26 00:00:00 UTC | SPDR S&P Dividend ETF Experiences Big Outflow | ABBV | https://www.nasdaq.com/articles/spdr-sp-dividend-etf-experiences-big-outflow-2019-09-26 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the SPDR S&P Dividend ETF (Symbol: SDY) where we have detected an approximate $56.3 million dollar outflow -- that's a 0.3% decrease week over week (from 184,700,000 to 184,150,000). Among the largest underlying components of SDY, in trading today AbbVie Inc (Symbol: ABBV) is up about 2.7%, Realty Income Corp (Symbol: O) is up about 0.6%, and Cardinal Health, Inc. (Symbol: CAH) is lower by about 0.4%. For a complete list of holdings, visit the SDY Holdings page » The chart below shows the one year price performance of SDY, versus its 200 day moving average:
Looking at the chart above, SDY's low point in its 52 week range is $84.28 per share, with $104.25 as the 52 week high point — that compares with a last trade of $102.09. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of SDY, in trading today AbbVie Inc (Symbol: ABBV) is up about 2.7%, Realty Income Corp (Symbol: O) is up about 0.6%, and Cardinal Health, Inc. (Symbol: CAH) is lower by about 0.4%. For a complete list of holdings, visit the SDY Holdings page » The chart below shows the one year price performance of SDY, versus its 200 day moving average: Looking at the chart above, SDY's low point in its 52 week range is $84.28 per share, with $104.25 as the 52 week high point — that compares with a last trade of $102.09. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of SDY, in trading today AbbVie Inc (Symbol: ABBV) is up about 2.7%, Realty Income Corp (Symbol: O) is up about 0.6%, and Cardinal Health, Inc. (Symbol: CAH) is lower by about 0.4%. For a complete list of holdings, visit the SDY Holdings page » The chart below shows the one year price performance of SDY, versus its 200 day moving average: Looking at the chart above, SDY's low point in its 52 week range is $84.28 per share, with $104.25 as the 52 week high point — that compares with a last trade of $102.09. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). | Among the largest underlying components of SDY, in trading today AbbVie Inc (Symbol: ABBV) is up about 2.7%, Realty Income Corp (Symbol: O) is up about 0.6%, and Cardinal Health, Inc. (Symbol: CAH) is lower by about 0.4%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the SPDR S&P Dividend ETF (Symbol: SDY) where we have detected an approximate $56.3 million dollar outflow -- that's a 0.3% decrease week over week (from 184,700,000 to 184,150,000). For a complete list of holdings, visit the SDY Holdings page » The chart below shows the one year price performance of SDY, versus its 200 day moving average: Looking at the chart above, SDY's low point in its 52 week range is $84.28 per share, with $104.25 as the 52 week high point — that compares with a last trade of $102.09. | Among the largest underlying components of SDY, in trading today AbbVie Inc (Symbol: ABBV) is up about 2.7%, Realty Income Corp (Symbol: O) is up about 0.6%, and Cardinal Health, Inc. (Symbol: CAH) is lower by about 0.4%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the SPDR S&P Dividend ETF (Symbol: SDY) where we have detected an approximate $56.3 million dollar outflow -- that's a 0.3% decrease week over week (from 184,700,000 to 184,150,000). For a complete list of holdings, visit the SDY Holdings page » The chart below shows the one year price performance of SDY, versus its 200 day moving average: Looking at the chart above, SDY's low point in its 52 week range is $84.28 per share, with $104.25 as the 52 week high point — that compares with a last trade of $102.09. |
24881.0 | 2019-09-24 00:00:00 UTC | Better Buy: AbbVie vs. Eli Lilly | ABBV | https://www.nasdaq.com/articles/better-buy%3A-abbvie-vs.-eli-lilly-2019-09-24 | nan | nan | AbbVie (NYSE: ABBV) and Eli Lilly (NYSE: LLY) have been outstanding dividend and growth stocks for the better part of the last decade. These two pharma giants have generated total returns on capital (including dividends) of 52% and 97%, respectively, over the last five years.
Nonetheless, AbbVie and Lilly have both run into trouble in 2019 due to a mix of company-specific issues and industrywide headwinds. Which of these top pharma stocks has the best chance of breaking out of this recent funk? Let's take a look at the bull and bear case for each stock to find out.
Image source: Getty Images.
AbbVie's strengths and weaknesses
AbbVie has grown its top line and dividend at industry-leading levels ever since Abbott Laboratories spun the biotech off into a separate entity in 2013. Even so, the biotech's shares have still dropped by an unsightly 20% so far this year. The net result is that the drugmaker's stock is now trading at less than eight times forward earnings. That's a bargain-basement valuation for a blue-chip pharma stock.
So why are investors sidestepping this top biotech? Three reasons:
AbbVie's best-selling arthritis medication, Humira, is heading into its twilight years as a growth vehicle. The drug is already facing biosimilar competition in the EU, and biosimilars are slated to cut into its U.S. sales early in the next decade.
The company's recent high-dollar acquisition of Botox-maker Allergan (NYSE: AGN) dramatically increased its outstanding debt load. As long as Humira's U.S. sales decline gradually, the biotech should have sufficient free cash flows to deleverage promptly. But there's always the risk that Humira's U.S. sales will fall faster than expected.
AbbVie's blood cancer medication Imbruvica is staring down a slew of competitive threats. Most industry insiders expect Imbruvica to hold its own against these competitors, but nothing is guaranteed in the highly competitive and ever-evolving hematology space.
On the plus side of the ledger, AbbVie has significantly beefed up its product portfolio with the approval of three potential megablockbusters: Skyrizi for psoriasis, Rinvoq for rheumatoid arthritis, and Orilissa for uterine fibroids. Taken together, these three new growth products should help to steady the ship as AbbVie enters the next stage of its life cycle.
Eli Lilly's strengths and weaknesses
From the start of 2014 to the end of 2018, Lilly was one of the best-performing healthcare stocks. Lilly, in fact, produced total returns on capital of 160% over this four-year period. This year, however, hasn't been so kind to the big pharma.
Lilly's stock has slipped by nearly 1.5% in 2019 due to a variety of headwinds, including the ongoing cliff dives of former star products like Humalog and Cialis, the withdrawal of the soft tissue cancer medicine Lartruvo from the market, a safety ding for the breast cancer treatment Verzenio, and, most importantly, an increasingly competitive landscape for the company's best-selling type 2 diabetes medication, Trulicity.
It's not all doom and gloom for Lilly, however. Psoriatic arthritis drug Taltz, cancer treatment Cyramza, and migraine medicine Emgality are expected to drive a healthy 6.6% rise in revenue next year, compared to 2019.
That said, Lilly's shares are now trading at a whopping 17.3 times forward earnings, despite this encouraging outlook for its top line. The company's balance sheet is also highly leveraged at this point -- as evinced by its 575.1 debt-to-equity ratio. So Lilly may not be able to pursue any major business development opportunities in the near term to create additional value for shareholders.
Verdict
As things stand now, AbbVie arguably comes across as the more compelling buy. Lilly's stock sports a far richer valuation, and the drugmaker is also facing numerous headwinds in the diabetes space that could force a significant downward revenue revision for its top line within the next six months. AbbVie, on the other hand, has bolstered its anti-inflammatory portfolio with the recent approvals of both Skyrizi and Rinvoq. Moreover, the biotech's acquisition of Allergan should ultimately soften the blow of Humira's eventual decline.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | On the plus side of the ledger, AbbVie has significantly beefed up its product portfolio with the approval of three potential megablockbusters: Skyrizi for psoriasis, Rinvoq for rheumatoid arthritis, and Orilissa for uterine fibroids. AbbVie (NYSE: ABBV) and Eli Lilly (NYSE: LLY) have been outstanding dividend and growth stocks for the better part of the last decade. Nonetheless, AbbVie and Lilly have both run into trouble in 2019 due to a mix of company-specific issues and industrywide headwinds. | AbbVie (NYSE: ABBV) and Eli Lilly (NYSE: LLY) have been outstanding dividend and growth stocks for the better part of the last decade. AbbVie's strengths and weaknesses AbbVie has grown its top line and dividend at industry-leading levels ever since Abbott Laboratories spun the biotech off into a separate entity in 2013. Three reasons: AbbVie's best-selling arthritis medication, Humira, is heading into its twilight years as a growth vehicle. | AbbVie (NYSE: ABBV) and Eli Lilly (NYSE: LLY) have been outstanding dividend and growth stocks for the better part of the last decade. Nonetheless, AbbVie and Lilly have both run into trouble in 2019 due to a mix of company-specific issues and industrywide headwinds. AbbVie's strengths and weaknesses AbbVie has grown its top line and dividend at industry-leading levels ever since Abbott Laboratories spun the biotech off into a separate entity in 2013. | AbbVie's blood cancer medication Imbruvica is staring down a slew of competitive threats. AbbVie (NYSE: ABBV) and Eli Lilly (NYSE: LLY) have been outstanding dividend and growth stocks for the better part of the last decade. Nonetheless, AbbVie and Lilly have both run into trouble in 2019 due to a mix of company-specific issues and industrywide headwinds. |
24882.0 | 2019-09-24 00:00:00 UTC | Healthy Dividend Aristocrats: 6 Great Health-Care Dividend Stocks | ABBV | https://www.nasdaq.com/articles/healthy-dividend-aristocrats%3A-6-great-health-care-dividend-stocks-2019-09-24 | nan | nan | Sluggish global growth, the U.S. trade war with China and a stock market that's up only about 2% over the past year have some investors thinking about playing defense. And few equities are better at adding ballast to a portfolio than the rock-solid dividend growth stocks in the Dividend Aristocrats - companies in the S&P 500 that have raised their payouts every year for at least 25 consecutive years.
Also, few areas of the market hold up as well in downturns as the health-care sector. Put them together - health-care stocks with multiple decades uninterrupted dividend growth - and investors have a recipe for income and lower risk in their equity portfolios.
Six of the elite Dividend Aristocrats can be found in the health-care sector. These stocks, most of which are household names, have hiked their payouts for anywhere from 34 to 57 consecutive years. That's dividend growth an income investor can count on.
For dividend growth and defense, take a closer look at these six health-care Dividend Aristocrats.
SEE ALSO: 101 Best Dividend Stocks to Buy for 2019 and Beyond
Becton Dickinson
Market value: $68.4 billion
Dividend yield: 1.2%
Consecutive annual dividend increases: 47
Analysts' opinion: 10 strong buy, 3 buy, 7 hold, 0 sell, 0 strong sell
Medical devices maker Becton Dickinson (BDX, $253.43) has been leaning on mergers & acquisitions (M&A) to make hay over the past few years. It bulked up with its 2015 acquisition of CareFusion, a complementary player in the same industry. Then in 2017, it snapped up fellow Dividend Aristocrat C.R. Bard, another medical products company with a strong position in treatments for infectious diseases, for $24 billion.
Becton Dickinson's wares cover everything from diabetes care to lab automation to vascular surgery and much, much more. And while it is a massive player in the U.S., BDX increasingly expects its growth to be driven by markets outside the U.S., including China. Analysts expect Becton to generate average annual earnings growth of 11.2% for the next three to five years, according to S&P Global Market Intelligence.
Annual dividend increases stretch back 47 years and counting - a track record that should offer peace of mind to antsy income investors. The company has grown its payout by a total of 41% over the past five years, though that pace has slowed a bit more recently. If BDX sticks to its usual script, it should announce its next dividend hike in mid- to late November.
SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained
Abbott Laboratories
Market value: $147.0 billion
Dividend yield: 1.5%
Consecutive annual dividend increases: 47
Analysts' opinion: 11 strong buy, 7 buy, 3 hold, 1 sell, 0 strong sell
Abbott Laboratories (ABT, $83.16) actually split into a pair of Dividend Aristocrats when it spun off AbbVie in 2013. Remaining with Abbott Labs were businesses focused on branded generic drugs, medical devices, nutrition and diagnostic products. Its offerings include some well-known consumer brands such as Similac infant formulas, Glucerna diabetes management shakes and bars, and Pedialyte rehydration solutions. But it's also involved with devices such as i-Stat blood analyzers and Prodigy spinal cord stimulation (SCS) implants.
Like BDX, Abbott has expanded by acquisition of late. In 2017, it bought both medical-device firm St. Jude Medical and rapid-testing technology business Alere.
Abbott Labs' roots go back to 1888, and its dividend has been around since 1924. ABT has raised its dividend for 47 straight years, including a hefty 14.3% hike that went into effect in February 2019.
SEE ALSO: 25 Dividend Stocks That Analysts Love the Most
Medtronic
Market value: $148.7 billion
Dividend yield: 2.0%
Consecutive annual dividend increases: 42
Analysts' opinion: 12 strong buy, 7 buy, 9 hold, 0 sell, 0 strong sell
Medtronic (MDT, $110.84), one of the world's largest makers of medical devices, is an income machine. The company's dividend per share has increased 77% over the past five years, Medtronic notes, and has grown at a 17% compounded annual growth rate over the past 42 years. Most recently, in June, MDT lifted its quarterly payout by 8% to 54 cents a share to maintain its spot in the Dividend Aristocrats.
Medtronic aims to return at least 50% of its free cash flow to shareholders through dividends and stock buybacks. The company can steer all this cash back to shareholders thanks to the ubiquity of its products. Medtronic holds more than 4,600 patents on products ranging from external defibrillators to replacement heart valves to surgical stapling devices.
Whether you're in the U.S. or in about 160 other countries, if you take a look around your hospital or doctor's office, chances are good you'll see a Medtronic product.
SEE ALSO: 6 Best Health Care Funds for a Volatile Market
Johnson & Johnson
Market value: $347.7 billion
Dividend yield: 2.9%
Consecutive annual dividend increases: 57
Analysts' opinion: 4 strong buy, 5 buy, 9 hold, 1 sell, 1 strong sell
Johnson & Johnson's (JNJ, $131.74) roots stretch back to the 19th century, and it remains one of the country's leading health-care stocks, on several fronts. Chances are you know J&J for its consumer brands, which include Band-Aid, Neosporin, Listerine, Clean & Clear, and of course Johnson's baby products. But it also has pharmaceutical products, through its Janssen and Actelion arms, and it amanufactures medical devices used in surgery.
From the occasional disappointing results to litigation, Johnson & Johnson has had its ups and downs over the years. But so far, that has not affected investors who count on JNJ's steady dividend. The health-care giant hiked its payout by 5.6% in April 2019, extending its streak of consecutive annual dividend increases to 57.
That should continue if Johnson & Johnson can keep growing its earnings; analysts expect it to, at a clip of 6.9% annually on average over the next three to five years.
