AbbVie (ABBV) announced that it expects earnings in the range of $4.25 to $4.45 per share for 2015. The midpoint of this guidance range reflects a 33.4% increase over the projected 2014 earnings range of $3.25 to $3.27 per share. The Zacks Consensus Estimate for 2015 is $4.41 per share, on the higher end of the guidance range.
AbbVie expects its blockbuster drug Humira to continue driving revenues going forward. Approval for additional indications could help the product to continue contributing significantly to the top line.
Newly approved hepatitis C virus (HCV) infection drug, Viekira Pak should also boost revenues. We note that Express Scripts (ESRX), a leading pharmacy benefit manager, has updated its National Preferred Formulary, providing access to Viekira Pak as the exclusive option for genotype 1 HCV patients from Jan 1, 2015 (Express Scripts Picks AbbVie's Hepatitis C Drug).
However, the company noted that revenues from some of its older products including testosterone booster AndroGel are expected to decline owing to generic competition.
AbbVie’s pipeline holds significant potential. The company expects several regulatory decisions (including Duopa for advanced Parkinson's disease and Humira for hidradenitis suppurativa) and late-stage drug data (including phase III data on elagolix for endometriosis and elotuzumab for multiple myeloma) to be released in 2015.
We expect investor focus in the near term to remain on the detailed 2015 guidance (including product sales and other financial guidance), which the company plans to reveal on its fourth quarter 2014 earnings conference call, scheduled for Jan 30, 2015.
AbbVie is a Zacks Rank #2 (Buy) stock. Some better-ranked stocks in the health care sector include AMAG Pharmaceuticals, Inc. (AMAG) and Incyte Corporation (INCY). Both stocks carry a Zacks Rank #1 (Strong Buy).
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