ABBV
AbbVie Inc.
$264.00
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 87.0% above fair value
You pay
$264.00
Bear
$121.01
Fair
$141.17
Bull
$161.34
Bear
$121.01
-54.2%
$10.08 × 12x P/E
Fair
$141.17
-46.5%
$10.08 × 14x P/E
Bull
$161.34
-38.9%
$10.08 × 16x P/E
Adjust Assumptions
14.0x
10.08$
Key Value Driver
Normalized P/E multiple (14x base case)
Implied Market Multiple
26.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (43 analysts)
$287.08
Divergence from AlphaVal
51%
Summary
Applying a 14x P/E to adjusted EPS of $10.08, the base-case value is $141.17 per share. DDM cross-check: $188.49.
Warnings
The company's reported profits differ from official accounting profits by 325%. Check what costs are being left out of the adjusted number.
The company pays out 292% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Dividend-based valuation: $188.49 (above our primary estimate by 34%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $287.08 (from 43 analysts). Our estimate is 51% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples