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Should You Buy AbbVie Stock Hand Over Fist Before July 31?
Key Points
After reporting an earnings beat last quarter, AbbVie could once again beat expectations in the second quarter, although management recently warned about the negative impact of one-time charges.
Shares in the pharmaceutical company have rallied recently, so investors could use any negative aspect of the earnings release as an excuse to take profits.
A post-earnings sell-off could bode well for investors waiting to get in at a more favorable entry point.
Before the market opens on July 31, AbbVie (NYSE: ABBV) will report second-quarter results, hoping to build on the momentum from its Q1 earnings beat. As the key catalyst behind last quarter's performance remains in motion, the same could repeat when second-quarter results hit the Street.
But there could be a problem -- just a few weeks ago, management warned about the negative impact of one-time charges on the upcoming earnings release. Shares have continued to rally despite the warnings, but considering this and other factors, the stock could experience some post-earnings turbulence.
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AbbVie Q2 2026 earnings preview
The latest analyst estimates call for AbbVie to report quarterly earnings of around $3.61 per share, which would be a 21.5% gain from a year ago. This anticipated earnings rebound is not surprising. After all, AbbVie has managed to offset the impact of the loss of patent exclusivity for its flagship drug, Humira, thanks to the success of immunology treatments such as Rinvoq and Skyrizi.
The company is leaning further into immunology, with its pending $10.9 billion acquisition of Apogee Therapeutics, announced last month. Yet while AbbVie may have positives in its corner, don't be shocked if shares pull back after earnings, irrespective of whether earnings meet or beat expectations. AbbVie, one of the most widely followed pharmaceutical stocks, has been on a tear lately. After this recent rally, investors could use any excuse to "sell on the news."
The best approach ahead of earnings
Whether it's a possible earnings miss or simply guidance that fails to exceed the market's rising expectations, there are a few ways this upcoming event could trigger a pullback in AbbVie. However, if you are an existing long-term investor, don't view this as a reason to sell.
Staying put, collecting AbbVie's nearly 2.7% forward dividend, and waiting for AbbVie's immunology pivot to drive further earnings growth remains your best move. As for those who have yet to buy, any post-earnings pullback could create an opportunity to enter a long-term position at a more favorable entry point.
Thomas Niel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie. The Motley Fool has a disclosure policy.