Why Investors Should Sell AbbVie And Buy Gilead Sciences

24-06-2014 Seeking AlphaComments (0)

AbbVieGilead SciencesPharmaceutical

AbbVie (ABBV) has put in a flat performance so far this year, but the stock has taken off remarkably in the past two months, gaining 12%. However, with competition from Gilead Sciences (GILD) in the cards, and patents about to expire, will AbbVie be able to sustain its performance going forward? Let's take a look.

A good start

In the recently reported first quarter, AbbVie reported a 5.4% year-over-year increase in revenue to $4.56 billion, exceeding the consensus estimate of $4.32 billion. Also, the company reported an EPS of $0.71, beating the consensus estimate and the year-ago earnings of $0.68 per share. The adjusted gross margin was 78.4%, meeting the estimates, and up 220 basis points from the prior-year quarter.

The first-quarter results were driven by Humira's strong performance, which delivered more than 18% global operational growth. Total global sales delivered by Humira were more than $2.6 billion, up 18.4%

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