An attractively high dividend rate may have AbbVie on income investors' radar, but there are a few things investors should know about this company before they dive in and buy the stock for its dividend payout.
AbbVie Inc. (NYSE:ABBV) investors are being rewarded with an
industry-leading dividend yield of 4.5%. However, patent threats to its
best-selling medicine, Humira, make investing in this dividend-paying
healthcare giant a bit of a gamble. Can AbbVie thwart its patent risk, or will the
company take a big hit?
What's at stake
AbbVie's Humira is the world's best-selling medicine. It's an
autoimmune disease drug that costs tens of thousands of dollars per year and
that's used to treat patients with a range of diseases, including the
blockbuster rheumatoid arthritis and psoriasis indications.
In 2015, widespread global use resulted in Humira sales in excess
of $14 billion, and in Q3, Humira's sales were running at an annualized $16
billion pace. Overall, Humira is solely responsible for 63% of AbbVie's total
revenue, and that's potentially bad news, given that a key Humira patent
expires in December.
Source: The Motley Fool
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