In its 3Q17 earnings conference call, AbbVie (ABBV) raised its fiscal 2017 adjusted diluted EPS (earnings per share) guidance range from $5.44–$5.54 to $5.53–$5.55, which represents a rise of 14.9% based on the midpoint of the range.
The above, however, doesn’t include the $1.26 per share impact arising from multiple one-time events and non-cash amortization. The company has also updated its 2017 GAAP (generally accepted accounting principles) diluted EPS range from $4.55–$4.65 to $4.27–$4.29 to reflect the impact of milestone payments as well as its rapidly advancing Risankizumab research program.
AbbVie has projected its fiscal 2017 gross margin and operating margin to be ~80.5% and ~42.5%, respectively. The company has also projected its fiscal 2017 net interest expenses to be close to $1.0 billion. AbbVie expects its fiscal 2017 effective tax rate to be ~19%.
Notably, AbbVie accounts for 0.67% of the SPDR S&P 500 ETF’s (SPY) total portfolio holdings.
Significant rise in net profit margins
Wall Street analysts have projected that for fiscal 2017, AbbVie will report a net profit margin of ~26.0%, which would mean a YoY growth of ~269 basis points.
AbbVie has projected a 10% YoY top-line rise on an operational basis, with a favorable impact of 2% due to foreign currency fluctuations in 4Q17.
AbbVie has also projected its adjusted EPS (earnings per share) to be in the range of $1.42–$1.44 for 4Q17, which would be a 19.2% rise on a YoY (year-over-year) basis, considering the midpoint of its guidance range. This also involved $0.41 from the impact of non-cash amortization and other one-time events.
In the next part of this series, we’ll discuss Humira’s growth prospects in greater detail.