SEE ALSO: All 30 Dow Stocks Ranked: The Analysts Weigh In
Cardinal Health
Market value: $13.8 billion
Dividend yield: 4.1%
Consecutive annual dividend increases: 34
Analysts' opinion: 1 strong buy, 2 buy, 14 hold, 1 sell, 2 strong sell
Cardinal Health (CAH, $47.17), like other health-care stocks on this list, became the giant that it is today in decent part thanks to a steady stream of acquisitions.
More recently, it has been embroiled in legal actions related to the nation's opioid epidemic. In late 2016, Cardinal Health agreed to pay $44 million to the Department of Justice to settle allegations that it failed to report suspicious drug orders. And in early 2017, the company agreed to a $20 million settlement with the state of West Virginia. The company warned in August that it expects to have to defend itself against more litigation, too.
However, Cardinal Health is looking for new life with its $6.1 acquisition of Medtronic's Patient Care, Deep Vein Thrombosis and Nutritional Insufficiency business, completed in July 2017.
On the dividend front, CAH has upped the ante on its annual payout for 34 years and counting. The company remains in the Dividend Aristocrats courtesy of its last dividend hike - a 1% bump to 48.11 cents per share announced in May.
SEE ALSO: The 20 Best Small-Cap Dividend Stocks to Buy
AbbVie
Market value: $107.8 billion
Dividend yield: 5.9%
Consecutive annual dividend increases: 47
Analysts' opinion: 5 strong buy, 1 buy, 6 hold, 0 sell, 0 strong sell
If you read closely above, you're now familiar with AbbVie's (ABBV, $72.93) corporate heritage. But a quick reminder: It was spun off from Abbott Laboratories in 2013.
AbbVie is a biopharmaceutical company with a laundry list of treatments that include Humira for rheumatoid arthritis; AndroGel, a testosterone replacement therapy; and Viekira Pak for hepatitis C. All told, AbbVie's product pipeline spans 50 total indications - 14 approved, and 36 still in trial stages. But AbbVie also is looking to grow via M&A. In June, the company announced a $63 billion deal to buy Dublin-based Allergan (AGN), which is famous for the Botox brand but also boasts Restasis eye drops, irritable bowel syndrome treatment Linzess and "fat freezing" technology CoolSculpting.
After the split, AbbVie and Abbott Laboratories both retained credit for the longstanding dividend-growth streak. Including its time as part of Abbott, ABBV upped its annual distribution for 47 consecutive years, with the last hike (an 11.5% increase) coming in February.
SEE ALSO: Where Millionaires Live in America 2019
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained Abbott Laboratories Market value: $147.0 billion Dividend yield: 1.5% Consecutive annual dividend increases: 47 Analysts' opinion: 11 strong buy, 7 buy, 3 hold, 1 sell, 0 strong sell Abbott Laboratories (ABT, $83.16) actually split into a pair of Dividend Aristocrats when it spun off AbbVie in 2013. SEE ALSO: The 20 Best Small-Cap Dividend Stocks to Buy AbbVie Market value: $107.8 billion Dividend yield: 5.9% Consecutive annual dividend increases: 47 Analysts' opinion: 5 strong buy, 1 buy, 6 hold, 0 sell, 0 strong sell If you read closely above, you're now familiar with AbbVie's (ABBV, $72.93) corporate heritage. AbbVie is a biopharmaceutical company with a laundry list of treatments that include Humira for rheumatoid arthritis; AndroGel, a testosterone replacement therapy; and Viekira Pak for hepatitis C. All told, AbbVie's product pipeline spans 50 total indications - 14 approved, and 36 still in trial stages. | SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained Abbott Laboratories Market value: $147.0 billion Dividend yield: 1.5% Consecutive annual dividend increases: 47 Analysts' opinion: 11 strong buy, 7 buy, 3 hold, 1 sell, 0 strong sell Abbott Laboratories (ABT, $83.16) actually split into a pair of Dividend Aristocrats when it spun off AbbVie in 2013. SEE ALSO: The 20 Best Small-Cap Dividend Stocks to Buy AbbVie Market value: $107.8 billion Dividend yield: 5.9% Consecutive annual dividend increases: 47 Analysts' opinion: 5 strong buy, 1 buy, 6 hold, 0 sell, 0 strong sell If you read closely above, you're now familiar with AbbVie's (ABBV, $72.93) corporate heritage. AbbVie is a biopharmaceutical company with a laundry list of treatments that include Humira for rheumatoid arthritis; AndroGel, a testosterone replacement therapy; and Viekira Pak for hepatitis C. All told, AbbVie's product pipeline spans 50 total indications - 14 approved, and 36 still in trial stages. | SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained Abbott Laboratories Market value: $147.0 billion Dividend yield: 1.5% Consecutive annual dividend increases: 47 Analysts' opinion: 11 strong buy, 7 buy, 3 hold, 1 sell, 0 strong sell Abbott Laboratories (ABT, $83.16) actually split into a pair of Dividend Aristocrats when it spun off AbbVie in 2013. SEE ALSO: The 20 Best Small-Cap Dividend Stocks to Buy AbbVie Market value: $107.8 billion Dividend yield: 5.9% Consecutive annual dividend increases: 47 Analysts' opinion: 5 strong buy, 1 buy, 6 hold, 0 sell, 0 strong sell If you read closely above, you're now familiar with AbbVie's (ABBV, $72.93) corporate heritage. AbbVie is a biopharmaceutical company with a laundry list of treatments that include Humira for rheumatoid arthritis; AndroGel, a testosterone replacement therapy; and Viekira Pak for hepatitis C. All told, AbbVie's product pipeline spans 50 total indications - 14 approved, and 36 still in trial stages. | SEE ALSO: The Berkshire Hathaway Portfolio: All 47 Buffett Stocks Explained Abbott Laboratories Market value: $147.0 billion Dividend yield: 1.5% Consecutive annual dividend increases: 47 Analysts' opinion: 11 strong buy, 7 buy, 3 hold, 1 sell, 0 strong sell Abbott Laboratories (ABT, $83.16) actually split into a pair of Dividend Aristocrats when it spun off AbbVie in 2013. SEE ALSO: The 20 Best Small-Cap Dividend Stocks to Buy AbbVie Market value: $107.8 billion Dividend yield: 5.9% Consecutive annual dividend increases: 47 Analysts' opinion: 5 strong buy, 1 buy, 6 hold, 0 sell, 0 strong sell If you read closely above, you're now familiar with AbbVie's (ABBV, $72.93) corporate heritage. AbbVie is a biopharmaceutical company with a laundry list of treatments that include Humira for rheumatoid arthritis; AndroGel, a testosterone replacement therapy; and Viekira Pak for hepatitis C. All told, AbbVie's product pipeline spans 50 total indications - 14 approved, and 36 still in trial stages. |
24883.0 | 2019-09-23 00:00:00 UTC | The Math Shows XLG Can Go To $237 | ABBV | https://www.nasdaq.com/articles/the-math-shows-xlg-can-go-to-%24237-2019-09-23 | nan | nan | Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the Invesco S&P 500— Top 50 ETF (Symbol: XLG), we found that the implied analyst target price for the ETF based upon its underlying holdings is $236.54 per unit.
With XLG trading at a recent price near $214.41 per unit, that means that analysts see 10.32% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of XLG's underlying holdings with notable upside to their analyst target prices are Johnson & Johnson (Symbol: JNJ), AbbVie Inc (Symbol: ABBV), and Bank of America Corp (Symbol: BAC). Although JNJ has traded at a recent price of $131.65/share, the average analyst target is 13.11% higher at $148.91/share. Similarly, ABBV has 12.49% upside from the recent share price of $72.39 if the average analyst target price of $81.43/share is reached, and analysts on average are expecting BAC to reach a target price of $33.25/share, which is 12.37% above the recent price of $29.59. Below is a twelve month price history chart comparing the stock performance of JNJ, ABBV, and BAC:
Combined, JNJ, ABBV, and BAC represent 5.65% of the Invesco S&P 500— Top 50 ETF. Below is a summary table of the current analyst target prices discussed above:
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.
10 ETFs With Most Upside To Analyst Targets »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Below is a twelve month price history chart comparing the stock performance of JNJ, ABBV, and BAC: Combined, JNJ, ABBV, and BAC represent 5.65% of the Invesco S&P 500— Top 50 ETF. Three of XLG's underlying holdings with notable upside to their analyst target prices are Johnson & Johnson (Symbol: JNJ), AbbVie Inc (Symbol: ABBV), and Bank of America Corp (Symbol: BAC). Similarly, ABBV has 12.49% upside from the recent share price of $72.39 if the average analyst target price of $81.43/share is reached, and analysts on average are expecting BAC to reach a target price of $33.25/share, which is 12.37% above the recent price of $29.59. | Three of XLG's underlying holdings with notable upside to their analyst target prices are Johnson & Johnson (Symbol: JNJ), AbbVie Inc (Symbol: ABBV), and Bank of America Corp (Symbol: BAC). Similarly, ABBV has 12.49% upside from the recent share price of $72.39 if the average analyst target price of $81.43/share is reached, and analysts on average are expecting BAC to reach a target price of $33.25/share, which is 12.37% above the recent price of $29.59. Below is a twelve month price history chart comparing the stock performance of JNJ, ABBV, and BAC: Combined, JNJ, ABBV, and BAC represent 5.65% of the Invesco S&P 500— Top 50 ETF. | Similarly, ABBV has 12.49% upside from the recent share price of $72.39 if the average analyst target price of $81.43/share is reached, and analysts on average are expecting BAC to reach a target price of $33.25/share, which is 12.37% above the recent price of $29.59. Three of XLG's underlying holdings with notable upside to their analyst target prices are Johnson & Johnson (Symbol: JNJ), AbbVie Inc (Symbol: ABBV), and Bank of America Corp (Symbol: BAC). Below is a twelve month price history chart comparing the stock performance of JNJ, ABBV, and BAC: Combined, JNJ, ABBV, and BAC represent 5.65% of the Invesco S&P 500— Top 50 ETF. | Below is a twelve month price history chart comparing the stock performance of JNJ, ABBV, and BAC: Combined, JNJ, ABBV, and BAC represent 5.65% of the Invesco S&P 500— Top 50 ETF. Three of XLG's underlying holdings with notable upside to their analyst target prices are Johnson & Johnson (Symbol: JNJ), AbbVie Inc (Symbol: ABBV), and Bank of America Corp (Symbol: BAC). Similarly, ABBV has 12.49% upside from the recent share price of $72.39 if the average analyst target price of $81.43/share is reached, and analysts on average are expecting BAC to reach a target price of $33.25/share, which is 12.37% above the recent price of $29.59. |
24884.0 | 2019-09-21 00:00:00 UTC | 2 Pharma Stocks You Should Buy Now | ABBV | https://www.nasdaq.com/articles/2-pharma-stocks-you-should-buy-now-2019-09-21 | nan | nan | The pharmaceutical industry is important for one simple reason: we are all, at some point, in need of medical treatment, and the amount of money that is spent on drugs continues to increase. Until we stumble upon a way to eradicate illnesses altogether, that isn't going to change. Though we can't escape from this sad reality, we may profit from it by investing in pharmaceutical companies that develop state of the art prescription drugs. Obviously, there are dozens of pharma stocks to choose from, but two that I think present particularly strong prospects are Vertex Pharmaceuticals (NASDAQ: VRTX) and Merck (NYSE: MRK).
Image source: Getty Images
Dominating the cystic fibrosis market
Vertex' annual revenues have increased by more than 400% since 2014. Over the same period, the firm turned a net loss of $739 million to a profit of over $2 billion, and its share price grew by about 130%.
This performance can be attributed to its monopoly on the market for drugs that treat cystic fibrosis (CF). The rare genetic condition affects upward of 75,000 people worldwide, according to some estimates.
All of Vertex' approved drugs -- Kalydeco, Orkambi, and Symdeko -- treat the underlying causes of CF. Unfortunately, all three drugs are limited in their scope to treat the rare lung disease. As we speak, only about 39,000 of those living with CF are eligible for one of Vertex' drugs, and the number of patients actually taking these medicines is likely a lot lower. There is some good news, though. Back in May, the pharma company announced positive results from a Phase 3 study for a trio of new drugs that could treat up to 90% of patients with CF.
Vertex' application for these drugs -- VX-445, Tezacaftor, and Ivacaftor -- will likely receive approval from the FDA by early 2020. This new development could help the firm sustain strong top line growth as the market for its drugs expands substantially. Further, Vertex is looking for ways to diversify its product offerings. The company's pipeline includes various pain medications, and a treatment for alpha-1 antitrypsin deficiency, a condition that raises the risk for lung disease. Finally, Vertex recently acquired privately held biotech company Semma Therapeutics with the ambitious goal of finding a cure for type 1 diabetes. Of course, there is no guarantee that this partnership will produce anything fruitful, but if it does, Vertex would reap the benefits for many years to come.
The soon-to-be world's best selling drug?
Over the past few years, Merck's key growth driver has been none other than Keytruda. The pharma company's top selling product is approved for a range of cancers, including gastric cancer, esophageal cancer, small cell lung cancer, non-small cell lung cancer, head and neck cancer, among others.
What's more, there are still dozens of clinical trials involving Keytruda, which means the cancer drug has a bright future ahead. Sales of Keytruda have increased by more than 5000% since 2014. After ranking third on the list of world's top selling drugs last year, Keytruda is projected to take the top spot by 2024 as the current top selling medicine -- AbbVie's (NYSE: ABBV) Humira -- faces stiff competition from biosimilars in Europe.
Though Keytruda makes up the lion's share of Merck's revenues, the firm has other products to rely on. In particular, Merck's vaccines business is booming. The company's Gardasil and Gardasil 9 -- which prevent certain cancers and other diseases caused by HPV -- saw their combined second quarter sales soar by 46% year-over-year. Merck's package of several vaccines that help prevent diseases such as measles, mumps, rubella, chickenpox, and varicella also grew by 58% compared to the previous year.
Lastly, Merck has several ongoing partnerships with other pharma companies. Last year, the FDA approved Lynparza, a treatment for ovarian cancer and breast cancer Merck markets with AstraZeneca (NYSE: AZN). The potential clientele for this medicine is vast, and it could help Merck decrease its top line exposure to Keytruda.
Are they buys?
Vertex' hold on the market for drugs that treat CF will likely continue pushing its earnings upward, especially considering the market for its medicines will become much larger. Meanwhile, Merck's Keytruda is on pace to become the world's best selling drug by 2024. While both companies could run into problems if their top selling products start encountering strong competition, the near to mid-term landscape looks relatively bright for these pharma stocks.
