AbbVie vs Eli Lilly Which Outperforms?

AbbVie and Eli Lilly are both leading pharmaceutical companies in the healthcare industry, known for their innovative products and strong financial performance. Investors often compare the two companies' stocks due to their similar market capitalization and revenue streams. AbbVie boasts a diverse product portfolio, including the best-selling drug Humira, while Eli Lilly is known for its strong pipeline of medications and focus on research and development. Understanding the differences and similarities between these two stocks can help investors make informed decisions in their investment strategies.

AbbVie or Eli Lilly?

When comparing AbbVie and Eli Lilly, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between AbbVie and Eli Lilly.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. AbbVie has a dividend yield of 4.44%, while Eli Lilly has a dividend yield of 0.6%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. AbbVie reports a 5-year dividend growth of 10.52% year and a payout ratio of 212.79%. On the other hand, Eli Lilly reports a 5-year dividend growth of 14.97% year and a payout ratio of 54.12%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with AbbVie P/E ratio at 60.35 and Eli Lilly's P/E ratio at 89.61. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. AbbVie P/B ratio is 45.31 while Eli Lilly's P/B ratio is 52.67.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, AbbVie has seen a 5-year revenue growth of 0.45%, while Eli Lilly's is 0.81%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with AbbVie's ROE at 64.09% and Eli Lilly's ROE at 65.15%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $172.70 for AbbVie and $824.62 for Eli Lilly. Over the past year, AbbVie's prices ranged from $136.30 to $207.32, with a yearly change of 52.11%. Eli Lilly's prices fluctuated between $561.65 and $972.53, with a yearly change of 73.16%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.