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Comparing Dividends and Interest Expenses for GILD and ABBV

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Comparing dividend projections

Gilead Sciences (GILD) and AbbVie (ABBV) reported dividends per share of $2.28 and $3.59, respectively, in 2018.

According to Gilead Sciences’ fourth-quarter earnings conference call, the company paid cash dividends worth $3.0 billion and repurchased shares worth $2.9 billion in 2018. In the fourth quarter, the company repurchased 14 million shares worth $962 million. On February 4, 2019, Gilead Sciences issued a press release announcing a dividend of $0.63 per share, a sequential hike of 11% from the first quarter of 2019.

Wall Street analysts expect Gilead Sciences’ dividends per share to be $2.53, $2.74, and $3.00, respectively, in 2019, 2020, and 2021, implying YoY (year-over-year) rises of 10.94%, 8.46%, and 9.50%, respectively.

Wall Street analysts expect AbbVie’s dividends per share to be $4.29, $4.65, and $4.92, respectively, in 2019, 2020, and 2021, implying YoY changes of 19.49%, 8.29%, and 5.82%, respectively.

AbbVie is expected to pay a higher absolute dividend per share than Gilead Sciences from 2019 to 2021.

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Interest expense projections

Analysts expect Gilead Sciences’ interest expenses to be $925.51 million, $975.15 million, and $901.59 million, respectively, in 2019, 2020, and 2021, implying YoY changes of -14.07%, 5.36%, and -7.54%, respectively.

Analysts expect AbbVie’s interest expenses to be $1.1229 billion, $1.0697 billion, and $1.0176 billion, respectively, in 2019, 2020, and 2021, implying YoY changes of -1.85%, -4.74%, and -4.87%, respectively.

According to Gilead Sciences’ fourth-quarter earnings conference call, in 2018, the company repaid debt worth $6.3 billion, the majority of which was related to its acquisition of Kite Pharmaceuticals. At the end of December 2018, Gilead Sciences had adjusted debt worth $27.50 billion on its balance sheet, while the company’s adjusted debt-to-adjusted EBITDA ratio was 2.86x.

Next, we’ll discuss recent and upcoming new product launches and market expansion strategies at Gilead Sciences.

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