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Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool recommends Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | After ranking third on the list of world's top selling drugs last year, Keytruda is projected to take the top spot by 2024 as the current top selling medicine -- AbbVie's (NYSE: ABBV) Humira -- faces stiff competition from biosimilars in Europe. The pharmaceutical industry is important for one simple reason: we are all, at some point, in need of medical treatment, and the amount of money that is spent on drugs continues to increase. Finally, Vertex recently acquired privately held biotech company Semma Therapeutics with the ambitious goal of finding a cure for type 1 diabetes. | After ranking third on the list of world's top selling drugs last year, Keytruda is projected to take the top spot by 2024 as the current top selling medicine -- AbbVie's (NYSE: ABBV) Humira -- faces stiff competition from biosimilars in Europe. Image source: Getty Images Dominating the cystic fibrosis market Vertex' annual revenues have increased by more than 400% since 2014. The pharma company's top selling product is approved for a range of cancers, including gastric cancer, esophageal cancer, small cell lung cancer, non-small cell lung cancer, head and neck cancer, among others. | After ranking third on the list of world's top selling drugs last year, Keytruda is projected to take the top spot by 2024 as the current top selling medicine -- AbbVie's (NYSE: ABBV) Humira -- faces stiff competition from biosimilars in Europe. The pharma company's top selling product is approved for a range of cancers, including gastric cancer, esophageal cancer, small cell lung cancer, non-small cell lung cancer, head and neck cancer, among others. Vertex' hold on the market for drugs that treat CF will likely continue pushing its earnings upward, especially considering the market for its medicines will become much larger. | After ranking third on the list of world's top selling drugs last year, Keytruda is projected to take the top spot by 2024 as the current top selling medicine -- AbbVie's (NYSE: ABBV) Humira -- faces stiff competition from biosimilars in Europe. Meanwhile, Merck's Keytruda is on pace to become the world's best selling drug by 2024. 10 stocks we like better than Merck & Co. |
24885.0 | 2019-09-18 00:00:00 UTC | An Investor's Guide to Disrupting Drugmakers | ABBV | https://www.nasdaq.com/articles/an-investors-guide-to-disrupting-drugmakers-2019-09-18 | nan | nan | When you need a medication that's insanely expensive, what choice do you have other than to grin and bear it?
Make it yourself, apparently.
A group in Oakland, California, the Open Insulin Project, is trying to do just that for diabetics who can't afford their medication.
In theory, it's not that hard to produce insulin. It's a peptide -- a short protein -- that cells can be genetically engineered to produce. Just grow the cells and purify the insulin away from the other cellular components.
In reality, both production and purification can be challenging. And keeping high quality control standards to reduce variations among the batches is even harder. There are reasons the Food and Drug Administration regulates these things.
The Open Insulin Project is still at it.
Image source: Getty Images.
Expensively cheap medication
The patent on basic insulin ran out years ago. In fact, it was reportedly sold by the three inventors for $1 each in 1923 because they believed the medication should be freely available.
But newer insulin products that arguably work better are covered under new patents. Novo Nordisk's (NYSE: NVO) Tresiba, for example, is a long-acting insulin that users take only once a day.
For basic insulin, insurance companies and pharmacy benefit managers have been able to pit insulin makers -- Eli Lilly (NYSE: LLY), Sanofi (NASDAQ: SNY), and Novo Nordisk -- against each other, refusing to put them on their formularies (the lists of drugs they cover) if the companies didn't lower their prices.
That move has caused basic insulin sales to plummet. For example, U.S. sales of Novo Nordisk's human insulin were down 31% at constant exchange rates in the first half of the year, although the company was able to make up some of that by selling its newer modern insulins, resulting in just a 16% drop total of U.S. insulin sales at constant exchange rates.
The lower prices are great for the payers, but people without insurance are still charged full price, although companies often offer discounts to uninsured patients.
Image source: Getty Images.
Patents and monopolies
In most industries patents create monopolies, but when it comes to drug pricing, the story is a little more complex.
High drug prices can exist without patents when there's limited competition. A temporary monopoly can be caused by the need to gain FDA approval to manufacture a generic drug.
And while patents can keep branded drugs from facing generic competition, they can't limit competition from other branded drugs. The price of hepatitis C drugs from Gilead Sciences (NASDAQ: GILD), for example, has come down substantially as AbbVie (NYSE: ABBV) has gained approval for competing regimens. With either company able to cure almost all infected patients, it's easy for payers to pit them against each other to gain the best prices.
Disrupting supply and demand
Most generic drugs are cheap because they have substantial competition. The Food and Drug Administration did a study that found the presence of nine generic manufacturers resulted in a price that was 20% of the branded drug's. But just a single generic competitor allowed the manufacturer to price its name-brand drug at 94% of what the price would be otherwise.
Beyond insulin, there are plenty of examples of companies that have taken advantage of a lack of competitors and raised the price of a drug.
To combat drug shortages and escalating drug prices, seven health systems came together last year to form Civica Rx, a not-for-profit company with plans to get FDA approval to manufacture, either directly or through a contract manufacturer, drugs that are in short supply and/or are being sold for substantially more than their manufacturing costs.
And the government is considering getting in the game, too. Last year, presidential candidate Elizabeth Warren introduced a bill, the Affordable Drug Manufacturing Act, that would authorize the Department of Health and Human Services to manufacture a generic drug if no company is selling the drug, if the drug is in short supply, or if there is a spike in the drug price with one or two companies producing the drug.
Be the disruptor
Investors in branded drugs don't really need to worry about biohackers, the government, or not-for-profit enterprises competing with branded drugs. Makers of generic drugs may have problems, but likely only if they've taken advantage of a lack of competition to raise a price enough to get on these groups' radar.
The bigger worry for branded drug companies comes from other branded drugs treating the same diseases. To really profit, investors should look for companies going after conditions for which no treatments exist or making radical moves to provide substantially better offerings than are currently available.
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Brian Orelli has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Gilead Sciences. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The price of hepatitis C drugs from Gilead Sciences (NASDAQ: GILD), for example, has come down substantially as AbbVie (NYSE: ABBV) has gained approval for competing regimens. For basic insulin, insurance companies and pharmacy benefit managers have been able to pit insulin makers -- Eli Lilly (NYSE: LLY), Sanofi (NASDAQ: SNY), and Novo Nordisk -- against each other, refusing to put them on their formularies (the lists of drugs they cover) if the companies didn't lower their prices. To really profit, investors should look for companies going after conditions for which no treatments exist or making radical moves to provide substantially better offerings than are currently available. | The price of hepatitis C drugs from Gilead Sciences (NASDAQ: GILD), for example, has come down substantially as AbbVie (NYSE: ABBV) has gained approval for competing regimens. For example, U.S. sales of Novo Nordisk's human insulin were down 31% at constant exchange rates in the first half of the year, although the company was able to make up some of that by selling its newer modern insulins, resulting in just a 16% drop total of U.S. insulin sales at constant exchange rates. And while patents can keep branded drugs from facing generic competition, they can't limit competition from other branded drugs. | The price of hepatitis C drugs from Gilead Sciences (NASDAQ: GILD), for example, has come down substantially as AbbVie (NYSE: ABBV) has gained approval for competing regimens. For basic insulin, insurance companies and pharmacy benefit managers have been able to pit insulin makers -- Eli Lilly (NYSE: LLY), Sanofi (NASDAQ: SNY), and Novo Nordisk -- against each other, refusing to put them on their formularies (the lists of drugs they cover) if the companies didn't lower their prices. To combat drug shortages and escalating drug prices, seven health systems came together last year to form Civica Rx, a not-for-profit company with plans to get FDA approval to manufacture, either directly or through a contract manufacturer, drugs that are in short supply and/or are being sold for substantially more than their manufacturing costs. | The price of hepatitis C drugs from Gilead Sciences (NASDAQ: GILD), for example, has come down substantially as AbbVie (NYSE: ABBV) has gained approval for competing regimens. For basic insulin, insurance companies and pharmacy benefit managers have been able to pit insulin makers -- Eli Lilly (NYSE: LLY), Sanofi (NASDAQ: SNY), and Novo Nordisk -- against each other, refusing to put them on their formularies (the lists of drugs they cover) if the companies didn't lower their prices. The Food and Drug Administration did a study that found the presence of nine generic manufacturers resulted in a price that was 20% of the branded drug's. |
24886.0 | 2019-09-15 00:00:00 UTC | What Is a Dividend Aristocrat? | ABBV | https://www.nasdaq.com/articles/what-is-a-dividend-aristocrat-2019-09-15 | nan | nan | Millions of investors own stocks that regularly pay out dividends of varying amounts per share, but few are familiar with an elite class of dividend stocks known as Dividend Aristocrats.
In this article, we'll break down exactly why Dividend Aristocrats are so attractive to investors and share a few aristocrat stocks that could help unlock the full potential of your portfolio.
What is a dividend?
A dividend is a payment from a company's profits to its shareholders. Just as all stocks are created differently, so are dividends. Different companies pay out different dividend amounts. For example, if a company pays 3% of its total stock price each quarter, an investor with $100 in that stock gets $3 back every quarter. Of course, this number can fluctuate vastly depending on a company's success.
Not all companies pay their investors dividends. Typically, the companies that offer consistent and increasingly higher dividend yields are older and more established businesses. These are companies that have been around for decades, perhaps even centuries, and can afford to let go of some of their liquid capital each quarter without needing to immediately reinvest it in the business to fund things like research, development, marketing, or paying off debt.
A special collection of established and reliable companies known as Dividend Aristocrats can help make investing in dividends a relative no-brainer.
Image Source: Getty Images.
What are Dividend Aristocrats?
The term "Dividend Aristocrats" is trademarked by the financial firm Standard & Poor's, and S&P maintains strict definitions for several classes of aristocrat stocks. Most commonly, though, investors who are referring to Dividend Aristocrats colloquially are talking about companies on the S&P 500 index that have increased their dividend payouts for 25 consecutive years or more, at least once a year. These companies have never decreased their dividend payout to shareholders during that time.
First established in 1989, this index contained the most stocks in 2001, but given considerable changes in dividend policy among companies over the past two decades or so, the list has undergone significant scale-backs and revisions.
The number of companies on the list tends to coincide with historically significant bear markets. For example, the initial list of just 26 companies was published 25 years after the down years of 1973-1974. That tough economy very likely forced many companies to freeze or drop their dividends, disqualifying them from the original list 25 years later. Likewise, the list peaked in 2001 at 64 and again at 60 in 2008. The recessions that immediately followed those peaks once again forced numerous Dividend Aristocrats off the list.
Many stocks listed on the index are familiar household names. Coca-Cola, ExxonMobil, and McDonald's have all managed to retain their status as Dividend Aristocrats for more than a quarter of a century. There are 57 companies on the list currently, with the consumer staples category containing the most. These include companies like The Clorox Company, Colgate Palmolive, Kimberly Clark, and PepsiCo. But industrials don't trail far behind, making up more than a fifth of the companies listed. Think 3M, General Dynamics, and Stanley Black and Decker.
The list of Dividend Aristocrats tends to fluctuate semiregularly, with new companies being added (and, unfortunately, occasionally subtracted) every year. Here's a full list of the S&P 500 Dividend Aristocrats as it stood in August 2019:
Source: S&P Dow Jones Indices.
Why Dividend Aristocrats make strong investments
Not just any company is capable of increasing its dividend for 25-plus years. The sustained success required is, almost by definition, next to impossible. Only around 10% of companies on the S&P 500 qualify today, after all. To achieve such a feat, a company must be consistent and resilient and have strong competitive advantages and excellent capital allocation.
Economically speaking, this means a company must have a demonstrated record of raising its earnings and cash flow and sharpening its balance sheet to make those payments to its eager investors. That combination of factors leads to strong fundamental performance first. The dividend strength is a reflection of those fundamentals, not the other way around. In other words, a company doesn't become successful because it offers dividends; a company offers dividends because it is successful.
How Dividend Aristocrats benefit your returns
When it comes to Dividend Aristocrats' yield, a couple of percentage points might not sound like much: 3% of a $100 stock barely buys you a candy bar at your local gas station. But it's not just about how high a yield is. One should also consider the payout ratio, which is how smart investors examine a company's sustainability. Mathematically speaking, a payout ratio is calculated by dividing dividends per share (DPS) by earnings per share (EPS).
Let's look at an example. Say a company has earnings per share of $5 and dividends per share of $2. Its payout ratio would therefore be 40%.
Investors use this figure to determine the sustainability of the company's business. The higher its payout ratio is, the more a company is spending to maintain its dividend payments. If, for example, a stock's payout ratio is 100%, it means the company is spending all of its earnings on paying investors dividends. This is an unsustainable model for obvious reasons.
But Dividend Aristocrats are different. They're resilient, established companies with proven records. They're bringing in sustainable income, and we can mostly trust that they aren't going anywhere. They can afford to toggle their dividend payout ratio -- and consistently raise it -- without upsetting their balance sheets.
Many of the companies listed as Dividend Aristocrats, therefore, have been in business for decades. Some, like 3M, Coca-Cola, and PepsiCo have lasted more than a century. Dividend aristocrats also tend to follow the S&P 500, many times outperforming it. Since many of these companies are also on the S&P 500, it makes sense that the Dividend Aristocrats would follow such a reliable trend. However, not all companies on the S&P offer dividends, and those that do haven't necessarily maintained an increasing dividend yield for more than 25 years. Investing in an index of these elite and reliable companies, therefore, makes for a smart bet in the long run.
Data source: YCharts.
Like any other stock, Dividend Aristocrats are subject to market change. An argument can be made that such mammoth companies are under more pressure -- and therefore are criticized more for a misstep or underperformance -- because they are hailed as such sustainable and sound investments. Any mistake is recorded, analyzed, and often mentioned on TV, heightening an audience's awareness. For instance, if Coca-Cola makes a bad bet on a new product, the market notices more than if a lesser-known company or one that's only recently gone public makes the same ill-advised judgment call. But it's not all bad for Coca-Cola or for its investors. The company's stock is capable of absorbing mistakes better than a new company can, since it has a proven track record and has likely weathered similar errors in the past.
Dividend aristocrats are therefore good (or, at least, better) bets if you're trying to sift through the noise of a constantly fluctuating market. This isn't to say they're bulletproof, but they are resistant to nuanced daily fluctuations and have been around for generations. And since they've demonstrated a repeated ability to line investors' pockets with a little extra cash -- just for putting their trust (and money) with them -- they enjoy a coveted consumer confidence that few other companies have.
