InvestorsObserver gives AbbVie Inc (ABBV) a low valuation score of 13 based on its analysis. The proprietary rating system considers the underlying health of a company by analyzing its stock price, earnings and growth rate. ABBV currently holds a better value than 13% of the shares based on these measures. Long-term buy-and-hold investors should find the valuation ranking system most relevant when making investment decisions.
Metrics analysis
ABBV has a trailing 12-month price-earnings (PE) ratio of 22.1. The historical average of around 15 indicates low value for ABBV’s shares as investors pay higher share prices relative to the company’s earnings. ABBV’s high PE ratio shows that the company has recently traded above its fair market value. Its earnings per share (EPS) over the last 12 months of 6.97 does not justify the current share price. However, rolling PE ratios do not take into account the company’s projected growth rate, resulting in many new companies having high PE ratios due to high growth potential that attracts investors despite insufficient earnings. . ABBV’s 12-month PE-to-Growth (PEG) ratio of 4.33 is considered a bad value as the market overvalues ABBV relative to the company’s expected earnings growth. ABBV’s PEG is derived from its forward price-to-earnings ratio divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and stock price. Due to their incorporation of more fundamentals of a company’s overall health and their focus on the future rather than the past, PEG ratios are one of the most widely used valuation measures by analysts today. today.
Summary
ABBV’s valuation metrics are low at its current price due to an overvalued PEG ratio due to strong growth. ABBV’s PE and PEG are below the market average, resulting in a below-average valuation score. Click here for the full AbbVie Inc (ABBV) stock report.
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