AbbVie Stock: Buy, Sell, or Hold in October?

AbbVie (NYSE: ABBV), one of the world's largest pharmaceutical companies, has been a reliable long-term investment. It's raised its dividend annually for 53 consecutive years, making it a Dividend King that has increased its payout for at least 50 years in a row, and a dozen of its drugs generate more than $1 billion in annual revenue. But as the 10-year Treasury yield stays above 5% -- its highest level since 2007 -- is it still smart to buy and hold this dividend stock?

AbbVie's core strengths

In 2023, AbbVie lost its U.S. patent exclusivity for Humira, the blockbuster autoimmune drug that once accounted for over 60% of its sales.

However, it offset that slowdown by launching two new immunology drugs, Skyrizi and Rinvoq, in 2019. It acquired Allergan, the developer of Botox, in 2020, as well as additional companies (including ImmunoGen and Cerevel Therapeutics) to further expand its portfolio.

From 2025 to 2028, analysts expect AbbVie's revenue and adjusted EPS to grow at CAGRs of 9% and 21%, respectively. That growth should be driven by its soaring sales of Skyrizi and Rinvoq, along with its new drugs from ImmunoGen (oncology) and Cervel (neuroscience).

At $264 per share, AbbVie still looks reasonably valued at 16 times next year's earnings, and it pays a decent forward yield of 2.6%. It's not an exciting investment, but I'd rather buy and hold this stock in this turbulent market rather than sell it.

Leo Sun has positions in AbbVie. The Motley Fool has positions in and recommends AbbVie. The Motley Fool has a disclosure policy.