Dividend Kings
Investors have come up with other terms to talk about stocks with even more impressive dividend histories. For instance, Dividend Kings are an exclusive grouping of companies that have raised their dividends for 50 or more years, every single year. That's no small feat when you consider how vastly stocks can fluctuate on a day-to-day basis, let alone year to year. Consider what the market has seen over the past 50 years: global unrest, wars, rising interest rates, falling interest rates, historic highs, lows, 10 presidencies, a technological boom, automation, disruption, disruption, disruption. And somehow, these companies have weathered it all. It's amazing to consider, really. And the list is always changing. It's not easy being king, and very few retain the crown.
As of this year, only 26 companies are considered Dividend Kings. They are:
Source: dripinvesting.org.
Keep in mind that being a Dividend King does not make a company a Dividend Aristocrat. This sounds counterintuitive, since it seems as if companies that managed to double the Dividend Aristocrats' 25-year track record should fit seamlessly into the category. But at least as strictly defined, Dividend Aristocrats belong to the S&P 500 and therefore also must be American-based companies of a certain market cap, whereas Dividend Kings are measured only by their dividend records.
Drawbacks of Dividend Aristocrats
When it comes to the market, everyone has an opinion. And when we're talking about Dividend Aristocrats, even though they may seem too good to be true, many investors see a certain drawback to investing only in stocks that offer such steady dividends.
One common critique of Dividend Aristocrats is that they're unimaginative. Plenty of people say that these payouts are a waste of money, since companies will never see a tangible return from their generosity. Rather than reinvesting extra capital in their own business for something like marketing, research and development, expansion, or other areas of improvement, the common complaint is that these companies just send money out the door without putting it to work for them.
This criticism is somewhat valid; it certainly adds up when a company like PepsiCo regularly gives away almost $4 on every share. But these are huge companies, many of which have been around for more than a century. Sure, Coca-Cola, PepsiCo, and Caterpillar can continue to expand -- at least marginally -- and continue to acquire smaller companies in the name of growth. But on a macro level, most Dividend Aristocrats have already hit their critical mass. How many countries have at least one McDonald's within their borders? (Answer for your next cocktail party: 117 and counting.)
There's still at least marginal room to grow, but these hugely lucrative companies don't need to reinvest each and every penny they make in their businesses to keep their heads above water. Newer companies, disruptors, and less profitable ones do.
It's also worth noting that while offering dividends isn't inherently risky, it does mean that a company repeatedly raising its dividend has a larger target on its back. When companies randomly slash their dividends dramatically with little forewarning (yes, it happens), investors panic, which can drive a stock price down.
Newer companies such as Netflix or Lyft might be exciting, but it's far riskier to overweight your portfolio with relatively untested, high-growth stocks like those than to stick with companies that have slower growth but proven records and steady dividends. Aristocrats, therefore, are slow and safe bets.
So what does it all mean?
Put simply, investing in Dividend Aristocrats is a Foolish (with a capital F!) way to invest! No, filling your portfolio with tons of shares of Johnson & Johnson probably won't make you rich overnight. Overweighting your portfolio with one company would not only be risky, but it would also take the fun and creativity out of investing!
Instead, we suggest doing your homework:
Pick a dozen or so stocks from this list and research them thoroughly.
Use our knowledge center and read about our top 3 dividend stocks to buy this year and hold forever.
Look beyond share prices and past performance.
Sure, this research will provide indicators as to whether purchasing a particular stock is a good idea, but it won't tell the whole story. Take the individual dividend yield percentage into account, consider a company's mission and whether you believe in it, and remember the most important factor to any company's success: its leadership. As we always say, a CEO is the most important key to a business's success in the long run. So if you don't like a company's CEO, board, or long-term vision, consider skipping it altogether.
Adding Dividend Aristocrats to your portfolio and sitting on them for the long haul isn't necessarily foolproof. Market downturns, busts, and recessions can still happen. But Aristocrats will deliver a small amount of steady and reliable income as your portfolio grows (and your companies succeed) over the years. And when the market inevitably corrects or a black-swan event shocks the world (let's hope it doesn't, but it's best to be prepared), you'll be glad you tucked away a few safe bets that bolster your portfolio with a little extra cash for a rainy day.
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Jena Greene has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Netflix. The Motley Fool owns shares of Nordson. The Motley Fool is short shares of Clorox, Colgate-Palmolive, Kimberly-Clark, and Procter & Gamble. The Motley Fool recommends 3M, Aflac, Becton, Dickinson, Cintas, Ecolab, Johnson & Johnson, Lowe's, McCormick, Nucor, Roper Technologies, and Sherwin-Williams. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | These are companies that have been around for decades, perhaps even centuries, and can afford to let go of some of their liquid capital each quarter without needing to immediately reinvest it in the business to fund things like research, development, marketing, or paying off debt. Rather than reinvesting extra capital in their own business for something like marketing, research and development, expansion, or other areas of improvement, the common complaint is that these companies just send money out the door without putting it to work for them. And when the market inevitably corrects or a black-swan event shocks the world (let's hope it doesn't, but it's best to be prepared), you'll be glad you tucked away a few safe bets that bolster your portfolio with a little extra cash for a rainy day. | Millions of investors own stocks that regularly pay out dividends of varying amounts per share, but few are familiar with an elite class of dividend stocks known as Dividend Aristocrats. Why Dividend Aristocrats make strong investments Not just any company is capable of increasing its dividend for 25-plus years. Consider what the market has seen over the past 50 years: global unrest, wars, rising interest rates, falling interest rates, historic highs, lows, 10 presidencies, a technological boom, automation, disruption, disruption, disruption. | Millions of investors own stocks that regularly pay out dividends of varying amounts per share, but few are familiar with an elite class of dividend stocks known as Dividend Aristocrats. In other words, a company doesn't become successful because it offers dividends; a company offers dividends because it is successful. But at least as strictly defined, Dividend Aristocrats belong to the S&P 500 and therefore also must be American-based companies of a certain market cap, whereas Dividend Kings are measured only by their dividend records. | What is a dividend? What are Dividend Aristocrats? But Dividend Aristocrats are different. |
24887.0 | 2019-09-12 00:00:00 UTC | Anxious About AbbVie? Here Are 4 Things You Should Know | ABBV | https://www.nasdaq.com/articles/anxious-about-abbvie-here-are-4-things-you-should-know-2019-09-12 | nan | nan | AbbVie (NYSE: ABBV) went from having a great year in 2017 to having a mediocre one in 2018 to having a downright dismal one so far in 2019. Investors have been worried for years about what would happen when the company's top-selling drug, Humira, faced biosimilar competition. That day has arrived -- and many investors are still worried.
Today, there are even more things investors are concerned about with AbbVie in addition to Humira. If you're among those anxious about AbbVie, here are four things you should know.
Image source: Getty Images.
1. The Allergan acquisition won't be an albatross around AbbVie's neck
Almost immediately after AbbVie announced its plans to acquire Allergan (NYSE: AGN), the deal was heralded as a $63 billion mistake. While I was surprised about AbbVie's decision to buy Allergan, I really don't think it stinks as much as some expect. Actually, my view is that the Allergan acquisition won't be an albatross around AbbVie's neck at all.
The deal makes AbbVie less risky in some ways. Humira will contribute a much lower amount of the company's total revenue after it gobbles up Allergan. AbbVie isn't overpaying for the acquisition. Sure, the company is taking on additional debt to finance the transaction. But I believe AbbVie will be able to pay down between $15 billion and $18 billion within the next couple of years as it is targeting with even more deleveraging after that.
What about Allergan's potential opioid litigation risk? AbbVie CEO Rick Gonzalez stated at this week's Morgan Stanley Global Healthcare Conference that the company looked into this thoroughly before making a decision. Allergan sold off its generic business that included opioid drugs. Gonzalez said that AbbVie's team is "very comfortable" with the protection Allergan has resulting from that divestiture. He also noted that Allergan's market share for its proprietary opioids is relatively low and that the company has "behaved quite responsibly in how they marketed those products."
There have been new developments over the last couple of months related to opioid litigation. However, Gonzalez said that nothing has happened to change AbbVie's comfort level with the Allergan deal. He also noted that while AbbVie's parent company, Abbott Labs, co-promoted Purdue Pharma's Oxycontin in the past, AbbVie has no liability from those efforts.
2. Drug pricing changes probably won't hurt too much
Political wrangling in Washington, D.C. over potential drug pricing changes have also rattled some investors. To be sure, this is a legitimate risk associated with investing in pharmaceutical stocks right now. But I don't think AbbVie shareholders should be overly concerned.
For one thing, AbbVie has already taken steps to reduce its dependence on drug price increases. The company has committed to increasing prices no more than once per year and by only single-digit percentages.
There's also a possibility that changes could even help AbbVie to some extent. For example, Gonzalez expressed his opinion that legislation being reviewed by the U.S. Senate Finance Committee could help alleviate some of the problems for Medicare Part D patients who currently pay sky-high out-of-pocket expenses, particularly for specialty drugs like Humira.
A potential House of Representatives bill leaked on Tuesday could be more problematic for companies like AbbVie. However, judging from the market reaction (AbbVie's shares jumped more than 2% on Tuesday while the broader market fell slightly), I don't think many observers think the House proposals will ultimately be enacted.
3. Imbruvica's dominance looks secure
Imbruvica is a tremendously important component of AbbVie's growth strategy. The blood cancer drug continues to deliver impressive sales growth. AbbVie thinks that Imbruvica, along with Venclexta, gives it a dominant position in the hematology-oncology market.
There have been some concerns, though, that other BTK inhibitors could threaten Imbruvica. Those worries appear to have been overblown.
Rick Gonzalez brought this up during his comments at the Morgan Stanley conference. He said that AbbVie doesn't view a new rival BTK inhibitor as showing differentiation versus Imbruvica. As such, he maintained that the company doesn't view it as a significant competitive threat to Imbruvica.
4. Multiple new drugs on track to be megablockbusters
AbbVie's risk level has decreased considerably, in my view, now that the company has won FDA approvals for both Skyrizi in treating psoriasis and Rinvoq in treating rheumatoid arthritis. Market researcher EvaluatePharma ranked both drugs in its top three new drug launches of 2019.
Skyrizi appears to be off to a great start. Gonzalez stated on Tuesday that the drug is already capturing a significant market share just a few months into its launch. He added that early numbers from the launch for Rinvoq indicate that it will achieve a similar performance to Skyrizi. Gonzalez said that AbbVie remains "absolutely comfortable" with its previous projections that Skyrizi and Rinvoq would deliver combined risk-adjusted sales of more than $10 billion by 2025.
Another drug that AbbVie projected would generate peak sales of $2 billion -- Orilissa -- is getting off to a slower-than-expected start, though. Gonzalez acknowledged that it's been challenging to motivate younger women to make a special visit to their gynecologists to talk about the new treatment for managing endometriosis pain. He also said that gynecologists aren't accustomed to writing prior authorizations, which are required by managed care companies for approval of Orilissa.
But Gonzalez stated that AbbVie is working on ways to address both of these issues. He also thinks that should Orilissa win approval for treating uterine fibroids as anticipated, the issues won't be as big for the new indication. AbbVie continues to believe that Orilissa is a multibillion-dollar product over the long run.
