Subscription: Value Stocks
ABBV - has finally arrived to the target
AbbVie Inc. (AbbVie) is a research-based biopharmaceutical company. The Company is engaged in the discovery, development, manufacture and sale of a range of pharmaceutical products.
You can find the original post on ABBV posted on April 6, 2019 here:
ABBV-4-6-19Back then I wrote that the down structure did not look complete and we should expect continuation of decline to complete wave ( 4 ) down into the Green Target Box located in between of ( 71.40 and 64.50 ). This morning ABBV dropped hard on news of talks about a very expensive acquisition of Allergan (AGN). ABBV is traded at 67.05 currently. I will keep watching it and consider going long if it gets closer to 64.50.
ABBV - Daily chart updated on 6-25-2019
Financial Strength
Financials of the company look amazing. Its Net Margin is strong 16.4%. It does not have a big debt load. It is traded at 9 x Free Cash Flow.
The main problem at this point is that big acquisition of AGN announced today which will significantly increase debt load and dilute all the other ratios.
AGN has much weaker financials. For example, its Net Margin is only 3.3%.
That will be an interesting case. Because form a technical perspective ABBV looks great. On the other hand, the news environment is pretty bad.
However I saw that many times before. A stocks bottoms when bad news hit the wire. And when it is at the bottom and you read the bad news you get a feeling that everything is horrible and the price will decline.
However, the price has already declined! The stock lost 50% of its value since the beginning of 2018.
Operating Margin
20.9
Net
Margin
16.4
Return on Capital
218
Price-to-Free-Cash-Flow
9
Debt-to-Ebitda
0.25
Dividend Yield
5.2
Trading is risky. Read this important Disclaimer
HIGH RISK WARNING
Trading stocks, options, or futures carries a high level of risk, and may not be suitable for all investors. Before deciding to trade, you should carefully consider your objectives, financial situation, needs and level of experience. CastAway Trader LLC provides general overview of trading methods that does not take into account your objectives, financial situation or needs. The content of this website must not be construed as personal advice. The possibility exists that you could sustain a loss in excess of your deposited funds and therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading. You should seek advice from an independent financial advisor. Past performance is not necessarily indicative of future profits.