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*Stock Advisor returns as of June 1, 2019
Keith Speights owns shares of AbbVie. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie CEO Rick Gonzalez stated at this week's Morgan Stanley Global Healthcare Conference that the company looked into this thoroughly before making a decision. AbbVie (NYSE: ABBV) went from having a great year in 2017 to having a mediocre one in 2018 to having a downright dismal one so far in 2019. Today, there are even more things investors are concerned about with AbbVie in addition to Humira. | The Allergan acquisition won't be an albatross around AbbVie's neck Almost immediately after AbbVie announced its plans to acquire Allergan (NYSE: AGN), the deal was heralded as a $63 billion mistake. Actually, my view is that the Allergan acquisition won't be an albatross around AbbVie's neck at all. AbbVie (NYSE: ABBV) went from having a great year in 2017 to having a mediocre one in 2018 to having a downright dismal one so far in 2019. | The Allergan acquisition won't be an albatross around AbbVie's neck Almost immediately after AbbVie announced its plans to acquire Allergan (NYSE: AGN), the deal was heralded as a $63 billion mistake. He also noted that while AbbVie's parent company, Abbott Labs, co-promoted Purdue Pharma's Oxycontin in the past, AbbVie has no liability from those efforts. Multiple new drugs on track to be megablockbusters AbbVie's risk level has decreased considerably, in my view, now that the company has won FDA approvals for both Skyrizi in treating psoriasis and Rinvoq in treating rheumatoid arthritis. | Today, there are even more things investors are concerned about with AbbVie in addition to Humira. AbbVie (NYSE: ABBV) went from having a great year in 2017 to having a mediocre one in 2018 to having a downright dismal one so far in 2019. If you're among those anxious about AbbVie, here are four things you should know. |
24888.0 | 2019-09-11 00:00:00 UTC | Noteworthy Wednesday Option Activity: LAD, NEM, ABBV | ABBV | https://www.nasdaq.com/articles/noteworthy-wednesday-option-activity%3A-lad-nem-abbv-2019-09-11 | nan | nan | Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Lithia Motors Inc (Symbol: LAD), where a total volume of 782 contracts has been traded thus far today, a contract volume which is representative of approximately 78,200 underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 41.9% of LAD's average daily trading volume over the past month, of 186,690 shares. Particularly high volume was seen for the $130 strike put option expiring September 20, 2019, with 520 contracts trading so far today, representing approximately 52,000 underlying shares of LAD. Below is a chart showing LAD's trailing twelve month trading history, with the $130 strike highlighted in orange:
Newmont Goldcorp Corp (Symbol: NEM) saw options trading volume of 31,108 contracts, representing approximately 3.1 million underlying shares or approximately 41.5% of NEM's average daily trading volume over the past month, of 7.5 million shares. Especially high volume was seen for the $32.12 strike call option expiring September 20, 2019, with 12,000 contracts trading so far today, representing approximately 1.2 million underlying shares of NEM. Below is a chart showing NEM's trailing twelve month trading history, with the $32.12 strike highlighted in orange:
And AbbVie Inc (Symbol: ABBV) options are showing a volume of 33,328 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 40.7% of ABBV's average daily trading volume over the past month, of 8.2 million shares. Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 2,803 contracts trading so far today, representing approximately 280,300 underlying shares of ABBV. Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange:
For the various different available expirations for LAD options, NEM options, or ABBV options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 2,803 contracts trading so far today, representing approximately 280,300 underlying shares of ABBV. Below is a chart showing NEM's trailing twelve month trading history, with the $32.12 strike highlighted in orange: And AbbVie Inc (Symbol: ABBV) options are showing a volume of 33,328 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 40.7% of ABBV's average daily trading volume over the past month, of 8.2 million shares. | Below is a chart showing NEM's trailing twelve month trading history, with the $32.12 strike highlighted in orange: And AbbVie Inc (Symbol: ABBV) options are showing a volume of 33,328 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 40.7% of ABBV's average daily trading volume over the past month, of 8.2 million shares. Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 2,803 contracts trading so far today, representing approximately 280,300 underlying shares of ABBV. | Below is a chart showing NEM's trailing twelve month trading history, with the $32.12 strike highlighted in orange: And AbbVie Inc (Symbol: ABBV) options are showing a volume of 33,328 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 40.7% of ABBV's average daily trading volume over the past month, of 8.2 million shares. Especially high volume was seen for the $70 strike call option expiring October 18, 2019, with 2,803 contracts trading so far today, representing approximately 280,300 underlying shares of ABBV. | Below is a chart showing ABBV's trailing twelve month trading history, with the $70 strike highlighted in orange: For the various different available expirations for LAD options, NEM options, or ABBV options, visit StockOptionsChannel.com. Below is a chart showing NEM's trailing twelve month trading history, with the $32.12 strike highlighted in orange: And AbbVie Inc (Symbol: ABBV) options are showing a volume of 33,328 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 40.7% of ABBV's average daily trading volume over the past month, of 8.2 million shares. |
24889.0 | 2019-09-10 00:00:00 UTC | Notable ETF Outflow Detected - ACWI, HON, LLY, ABBV | ABBV | https://www.nasdaq.com/articles/notable-etf-outflow-detected-acwi-hon-lly-abbv-2019-09-10 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares MSCI ACWI ETF (Symbol: ACWI) where we have detected an approximate $58.9 million dollar outflow -- that's a 0.5% decrease week over week (from 146,800,000 to 146,000,000). Among the largest underlying components of ACWI, in trading today Honeywell International Inc (Symbol: HON) is down about 1.1%, Lilly (Eli) & Co (Symbol: LLY) is off about 2.1%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.6%. For a complete list of holdings, visit the ACWI Holdings page » The chart below shows the one year price performance of ACWI, versus its 200 day moving average:
Looking at the chart above, ACWI's low point in its 52 week range is $61.01 per share, with $75.06 as the 52 week high point — that compares with a last trade of $73.46. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of ACWI, in trading today Honeywell International Inc (Symbol: HON) is down about 1.1%, Lilly (Eli) & Co (Symbol: LLY) is off about 2.1%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.6%. For a complete list of holdings, visit the ACWI Holdings page » The chart below shows the one year price performance of ACWI, versus its 200 day moving average: Looking at the chart above, ACWI's low point in its 52 week range is $61.01 per share, with $75.06 as the 52 week high point — that compares with a last trade of $73.46. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of ACWI, in trading today Honeywell International Inc (Symbol: HON) is down about 1.1%, Lilly (Eli) & Co (Symbol: LLY) is off about 2.1%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.6%. For a complete list of holdings, visit the ACWI Holdings page » The chart below shows the one year price performance of ACWI, versus its 200 day moving average: Looking at the chart above, ACWI's low point in its 52 week range is $61.01 per share, with $75.06 as the 52 week high point — that compares with a last trade of $73.46. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). | Among the largest underlying components of ACWI, in trading today Honeywell International Inc (Symbol: HON) is down about 1.1%, Lilly (Eli) & Co (Symbol: LLY) is off about 2.1%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares MSCI ACWI ETF (Symbol: ACWI) where we have detected an approximate $58.9 million dollar outflow -- that's a 0.5% decrease week over week (from 146,800,000 to 146,000,000). For a complete list of holdings, visit the ACWI Holdings page » The chart below shows the one year price performance of ACWI, versus its 200 day moving average: Looking at the chart above, ACWI's low point in its 52 week range is $61.01 per share, with $75.06 as the 52 week high point — that compares with a last trade of $73.46. | Among the largest underlying components of ACWI, in trading today Honeywell International Inc (Symbol: HON) is down about 1.1%, Lilly (Eli) & Co (Symbol: LLY) is off about 2.1%, and AbbVie Inc (Symbol: ABBV) is lower by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares MSCI ACWI ETF (Symbol: ACWI) where we have detected an approximate $58.9 million dollar outflow -- that's a 0.5% decrease week over week (from 146,800,000 to 146,000,000). For a complete list of holdings, visit the ACWI Holdings page » The chart below shows the one year price performance of ACWI, versus its 200 day moving average: Looking at the chart above, ACWI's low point in its 52 week range is $61.01 per share, with $75.06 as the 52 week high point — that compares with a last trade of $73.46. |
24890.0 | 2019-09-10 00:00:00 UTC | 10 Healthcare Stocks to Buy Despite the Headlines | ABBV | https://www.nasdaq.com/articles/10-healthcare-stocks-to-buy-despite-the-headlines-2019-09-10 | nan | nan | The past several weeks have been raucous ones for all stocks, but particularly wild ones for healthcare stocks. Not only is the future of the nation’s healthcare market in flux, drug companies are facing an inordinate degree of litigation, and biopharma names have dished out plenty of R&D updates … some good, some bad.
By and large, the bearish market-wide tide and the weakness healthcare stocks have suffered has become something of an opportunity. A handful of these names have become bargains and are ripe for recoveries.
To that end, here’s a rundown of ten healthcare stocks to buy, even if they’re surrounded by bad news and grim headlines. Some are familiar, and others are not. All of them, however, arguably boast more potential than risk at this time, even if not all of them have yet to reach their worst-case-scenario price.
Johnson & Johnson (JNJ)
Source: Sundry Photography / Shutterstock.com
Johnson & Johnson (NYSE:) has arguably faced the worst and most alarming headlines of late, facing not one but two major legal battles.
The first one of course is its liability linked to asbestos contained in its talcum powder sold under the brand name Johnson & Johnson. The other? Some states’ attorneys general are suggesting J&J was culpable for what’s turned into a nationwide opioid addiction epidemic. A closer inspection of both matters reveals the ultimate liability for both may not be as dire as is currently believed.
Though the state of Oklahoma recently won a case that will fine Johnson & Johnson $572 million for allowing opioid abuse to become a “public nuisance,” that figure was , and may point to similarly small figures in other state-level cases.
As for its talcum powder woes, the company is , and losing in others. With the exception of one case in California, the awards granted in cases it has lost have been relatively modest.
AbbVie (ABBV)
Source: Piotr Swat/Shutterstock
AbbVie (NYSE:) shares are down nearly 50% from their early 2018 high, reaching another multi-month low in August.
The underpinnings for that weakness aren’t difficult to deduce. Aside from an increasingly tough battle to defend its patents on breadwinner drug Humira, the Allergan (NYSE:) hasn’t been a particularly popular one with shareholders.
ABBV stock owners have also been disappointed by a couple of major busts on the R&D front. The company’s work in turning Rova-T into a successful lung cancer treatment, for instance, was thrown away when AbbVie after it failed to create meaningful results.
The punishment, so to speak, hasn’t fit the crime though. AbbVie now quietly rates as one of the top healthcare stocks to buy at its now greatly-lowered price thanks to a dividend yield of 6.44% that’s reasonably well protected, and a .
CVS Health (CVS)
Source: Shutterstock
Admittedly, it remains unclear which sliver of the healthcare market will be the one to bear the brunt of any cost-cutting reform. Hospitals and insurers are just as targeted as pharmacy names like CVS Health (NYSE:), which is a key part of the reason CVS stock has been nearly cut in half since the middle of 2015.
That doubt is rooted in a paradigm shift that isn’t likely to happen, however, or at least not as abruptly as some are fearing.
Case in point: Just days after announcing plans to eliminate the rebate enjoyed by pharmacies and pharmacy benefits managers, . Although it’s not clear where the pressure for the reversal came from, clearly someone is in the industry’s corner.
In the meantime, CVS is preparing for all contingencies. It now owns health insurer Aetna and is tiptoeing into the medical device arena. In July the company announced it was beginning trials of an .
Bausch Health Companies (BHC)
Source:
You may recognize the name as one that has specialized in eye care for a long time now. And Bausch — Bausch + Lomb, to be precise — certainly still makes contact lenses and eye-surgery products. This is not the Bausch Health Companies (NYSE:) in question, however. While Bausch Health owns and operates Bausch + Lomb, the Bausch that has earned a spot on a list of healthcare stocks to buy is actually the company formerly known as Valeant Pharmaceuticals.
That name will also ring a bell for most investors … although not a good one. That’s the company that went on an aggressive acquisition spree, planning on buying specialty drugs to then mark their price up to .
In addition to public outcry, congress got involved, ultimately , and forcing new CEO Joseph Papa to rebuild everything the company is, and does.
Surprise! He’s doing it. Though it’s still erratic and somewhat unpredictable, sales are expected to , and 3% next. It’s not much, but it’s enough to drive real earnings growth.
Intercept Pharmaceuticals (ICPT)
Source: Shutterstock
Intercept Pharmaceuticals (NASDAQ:) isn’t an easy name to own. Although the biopharma outfit is driving major sales growth with its chronic liver disease drug Ocaliva, the company’s a one-trick pony that’s still losing money. Last quarter’s top line of $66.3 million — mostly Ocaliva — was up 53% year-over-year, but still let Intercept book an operating loss of $63.6 million and a total net loss of $71.4 million.
In this case though, the company’s fiscal trajectory against the backdrop of an obesity epidemic translates into a bright future. Intercept Pharmaceuticals is also working on a nonalcoholic steatohepatitis (NASH) drug that takes aim at what is expected to be the . That under-served market could be worth $50 billion, if not more, leaving this company amazingly well-positioned for growth.
Pfizer (PFE)
Source: Manuel Esteban/Shutterstock
Stripping out last month’s 20% stumble, Pfizer (NYSE:) has been a pretty good bet in recent years. Thing is, the aspects that have made PFE stock one of the best healthcare stocks to buy for a long while now are still in place. That is, a diverse portfolio that doesn’t lean too much on any one drug. No one product accounts for more than 10% of the company’s total revenue.
The selloff, for the record, was spurred by the decision to s operating as Upjohn to rival Mylan (NASDAQ:). The downside of that exit appears to be fully priced in now though, and then some.
In the meantime, a $500 million investment in a North Carolina manufacturing facility pushes the company deeper into gene therapy waters, which may offer more upside than existing business lines.
PRA Health Sciences (PRAH)
Source: Shutterstock
When investors thinks of healthcare stocks, PRA Health Sciences (NASDAQ:) isn’t a name that generally comes to mind. Indeed, most investors may have never even heard of it.
The one who have heard of it, meanwhile, might be wishing they hadn’t. Even with this year’s choppy rebound effort, shares of the contract research organization are still down 19%.
A bet against PRA Health Sciences hasn’t been a particularly wise bet in the grand scheme of things. Contracted research is a key part of the future of healthcare, as outsourcing R&D becomes the more cost-effective solution.
PRA Health has the numbers to prove it, too. This year’s expected 6.4% revenue growth isn’t jaw-dropping, but it’s reliable, as will be next year’s projected 8.4% top-line growth. Better still, that progress is driving even greater profit growth. Per-share profits are expected to , up from last year’s $4.28, and grow 13% to $5.68 per share next year.
Alexion Pharmaceuticals (ALXN)
Source: Shutterstock
Last week, Alexion Pharmaceuticals (NASDAQ:) shares started what would end up becoming a 14% plunge. The selloff may not be done yet either. The prod? Amgen (NASDAQ:) is challenging Alexion’s patent on Soliris, which is used to treat a trio of rare diseases. It makes up the bulk of Alexion’s sales.
It’s an alarming development, although not one that’s necessarily devastating. Right or wrong, running patent-based interference meant to disrupt other companies is the new norm within the pharmaceuticals arena, and there’s not necessarily any assurance that Amgen will prevail. The chatter that Amgen could still has its merits as well.
In the meantime, the suggests ALXN is priced cheaply enough to survive any profit-sharing agreement that Amgen may end up pursuing instead of an outright legal victory.
Cigna (CI)
While pharmacies and pharmaceuticals are certainly vulnerable to any sweeping overhauls in the way the United States healthcare industry works, it’s not like the insurers are particularly well-shielded. Cigna (NYSE:), for instance, is down more than 30% since its early 2018 high on concerns about insurers’ futures, after they all had a pretty good run between 2013 and 2017.
Not everyone is concerned about one of a myriad of ‘maybes’ that could impact Cigna though.
Alliance Bernstein analyst Lance Wilkes is one of those optimists. He recently upgraded CI stock while it was down, re-rating it at an “Outperform,” “We are increasing our price target and rating on [Cigna] based upon earnings growth driven from deal synergies and its low valuation, which we believe offset our [long term] concerns on policy risks and strategic position.”
CI stock is trading at only , and only 8.2 times next year’s expected profits.
Eli Lilly (LLY)
Source: Shutterstock
Finally, add drugmaker Eli Lilly (NYSE:) to your list of healthcare stocks to buy despite a recent wave of bad news.
For Lilly, that’s mostly been spurred by pipeline and portfolio questions. In March it announced it would launch a, and early this year it decided to acquire Loxo Oncology at an unpopularly frothy premium.
There’s a reason that slide suffered during the first half of the year has started to reverse course beginning in early August. Not only did Lilly win the outcome it wanted in a regarding a collaboration it entered with Adocia to develop rapid-acting insulin, a phase 3 trial of its oral JAK inhibitor Baricitinib as a therapy for atopic dermatitis showed tremendous promise with last month’s update.
They’re little victories that can really add up in investors’ heads.
As of this writing, James Brumley held no position in any of the aforementioned securities. You can learn more about James at his site, , or follow him on Twitter, at @jbrumley.
The post appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (ABBV) Source: Piotr Swat/Shutterstock AbbVie (NYSE:) shares are down nearly 50% from their early 2018 high, reaching another multi-month low in August. ABBV stock owners have also been disappointed by a couple of major busts on the R&D front. The company’s work in turning Rova-T into a successful lung cancer treatment, for instance, was thrown away when AbbVie after it failed to create meaningful results. | AbbVie (ABBV) Source: Piotr Swat/Shutterstock AbbVie (NYSE:) shares are down nearly 50% from their early 2018 high, reaching another multi-month low in August. ABBV stock owners have also been disappointed by a couple of major busts on the R&D front. The company’s work in turning Rova-T into a successful lung cancer treatment, for instance, was thrown away when AbbVie after it failed to create meaningful results. | AbbVie (ABBV) Source: Piotr Swat/Shutterstock AbbVie (NYSE:) shares are down nearly 50% from their early 2018 high, reaching another multi-month low in August. ABBV stock owners have also been disappointed by a couple of major busts on the R&D front. The company’s work in turning Rova-T into a successful lung cancer treatment, for instance, was thrown away when AbbVie after it failed to create meaningful results. | AbbVie (ABBV) Source: Piotr Swat/Shutterstock AbbVie (NYSE:) shares are down nearly 50% from their early 2018 high, reaching another multi-month low in August. ABBV stock owners have also been disappointed by a couple of major busts on the R&D front. The company’s work in turning Rova-T into a successful lung cancer treatment, for instance, was thrown away when AbbVie after it failed to create meaningful results. |
24891.0 | 2019-09-08 00:00:00 UTC | 3 Stocks to Buy With Dividends Yielding More Than 6% | ABBV | https://www.nasdaq.com/articles/3-stocks-to-buy-with-dividends-yielding-more-than-6-2019-09-08 | nan | nan | One definition of yield is to give up something. That definition is important to keep in mind when you're looking at high-yield dividend stocks. Always ask the question: What am I giving up to get that high yield? In some cases, the trade-off of a high-dividend yield is a higher risk that the stock could plunge or that the dividend itself could be in jeopardy.
But there aren't horrible trade-offs with all high-yield stocks. Three stocks I think you can buy right now with dividends yielding more than 6% are AbbVie (NYSE: ABBV), Enterprise Products Partners (NYSE: EPD), and Iron Mountain (NYSE: IRM). Here's what you need to know about these promising income picks.
Image source: Getty Images.
1. AbbVie
AbbVie's dividend currently yields 6.5%. The company earns the distinction of being a Dividend Aristocrat thanks to its years of being part of Abbott Labs. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by an impressive 168%.
To be sure, AbbVie's dividend yield has been inflated by the stock's dismal performance over the last year. Investors have been worried about the future for AbbVie's top-selling drug, Humira, which already faces competition from biosimilars in Europe and will have biosimilar rivals in the larger U.S. market beginning in 2023.
However, AbbVie's valuation is now so low -- shares trade at less than seven times expected earnings -- I think it has a downside cushion. More importantly, the company has plenty of arrows in its quiver to help offset the revenue declines for Humira.
The biggest of those arrows is AbbVie's pending acquisition of Allergan, the maker of blockbuster drug Botox. AbbVie also recently won U.S. regulatory approvals for two new immunology drugs, Rinvoq and Skyrizi, that are expected to be huge winners. Market researcher EvaluatePharma ranked both drugs in its top five new products of 2019. AbbVie's existing drugs Imbruvica, Venclexta, and Orilissa should generate significant growth as well.
2. Enterprise Products Partners
Enterprise Products Partners offers a dividend yield of nearly 6.2%. The company focuses primarily on natural gas, natural gas liquids (NGL), and oil pipelines and storage facilities. These businesses generate a strong cash flow that should allow Enterprise Products Partners to keep the dividends flowing -- and likely growing.
It's encouraging to see a company that can thrive when many of its peers struggle. That's been the case for Enterprise, which has flourished in recent quarters while other midstream oil and gas companies haven't. One key to the company's success has been to slow its dividend distribution growth to fund more expansion projects.
Despite Enterprise's solid stock performance in 2019, the stock is still a bargain. Shares trade at only 12.3 times trailing-12-month earnings and 12.6 times expected earnings.
There's a lot of volatility in the oil and gas industry that could impact Enterprise Products Partners. But with its investments in new projects, the company should be well-positioned for the future.
3. Iron Mountain
Iron Mountain is organized as a real estate investment trust (REIT), which means the company is required to distribute at least 90% of its taxable income to shareholders through dividends. And it's distributed plenty of money to shareholders thanks to strong earnings growth in recent years. Iron Mountain's dividend yield currently stands at a sky-high 7.4%.
The company isn't your typical REIT that focuses on retail, office, or housing properties, though. Iron Mountain reigns as the largest owner of data and records storage facilities in the world. It has also expanded into other types of properties to drive growth such as data centers.
If I could use only one word to describe Iron Mountain's business model, that word would be "solid." Iron Mountain's customer base includes 950 of the Fortune 1000. But it's not just large customers that use the company's storage facilities; Iron Mountain has around 225,000 customers across the world. These customers have little incentive to move their data and records to another provider, so Iron Mountain can count on a steady and reliable revenue stream.
Iron Mountain does face some risks. When interest rates rise significantly, REIT stocks tend to suffer. Iron Mountain has taken on a lot of debt to fund its expansions, so its interest expenses could especially rise if interest rates move higher. But I don't consider these risks overly worrisome. Neither does credit rating agency Moody's, which stated in June that Iron Mountain's "leverage and coverage metrics are considered solid relative to similarly rated companies and REIT peers." Like I said, Iron Mountain is solid.
10 stocks we like better than AbbVie
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Keith Speights owns shares of AbbVie. The Motley Fool owns shares of and recommends Moody's. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie also recently won U.S. regulatory approvals for two new immunology drugs, Rinvoq and Skyrizi, that are expected to be huge winners. Three stocks I think you can buy right now with dividends yielding more than 6% are AbbVie (NYSE: ABBV), Enterprise Products Partners (NYSE: EPD), and Iron Mountain (NYSE: IRM). AbbVie AbbVie's dividend currently yields 6.5%. | Three stocks I think you can buy right now with dividends yielding more than 6% are AbbVie (NYSE: ABBV), Enterprise Products Partners (NYSE: EPD), and Iron Mountain (NYSE: IRM). AbbVie AbbVie's dividend currently yields 6.5%. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by an impressive 168%. | Three stocks I think you can buy right now with dividends yielding more than 6% are AbbVie (NYSE: ABBV), Enterprise Products Partners (NYSE: EPD), and Iron Mountain (NYSE: IRM). AbbVie AbbVie's dividend currently yields 6.5%. Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by an impressive 168%. | AbbVie AbbVie's dividend currently yields 6.5%. Three stocks I think you can buy right now with dividends yielding more than 6% are AbbVie (NYSE: ABBV), Enterprise Products Partners (NYSE: EPD), and Iron Mountain (NYSE: IRM). Since being spun off from Abbott in 2013, AbbVie has boosted its dividend payout by an impressive 168%. |
24892.0 | 2019-09-05 00:00:00 UTC | How Will Johnson & Johnson's Opioid Case Ruling Impact Big Pharma Stocks? | ABBV | https://www.nasdaq.com/articles/how-will-johnson-johnsons-opioid-case-ruling-impact-big-pharma-stocks-2019-09-05 | nan | nan | August 26 might be the single worst day in 2019 for the pharmaceutical industry. An Oklahoma judge found industry giant Johnson & Johnson (NYSE: JNJ) guilty of deceptively marketing its opioid drugs as being non-addictive despite requests from the U.S. Food and Drug Administration to stop. Currently, there are 2,000 more opioid-related lawsuits pending across the country against the company, led both by private parties as well as government officials. While the issue has been gaining ground since the early 2000s, this verdict is expected to be a hallmark case for other drugmakers concerned that further legal actions could be marshaled against them in the near future.
The question pharmaceutical investors need to ask themselves is how big of a deal is this verdict, and which stocks are safe from the potential legal fallout which could ensue in the months and years to come?
Image Source: Getty Images
Breaking down the verdict
Judge Thad Balkman said the prosecutors proved that Johnson & Johnson used a misleading marketing campaign to convince consumers that opioids weren't addictive and were a suitable and safe treatment option for chronic pain. "The increase in opioid addiction and overdose deaths following the parallel increase in opioid sales in Oklahoma was not a coincidence," said Balkman at the ruling.
The key thing to note is that the judge fined Johnson & Johnson $572 million, with the intent that the money be used to help people who are addicted to opioids seek treatment and recover. This amount was far less than the $17.1 billion state prosecutors were demanding and in the end, the ruling was quite mild. The problem wasn't so much that Johnson & Johnson was incorrect in its assertions about opioids being non-addictive. Rather, it came down to the fact that company officials knew about opioids' addictive nature and purposefully danced around the issue in its sales campaigns, even after insistence from the FDA to stop. It was at this point where the company's marketing went from distasteful to illegal, and the ruling was more of a punishment for Johnson & Johnson's unwillingness to change its sales tactics than anything else.
From a financial perspective, the fine is just a drop in the bucket. Johnson & Johnson reported revenues of $81.3 billion in revenue for the 12-months ending on June 30, 2019. Net income during that same period was $16.3 billion. Johnson & Johnson's cash reserves are also healthy with $15.3 billion on the balance sheet. Taking this $572 million hit isn't a huge deal. The real problem is that this ruling opens the door to thousands of other cases across the country. Should Johnson & Johnson lose its appeal of this verdict, a master settlement between all of the other states with claims against the company could be far more impactful. While Johnson & Johnson would have to agree to any such settlement, it's likely that the company would prefer this route to going back to court. Although Oklahoma's ruling was comparatively mild in that it rejected the prosecutors' demands for $17.1 billion, other states could be far more harsh in punishing Johnson & Johnson. Even if only a handful of states agree to fine the company the full amount requested by prosecutors, all these settlements collectively could cost the company tens of billions of dollars, if not hundreds of billions of dollars.
Pharma stocks in danger
While Johnson & Johnson can generally afford these penalty payouts, the real ticking time bomb lies elsewhere. Compared to other opioid manufacturers, Johnson & Johnson was a minor player in making and selling the deadly painkillers. SpecGx, part of Mallinckrodt (NYSE: MNK) and Actavis Pharma (NYSE: AGN) both manufactured more than 25 billion opioid bills between 2006 and 2012 and are collectively responsible for 72.3% of the total opioid market share. Johnson & Johnson doesn't even make the list of top 10 opioid manufacturers:
Data Source: Drug Enforcement Administration data between 2006-2012; The Washington Post
All of the above pharmaceutical companies are now in hot water, as subsequent lawsuits are likely to be on the way following the Johnson & Johnson ruling. Many of these companies are already in dire financial straits and can't afford billion dollar payouts. Privately held Purdue Pharma is already the first casualty, offering between a $10 billion and $12 billion settlement for its opioid lawsuits, leaving the company bankrupt.
McKesson (NYSE: MCK), Mallinckrodt, and Teva (NYSE: TEVA) are also at high risk of going bankrupt should they face similarly large fines. The first two companies are the largest opioid distributor and manufacturer respectively, and when you consider smaller Purdue Pharma's large settlement, it wouldn't be surprising if both companies faced a hundred billion dollar settlement or higher. Teva is in the opposite situation. While much smaller then some of the other companies listed above, Teva's financials have been very unhealthy. In the past quarter, its net income was a loss of $0.69 billion, while its full-year net income was a loss of $4 billion.
Which companies are safe havens from the opioid fallout?
Healthcare investors looking to take new positions should seek pharmaceutical alternatives that aren't involved in the opioid crisis. While the manufacturers listed above are in the danger zone, so too are many companies that distributed opioids. McKesson, Cardinal Health (NYSE: CAH), and CVS (NYSE: CVS) distributed billions of opioid pills between 2006 and 2012 and they are just as likely to come under fire from state prosecutors.
Data Source: Drug Enforcement Administration data between 2006-2012, The Washington Post
Almost any company that isn't a top 10 manufacturers or distributor of opioids will be relatively safe from penalties and lawsuits. One big name in the pharma sector that hasn't been implicated is Merck & Co (NYSE: MRK). Merck has been left out of these major lawsuits due to the fact that it doesn't produce the common opioid medications containing fentanyl and morphine. In fact, the company publicly markets its distance from the opioid business as well as its commitment to charitable causes helping opioid users recover from addiction. AbbVie (NYSE: ABBV) is another major pharmaceutical company that stayed out of the opioid industry for the most part and is a suitable candidate for investors fleeing the endangered pharma industry.
Pharmaceutical companies focused on the animal health market are also suitable alternatives to consider. Zoetis (NYSE: ZTS) is a world leader in this market and has seen its stock outperform the broader industry, gaining 51% so far in 2019 compared to the S&P Pharmaceuticals Select Industry Index, which fell by 5.8% during the same time frame.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (NYSE: ABBV) is another major pharmaceutical company that stayed out of the opioid industry for the most part and is a suitable candidate for investors fleeing the endangered pharma industry. While the issue has been gaining ground since the early 2000s, this verdict is expected to be a hallmark case for other drugmakers concerned that further legal actions could be marshaled against them in the near future. The question pharmaceutical investors need to ask themselves is how big of a deal is this verdict, and which stocks are safe from the potential legal fallout which could ensue in the months and years to come? | AbbVie (NYSE: ABBV) is another major pharmaceutical company that stayed out of the opioid industry for the most part and is a suitable candidate for investors fleeing the endangered pharma industry. Even if only a handful of states agree to fine the company the full amount requested by prosecutors, all these settlements collectively could cost the company tens of billions of dollars, if not hundreds of billions of dollars. Johnson & Johnson doesn't even make the list of top 10 opioid manufacturers: Data Source: Drug Enforcement Administration data between 2006-2012; The Washington Post All of the above pharmaceutical companies are now in hot water, as subsequent lawsuits are likely to be on the way following the Johnson & Johnson ruling. | AbbVie (NYSE: ABBV) is another major pharmaceutical company that stayed out of the opioid industry for the most part and is a suitable candidate for investors fleeing the endangered pharma industry. An Oklahoma judge found industry giant Johnson & Johnson (NYSE: JNJ) guilty of deceptively marketing its opioid drugs as being non-addictive despite requests from the U.S. Food and Drug Administration to stop. Image Source: Getty Images Breaking down the verdict Judge Thad Balkman said the prosecutors proved that Johnson & Johnson used a misleading marketing campaign to convince consumers that opioids weren't addictive and were a suitable and safe treatment option for chronic pain. | AbbVie (NYSE: ABBV) is another major pharmaceutical company that stayed out of the opioid industry for the most part and is a suitable candidate for investors fleeing the endangered pharma industry. The question pharmaceutical investors need to ask themselves is how big of a deal is this verdict, and which stocks are safe from the potential legal fallout which could ensue in the months and years to come? Although Oklahoma's ruling was comparatively mild in that it rejected the prosecutors' demands for $17.1 billion, other states could be far more harsh in punishing Johnson & Johnson. |
24893.0 | 2019-09-05 00:00:00 UTC | 5 Dividend Aristocrats Where Analysts See Capital Gains | ABBV | https://www.nasdaq.com/articles/5-dividend-aristocrats-where-analysts-see-capital-gains-2019-09-05 | nan | nan | To become a "Dividend Aristocrat," a dividend paying company must accomplish an incredible feat: consistently increase shareholder dividends every year for at least 20 consecutive years. Companies with this kind of track record tend to attract a lot of investor attention — and furthermore, "tracking" funds that follow the Dividend Aristocrats Index must own them. With all of this demand for shares, dividend growth stocks can sometimes become "fully priced," where there isn't much upside to analyst targets.
But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. Which means, if the analysts are correct, these are five dividend growth stocks that could produce capital gains in addition to their growing dividend payments.
In the first table below, we present the five stocks. The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented.
The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential:
Another consideration with dividend growth stocks is just how much the dividend is growing. We looked up the trailing twelve months worth of dividends shareholders of each of the above five companies have collected, and then also looked up the same number for the prior trailing twelve months. This gives us a rough yardstick to see how much the dividend has grown, from one trailing twelve month period to another.
These five stocks are part of our full Dividend Aristocrats List. The average analyst target price data upon which this article was based, is courtesy of data provided by Zacks Investment Research via Quandl.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | With all of this demand for shares, dividend growth stocks can sometimes become "fully priced," where there isn't much upside to analyst targets. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential: Another consideration with dividend growth stocks is just how much the dividend is growing. Get the latest Zacks research report on AOS — FREE Get the latest Zacks research report on LOW — FREE Dividend Growth Stocks: 25 Aristocrats » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. Get the latest Zacks research report on AOS — FREE Get the latest Zacks research report on LOW — FREE Dividend Growth Stocks: 25 Aristocrats » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. To ballpark that total return potential, we have added the current yield to the analyst target price upside, in order to arrive at the 12-month total return potential: Another consideration with dividend growth stocks is just how much the dividend is growing. | But we here at ETF Channel have looked through the underlying holdings of the SPDR S&P Dividend ETF (which tracks the S&P High Yield Dividend Aristocrats Index), and found these five dividend growth stocks that actually still have fairly substantial upside to the average analyst target price 12 months out. The recent share price, average analyst 12-month target price, and percentage upside to reach the analyst target are presented. The average 12-month analyst targets are only targets for the share price however, and each of these stocks are expected to pay dividends during that holding period — so the expected total return if these stocks reach their analyst targets is actually the share price upside seen by the analysts plus the dividend yield shareholders can expect. |
24894.0 | 2019-09-04 00:00:00 UTC | 3 Lessons From AbbVie's $5.8 Billion Blunder With Cancer Drug Rova-T | ABBV | https://www.nasdaq.com/articles/3-lessons-from-abbvies-%245.8-billion-blunder-with-cancer-drug-rova-t-2019-09-04 | nan | nan | Turn out the lights. The party's over for Rova-T.
AbbVie (NYSE: ABBV) announced last week that it's completely throwing in the towel on the experimental lung cancer drug after another failure in a late-stage clinical study. The news wasn't a surprise, though: Rova-T was already seen as a lost cause by most observers following the drug's flops last year.
When AbbVie acquired Stemcentrx in 2016 for $5.8 billion to get Rova-T, the company's executives were enthusiastic about the potential for the drug to become a huge blockbuster. But AbbVie wrote off $4 billion of that investment earlier this year and now will have to record another significant impairment charge. There are three important lessons to be learned from AbbVie's big blunder with Rova-T.
Image source: Getty Images.
1. Acquisitions outside a company's core focus are especially iffy
If AbbVie were to scoop up a small biotech focused on immunology drugs, no one would bat an eye. After all, AbbVie arguably claims the most expertise of any drugmaker when it comes to immunology drugs with its enormously successful track record with Humira.
But anytime a drugmaker looks to buy a smaller company outside of its core competency, the prospects of success are especially iffy. Granted, AbbVie has achieved significant success with Imbruvica, the blood cancer drug picked up with its 2015 acquisition of Pharmacyclics. However, in that case, the company had built some level of expertise through its development of another blood cancer drug, Venclexta.
AbbVie didn't have an impressive track record with solid tumors, though, when it acquired Stemcentrx. The deal definitely reflected a big leap for AbbVie and was one the company appears in hindsight to not have had the expertise to adequately evaluate.
2. The riskier the approach, the riskier the deal
Stemcentrx's premise with Rova-T was a controversial one. The biotech's approach was based on the idea that cancerous stem cells could be the root cause of the disease. That idea wasn't widely accepted by cancer researchers. Even shortly after AbbVie acquired Stemcentrx, the small biotech's co-founder and CEO, Brian Slingerland, said in an interview with The Australian Financial Review, "I'm not sure that we have convinced the industry yet."
In addition, AbbVie paid an enormously high price tag to buy Stemcentrx. In September 2015, the privately held biotech was reportedly valued at over $3 billion, a level that MIT Technology Review stated at the time was "a nearly unprecedented value for a company with no revenue, facing the usual R&D obstacles, and that almost no one has heard of."
AbbVie, though, paid $2 billion in cash upfront combined with $3.8 billion in stock for a high-priced small biotech pursuing an approach to fighting solid tumors that many in the industry thought was foolish. The riskier the approach (and the higher the price tag), the riskier the deal. The only good news is that it could have been worse: AbbVie structured the deal where an additional $4 billion would be based on successful achievements of milestones, which ultimately weren't met.
3. The biggest cost of failure is the opportunity cost
There's no question that blowing $5.8 billion is a colossal mistake. But the biggest cost of this failure is the opportunity cost. Imagine what AbbVie might have done instead with that $5.8 billion.
For example, the company could have bought Exelixis in 2015 for less than it spent on Stemcentrx. Exelixis was valued at a little over $1 billion at the time AbbVie announced it was acquiring Stemcentrx and had just announced FDA approval for Cabometyx as a second-line treatment for advanced renal cell carcinoma.
AbbVie could have also gobbled up several other small biotechs that were less pricey and that had late-stage pipeline candidates less risky than Rova-T. Instead, AbbVie rolled the dice -- and lost.
Is an even bigger blunder in the making?
Perhaps the biggest concern now is that AbbVie could be making an even bigger mistake with its pending acquisition of Allergan. AbbVie is again acquiring a company with products outside of its area of expertise. Some of Allergan's products face major competitive challenges. And the $63 billion price tag makes the cost of failure even more severe.
However, unlike Stemcentrx, Allergan has lots of drugs already on the market. The buyout of Allergan isn't an all-or-nothing gamble like AbbVie's acquisition of Stemcentrx was.
But AbbVie's $5.8 billion blunder with Rova-T and its Stemcentrx acquisition underscores the risks associated with investing in biotech stocks. Clinical flops, regulatory failures, and rapidly changing competitive dynamics make the arena challenging for companies -- and investors.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The party's over for Rova-T. AbbVie (NYSE: ABBV) announced last week that it's completely throwing in the towel on the experimental lung cancer drug after another failure in a late-stage clinical study. Even shortly after AbbVie acquired Stemcentrx, the small biotech's co-founder and CEO, Brian Slingerland, said in an interview with The Australian Financial Review, "I'm not sure that we have convinced the industry yet." The only good news is that it could have been worse: AbbVie structured the deal where an additional $4 billion would be based on successful achievements of milestones, which ultimately weren't met. | After all, AbbVie arguably claims the most expertise of any drugmaker when it comes to immunology drugs with its enormously successful track record with Humira. In addition, AbbVie paid an enormously high price tag to buy Stemcentrx. The party's over for Rova-T. AbbVie (NYSE: ABBV) announced last week that it's completely throwing in the towel on the experimental lung cancer drug after another failure in a late-stage clinical study. | When AbbVie acquired Stemcentrx in 2016 for $5.8 billion to get Rova-T, the company's executives were enthusiastic about the potential for the drug to become a huge blockbuster. AbbVie, though, paid $2 billion in cash upfront combined with $3.8 billion in stock for a high-priced small biotech pursuing an approach to fighting solid tumors that many in the industry thought was foolish. But AbbVie's $5.8 billion blunder with Rova-T and its Stemcentrx acquisition underscores the risks associated with investing in biotech stocks. | After all, AbbVie arguably claims the most expertise of any drugmaker when it comes to immunology drugs with its enormously successful track record with Humira. But AbbVie's $5.8 billion blunder with Rova-T and its Stemcentrx acquisition underscores the risks associated with investing in biotech stocks. The party's over for Rova-T. AbbVie (NYSE: ABBV) announced last week that it's completely throwing in the towel on the experimental lung cancer drug after another failure in a late-stage clinical study. |
24895.0 | 2019-09-04 00:00:00 UTC | Nanogold Treatment In The Making For Prostate Cancer | ABBV | https://www.nasdaq.com/articles/nanogold-treatment-in-the-making-for-prostate-cancer-2019-09-04 | nan | nan | (RTTNews) - Prostate cancer is one of the most common cancers in men. Studies have shown that 1 in 9 men on average, is diagnosed with prostate cancer during his lifetime.
A first-in-human trial, which evaluated Nanospectra Biosciences' investigational device AuroLase in men with low-to-intermediate grade tumors within the prostate, has yielded positive results.
The AuroLase therapy involves intravenous administration of laser-excited gold-silica nanoparticles, called AuroShells. These AuroShells get accumulated within the solid tumor tissue when administered and the tumor is illuminated with a near-infrared laser. When exposed to the laser, these nanoparticles were able to ablate tumor tissues in a controlled manner, causing only minimum side effects.
If all goes well as planned, the company hopes to gain FDA clearance for its AuroLase device by the middle of 2021.
Let's take a look at the drugs that passed muster with the FDA in August 2019.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | A first-in-human trial, which evaluated Nanospectra Biosciences' investigational device AuroLase in men with low-to-intermediate grade tumors within the prostate, has yielded positive results. The AuroLase therapy involves intravenous administration of laser-excited gold-silica nanoparticles, called AuroShells. When exposed to the laser, these nanoparticles were able to ablate tumor tissues in a controlled manner, causing only minimum side effects. | (RTTNews) - Prostate cancer is one of the most common cancers in men. Studies have shown that 1 in 9 men on average, is diagnosed with prostate cancer during his lifetime. A first-in-human trial, which evaluated Nanospectra Biosciences' investigational device AuroLase in men with low-to-intermediate grade tumors within the prostate, has yielded positive results. | (RTTNews) - Prostate cancer is one of the most common cancers in men. A first-in-human trial, which evaluated Nanospectra Biosciences' investigational device AuroLase in men with low-to-intermediate grade tumors within the prostate, has yielded positive results. These AuroShells get accumulated within the solid tumor tissue when administered and the tumor is illuminated with a near-infrared laser. | (RTTNews) - Prostate cancer is one of the most common cancers in men. Studies have shown that 1 in 9 men on average, is diagnosed with prostate cancer during his lifetime. A first-in-human trial, which evaluated Nanospectra Biosciences' investigational device AuroLase in men with low-to-intermediate grade tumors within the prostate, has yielded positive results. |
24896.0 | 2019-09-01 00:00:00 UTC | 3 High-Yield Dividend Stocks to Buy on Sale | ABBV | https://www.nasdaq.com/articles/3-high-yield-dividend-stocks-to-buy-on-sale-2019-09-01 | nan | nan | There aren't too many more attractive combinations for income-seeking investors than a high-dividend yield and a bargain price. The bad news is that not many great stocks fit those criteria. The good news, though, is that a few do.
AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Gilead Sciences (NASDAQ: GILD) claim mouthwatering dividend yields and very attractive valuations. Here's what you need to know about these three high-yield dividend stocks that you can buy on sale right now.
Image source: Getty Images.
1. AbbVie
AbbVie's dividend currently yields 6.5%. That fantastic yield isn't the only thing to like about the big drugmaker's dividend. The company has increased its dividend payout by nearly 168% since being spun off from Abbott Labs in 2013. AbbVie remains committed to rewarding shareholders through dividend hikes.
In addition to offering a high-dividend yield, AbbVie stock is dirt cheap. Shares trade at only a little over seven times expected earnings. That's one of the lowest valuations in the pharmaceutical industry and is especially appealing for a company that generated free cash flow of more than $9.8 billion over the last 12 months.
What's the catch? Investors are worried about declining sales for Humira and AbbVie's dependence on the immunology drug. There's also plenty of skepticism about AbbVie's pending $63 billion acquisition of Allergan.
On the other hand, AbbVie recently won an enormously important FDA approval for Rinvoq in treating rheumatoid arthritis. The company scored another victory earlier this year when the FDA approved Skyrizi for treating psoriasis. Both drugs should be megablockbusters for AbbVie and, along with current stars Imbruvica and Venclexta, help the company overcome the challenges resulting from the slipping sales of Humira.
2. AT&T
AT&T continues to rank as one of the premier dividend stocks on the market with a yield of over 5.8%. The telecommunications giant might not give shareholders huge dividend hikes, but it does claim an impressive track record of 35 consecutive years of dividend increases.
Shares currently trade at around 9.6 times expected earnings. That level makes AT&T more attractively valued than several of its peers in the telecom industry.
The company certainly faces some big challenges. AT&T's TV segment has pretty much been a mess, with subscribers bailing on DIRECTV and canceling their HBO subscriptions after the popular Game of Thrones series wrapped up. There's also a huge debt of nearly $160 billion looming like a dark cloud over the company's head.
However, AT&T's business aside from the TV segment appears to be in pretty good shape overall. The company is also steadily paying down its debt. Don't expect tremendous growth from AT&T just yet, but the rise of high-speed 5G wireless networks should provide a boost to the company in the coming years. Most importantly, AT&T should keep those nice dividends flowing.
3. Gilead Sciences
Gilead Sciences doesn't have a long track record of paying dividends -- the company initiated its dividend program just four years ago. But while the big biotech's dividend history is short, it's definitely sweet. Gilead's dividend currently yields 4%, and the company has raised its dividend payout by nearly 47% since 2015.
The stock is also priced at a bargain. Gilead's shares trade at a little over nine times expected earnings. The really good news for the company is that it has returned to revenue and earnings growth after a long decline caused by sinking sales for its hepatitis C franchise.
Gilead hasn't totally emerged from the shadow of its hep-C problems. The biotech has encountered some pipeline setbacks, notably including selonsertib flopping in late-stage studies for treating liver disease nonalcoholic steatohepatitis (NASH). Gilead could also face headwinds associated with investing in any pharmaceutical stock, particularly the threat of the U.S. government imposing limitations on how companies establish drug prices.
Still, though, the future looks brighter now for Gilead than it has looked in quite a while. Gilead has a solid new CEO in Dan O'Day. It could soon win regulatory approvals for potential blockbuster immunology drug filgotinib. The biotech's HIV drugs, especially Biktarvy, continue to perform really well. Gilead's dividend is likely to increase in the future -- and its valuation probably will, too.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Gilead Sciences (NASDAQ: GILD) claim mouthwatering dividend yields and very attractive valuations. AbbVie AbbVie's dividend currently yields 6.5%. AbbVie remains committed to rewarding shareholders through dividend hikes. | AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Gilead Sciences (NASDAQ: GILD) claim mouthwatering dividend yields and very attractive valuations. AbbVie AbbVie's dividend currently yields 6.5%. AbbVie remains committed to rewarding shareholders through dividend hikes. | See the 10 stocks *Stock Advisor returns as of June 1, 2019 Keith Speights owns shares of AbbVie and Gilead Sciences. AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Gilead Sciences (NASDAQ: GILD) claim mouthwatering dividend yields and very attractive valuations. AbbVie AbbVie's dividend currently yields 6.5%. | AbbVie AbbVie's dividend currently yields 6.5%. AbbVie (NYSE: ABBV), AT&T (NYSE: T), and Gilead Sciences (NASDAQ: GILD) claim mouthwatering dividend yields and very attractive valuations. AbbVie remains committed to rewarding shareholders through dividend hikes. |
24897.0 | 2019-08-30 00:00:00 UTC | Notable ETF Outflow Detected - IXJ, ABBV, LLY, CVS | ABBV | https://www.nasdaq.com/articles/notable-etf-outflow-detected-ixj-abbv-lly-cvs-2019-08-30 | nan | nan | Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Global Healthcare ETF (Symbol: IXJ) where we have detected an approximate $42.6 million dollar outflow -- that's a 2.0% decrease week over week (from 34,900,000 to 34,200,000). Among the largest underlying components of IXJ, in trading today AbbVie Inc (Symbol: ABBV) is down about 0.2%, Lilly (Eli) & Co (Symbol: LLY) is up about 0.2%, and CVS Health Corporation (Symbol: CVS) is up by about 0.9%. For a complete list of holdings, visit the IXJ Holdings page » The chart below shows the one year price performance of IXJ, versus its 200 day moving average:
Looking at the chart above, IXJ's low point in its 52 week range is $53.77 per share, with $63.755 as the 52 week high point — that compares with a last trade of $61.03. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among the largest underlying components of IXJ, in trading today AbbVie Inc (Symbol: ABBV) is down about 0.2%, Lilly (Eli) & Co (Symbol: LLY) is up about 0.2%, and CVS Health Corporation (Symbol: CVS) is up by about 0.9%. For a complete list of holdings, visit the IXJ Holdings page » The chart below shows the one year price performance of IXJ, versus its 200 day moving average: Looking at the chart above, IXJ's low point in its 52 week range is $53.77 per share, with $63.755 as the 52 week high point — that compares with a last trade of $61.03. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. | Among the largest underlying components of IXJ, in trading today AbbVie Inc (Symbol: ABBV) is down about 0.2%, Lilly (Eli) & Co (Symbol: LLY) is up about 0.2%, and CVS Health Corporation (Symbol: CVS) is up by about 0.9%. For a complete list of holdings, visit the IXJ Holdings page » The chart below shows the one year price performance of IXJ, versus its 200 day moving average: Looking at the chart above, IXJ's low point in its 52 week range is $53.77 per share, with $63.755 as the 52 week high point — that compares with a last trade of $61.03. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). | Among the largest underlying components of IXJ, in trading today AbbVie Inc (Symbol: ABBV) is down about 0.2%, Lilly (Eli) & Co (Symbol: LLY) is up about 0.2%, and CVS Health Corporation (Symbol: CVS) is up by about 0.9%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Global Healthcare ETF (Symbol: IXJ) where we have detected an approximate $42.6 million dollar outflow -- that's a 2.0% decrease week over week (from 34,900,000 to 34,200,000). For a complete list of holdings, visit the IXJ Holdings page » The chart below shows the one year price performance of IXJ, versus its 200 day moving average: Looking at the chart above, IXJ's low point in its 52 week range is $53.77 per share, with $63.755 as the 52 week high point — that compares with a last trade of $61.03. | Among the largest underlying components of IXJ, in trading today AbbVie Inc (Symbol: ABBV) is down about 0.2%, Lilly (Eli) & Co (Symbol: LLY) is up about 0.2%, and CVS Health Corporation (Symbol: CVS) is up by about 0.9%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Global Healthcare ETF (Symbol: IXJ) where we have detected an approximate $42.6 million dollar outflow -- that's a 2.0% decrease week over week (from 34,900,000 to 34,200,000). For a complete list of holdings, visit the IXJ Holdings page » The chart below shows the one year price performance of IXJ, versus its 200 day moving average: Looking at the chart above, IXJ's low point in its 52 week range is $53.77 per share, with $63.755 as the 52 week high point — that compares with a last trade of $61.03. |
24898.0 | 2019-08-29 00:00:00 UTC | Health Care Sector Update for 08/29/2019: AZN, ABBV, IBIO | ABBV | https://www.nasdaq.com/articles/health-care-sector-update-for-08-29-2019%3A-azn-abbv-ibio-2019-08-29 | nan | nan | Top Health Care Stocks:
JNJ: -0.16%
PFE: +0.47%
ABT: +0.93%
MRK: +0.36%
AMGN: -0.04%
Health care stocks were up broadly, including a 0.8% gain for the NYSE Health Care Index in midday trading. Also, shares of health care companies in the S&P 500 were up 0.8% as a group while the Nasdaq Biotechnology Index was ahead 0.5%.
Among health care stocks moving on news:
(+) AbbVie (ABBV) was edging up 0.3% after it decided to terminate the MERU phase 3 trial evaluating rovalpituzumab tesirine, compared with placebo, as a first-line maintenance therapy for advanced small-cell lung cancer after the drug showed no survival benefit at a pre-planned interim analysis.
In other stock news:
(+) Soliton (SOLY) was rising 5% after saying it is planning a proof of concept clinical trial for the use of its Rapid Acoustic Pulse technology for the treatment of keloid and hypertrophic scars.
(+) Esperion Therapeutics (ESPR) was up 1.7% after it reported positive top-line results from a phase two bempedoic acid and ezetimibe combination tablet study in patients with hypercholesterolemia and type two diabetes.
(-) Can-Fite Biopharma (CANF) was falling 6.4% after saying its net loss per share for the first half was flat at $0.08, while revenue totaled $0.7 million, down from $0.9 million a year earlier.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Among health care stocks moving on news: (+) AbbVie (ABBV) was edging up 0.3% after it decided to terminate the MERU phase 3 trial evaluating rovalpituzumab tesirine, compared with placebo, as a first-line maintenance therapy for advanced small-cell lung cancer after the drug showed no survival benefit at a pre-planned interim analysis. In other stock news: (+) Soliton (SOLY) was rising 5% after saying it is planning a proof of concept clinical trial for the use of its Rapid Acoustic Pulse technology for the treatment of keloid and hypertrophic scars. (+) Esperion Therapeutics (ESPR) was up 1.7% after it reported positive top-line results from a phase two bempedoic acid and ezetimibe combination tablet study in patients with hypercholesterolemia and type two diabetes. | Among health care stocks moving on news: (+) AbbVie (ABBV) was edging up 0.3% after it decided to terminate the MERU phase 3 trial evaluating rovalpituzumab tesirine, compared with placebo, as a first-line maintenance therapy for advanced small-cell lung cancer after the drug showed no survival benefit at a pre-planned interim analysis. Top Health Care Stocks: Health care stocks were up broadly, including a 0.8% gain for the NYSE Health Care Index in midday trading. | Among health care stocks moving on news: (+) AbbVie (ABBV) was edging up 0.3% after it decided to terminate the MERU phase 3 trial evaluating rovalpituzumab tesirine, compared with placebo, as a first-line maintenance therapy for advanced small-cell lung cancer after the drug showed no survival benefit at a pre-planned interim analysis. Health care stocks were up broadly, including a 0.8% gain for the NYSE Health Care Index in midday trading. Also, shares of health care companies in the S&P 500 were up 0.8% as a group while the Nasdaq Biotechnology Index was ahead 0.5%. | Among health care stocks moving on news: (+) AbbVie (ABBV) was edging up 0.3% after it decided to terminate the MERU phase 3 trial evaluating rovalpituzumab tesirine, compared with placebo, as a first-line maintenance therapy for advanced small-cell lung cancer after the drug showed no survival benefit at a pre-planned interim analysis. Health care stocks were up broadly, including a 0.8% gain for the NYSE Health Care Index in midday trading. In other stock news: (+) Soliton (SOLY) was rising 5% after saying it is planning a proof of concept clinical trial for the use of its Rapid Acoustic Pulse technology for the treatment of keloid and hypertrophic scars. |
24899.0 | 2019-08-27 00:00:00 UTC | Why Jim Cramer's Negative Take on Pfizer Is Flat-Out Wrong | ABBV | https://www.nasdaq.com/articles/why-jim-cramers-negative-take-on-pfizer-is-flat-out-wrong-2019-08-27 | nan | nan | I'm not one to bash CNBC Mad Money host Jim Cramer. He's entertaining. He's made some really great calls through the years, notably including his FANG stocks. I thoroughly enjoyed reading Cramer's autobiography, Confessions of a Street Addict, several years ago.
But I think that Jim Cramer's negative take on Pfizer (NYSE: PFE) last week was flat-out wrong. In response to a caller on his show, Cramer stated that Pfizer was "disappointing" and that he would "let it go." Here's what Cramer is missing about Pfizer.
Image source: Getty Images.
Pfizer's pipeline not good enough?
What I found particularly puzzling was Cramer's comment that Pfizer doesn't "have the pipeline that I'd like them to have." Contrast that remark with Pfizer CEO Albert Bourla's statement in the company's quarterly conference call in January that Pfizer had "what we believe is the best pipeline in our history."
Let's look at the facts instead of the two men's opinions. Pfizer's pipeline includes 101 programs in clinical development. Nine of these are currently awaiting regulatory approval. Twenty-three are in late-stage clinical studies. In terms of sheer numbers, you're not going to find many drugmakers with a bigger pipeline than Pfizer's. Granted, quantity doesn't necessarily translate to quality. However, the quality of Pfizer's pipeline looks pretty good to me.
Vyndaqel should be a huge winner in treating rare genetic disease transthyretin familial amyloid polyneuropathy. I think Pfizer's 20-valent pneumococcal conjugate vaccine PF-06482077 that's in late-stage testing should be a tremendous successor to the company's current megablockbuster Prevnar 13. Pfizer should be in great shape to pick up additional indications for its super-successful breast cancer drug Ibrance and prostate cancer drug Xtandi as well.
Pfizer has had a handful of pipeline disappointments this year. Revatio failed to meet the primary endpoint in a late-stage study for treating newborns with persistent pulmonary hypertension (PPHN). Pfizer and Eli Lilly reported mixed results from a late-stage study of non-opioid painkiller tanezumab in treating osteoarthritis (OA) of the hip or knee. Rivipansel failed to meet endpoints in a late-stage study targeting sickle cell disease. But overall, I'd have to side more with Bourla's assessment of Pfizer's pipeline than Cramer's view.
Question-raising comparisons
Cramer said that he preferred two other drug stocks above Pfizer -- Merck (NYSE: MRK) and AbbVie (NYSE: ABBV). I understand why he likes these two stocks, but the picks also raise more questions about his negative take on Pfizer.
In particular, I think that Merck's pipeline is weaker than Pfizer's. Merck has a grand total of six drugs in late-stage development. One of them, vericiguat, wasn't impressive in phase 2 studies for treating heart failure. Most of Merck's pipeline prospects rely on winning additional approvals for existing drugs Keytruda, Lenvima, and Lynparza.
I agree with Cramer that beaten-down AbbVie is a better pick than many investors think. However, AbbVie's biggest challenges for its top-selling drug, Humira, won't come until 2023, when biosimilars hit the U.S. market. Pfizer, meanwhile, should move past the headwinds from generic competition for Lyrica sooner than expected thanks to the planned merger of its Upjohn business unit with Mylan.
My view is that AbbVie's pipeline is also now arguably weaker than Pfizer's. AbbVie won FDA approval earlier this year for Skyrizi in treating psoriasis and more recently for Rinvoq in treating rheumatoid arthritis. Rinvoq is the company's most important immunology win since Humira. But while both Skyrizi and Rinvoq are being evaluated in clinical trials for other indications, AbbVie has already picked up the biggest approvals that it wanted, leaving its pipeline less impressive now.
Cramer vs. Cramer
Probably my biggest knock against Jim Cramer's negative comments about Pfizer last week is that they contradict what he said barely over one month ago. On July 23, Cramer said the following about Pfizer: "I think that that's just the kind of slow-and-steady-wins-the-race stock. I think everyone should have a 'Pfizer' in their portfolio."
Have there been developments for Pfizer that were so bad that Cramer's change in opinion is warranted? Not in my view.
Pfizer did narrowly miss the consensus analysts' revenue estimate in its second-quarter results, but it easily beat Wall Street's Q2 earnings estimate. The company announced the Mylan-Upjohn deal, which I think is a positive move. It completed its acquisition of Array BioPharma and its consumer healthcare joint venture with GlaxoSmithKline, but both of these transaction closes were expected. And, again, I think they were positives for Pfizer.
Jim Cramer was exactly right -- last month but not last week. Pfizer is a "slow-and-steady-wins-the-race stock." Slow and steady is often the best approach to investing in pharmaceutical stocks.
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Keith Speights owns shares of AbbVie and Pfizer. The Motley Fool recommends Mylan. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But while both Skyrizi and Rinvoq are being evaluated in clinical trials for other indications, AbbVie has already picked up the biggest approvals that it wanted, leaving its pipeline less impressive now. Question-raising comparisons Cramer said that he preferred two other drug stocks above Pfizer -- Merck (NYSE: MRK) and AbbVie (NYSE: ABBV). I agree with Cramer that beaten-down AbbVie is a better pick than many investors think. | Question-raising comparisons Cramer said that he preferred two other drug stocks above Pfizer -- Merck (NYSE: MRK) and AbbVie (NYSE: ABBV). I agree with Cramer that beaten-down AbbVie is a better pick than many investors think. However, AbbVie's biggest challenges for its top-selling drug, Humira, won't come until 2023, when biosimilars hit the U.S. market. | Question-raising comparisons Cramer said that he preferred two other drug stocks above Pfizer -- Merck (NYSE: MRK) and AbbVie (NYSE: ABBV). I agree with Cramer that beaten-down AbbVie is a better pick than many investors think. However, AbbVie's biggest challenges for its top-selling drug, Humira, won't come until 2023, when biosimilars hit the U.S. market. | But while both Skyrizi and Rinvoq are being evaluated in clinical trials for other indications, AbbVie has already picked up the biggest approvals that it wanted, leaving its pipeline less impressive now. Question-raising comparisons Cramer said that he preferred two other drug stocks above Pfizer -- Merck (NYSE: MRK) and AbbVie (NYSE: ABBV). I agree with Cramer that beaten-down AbbVie is a better pick than many investors think. |
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