AbbVie and Novo Nordisk Offer Opposite Kinds of Discount
Novo Nordisk closed at $38.62 and AbbVie at $265.12 on Sept. 24, 2026. One is cheap on earnings and sales; the other carries patent risk but stronger profitability.
Novo Nordisk (NVO) closed at $38.62, up 1.18%, and AbbVie (ABBV) at $265.12, up 0.02%, on Sept. 24, 2026, as investors weighed Novo's discounted earnings and sales multiples against AbbVie's patent-cliff and pricing exposure.
Two of the largest names in prescription drugs are being priced by the market for very different problems. Novo Nordisk A/S (NYSE: NVO) closed at $38.62 on Sept. 24, 2026, up 1.18% on the day and near the top of a $37.92–$38.72 range. AbbVie Inc. (NYSE: ABBV) finished at $265.12, essentially unchanged at +0.02%, after trading between $263.09 and $267.41. Both closes came on a flat session for the broad market: the S&P 500 proxy SPY ended at $767.18, down 0.08%, and the Nasdaq 100 proxy QQQ at $741.10, down 0.01%.
The comparison matters because the two stocks are not offering the same bargain. Novo Nordisk trades at a steep discount on both earnings and sales. AbbVie does not — and is contending with patent cliffs and pricing pressure besides. Yet profitability, as the Motley Fool framed it in its head-to-head, tells a different story from the multiples.
What a discount on earnings and sales actually signals
When a large-cap pharmaceutical company trades cheaply against both its profits and its revenue, the market is usually saying one of two things: either the current revenue line is not durable, or the margin on that revenue is about to compress. A low price-to-sales ratio in particular is a statement about the quality of the top line, not just its size. Investors are refusing to pay full freight for each dollar of Novo Nordisk's sales.
That is a different judgment from the one the market makes about a company with a visible patent expiry. In a patent-cliff case, the loss of exclusivity is a scheduled event. Analysts can model it, management can pre-announce it, and the share price absorbs it over quarters rather than in a single shock. A discount on sales, by contrast, tends to reflect uncertainty about competitive position — whether the revenue base holds at all, and at what price.
Novo's 1.18% gain on an otherwise flat tape is a single day and should not be read as a trend. But it is the kind of move a heavily de-rated stock makes when sentiment stops deteriorating. AbbVie's near-zero change, by contrast, is the signature of a widely held, income-oriented large cap that the market has already settled on.
Patent cliffs and pricing pressure are two separate problems
AbbVie's challenge, per the lead facts, is twofold, and it is worth separating the strands because they behave differently for shareholders.
- Patent cliffs. When exclusivity lapses, generic or biosimilar competitors enter and the branded product's price and volume fall together. The revenue decline is steep but finite. The question for investors is what replaces it and how quickly.
- Pricing pressure. This is structural and applies across the portfolio, not just to the drug losing protection. Payer negotiation, formulary placement and government price-setting mechanisms all compress realized price on products that still have years of patent life left.
A company can grow through a patent cliff if the pipeline delivers. It is much harder to grow through sustained pricing pressure, because the pressure follows the new products too. That is why the market's willingness to pay a higher multiple for AbbVie than for Novo Nordisk rests on something other than the absence of risk. It rests on profitability — the ability to convert whatever revenue survives into earnings at a high rate.
Why margins can outrank the multiple
Profitability is the variable that reconciles the two valuations. A drugmaker with a superior margin structure converts a smaller revenue base into comparable earnings, and it has more room to absorb a price cut before earnings break. That is the defensive property investors pay up for.
The practical test is what happens on the way down. If a payer forces a mid-single-digit price concession, the high-margin business gives up a slice of profit and keeps going. The lower-margin business, especially one whose sales multiple is already depressed because the market doubts the revenue, sees the concession flow straight through to earnings and to the multiple at the same time. That double hit is precisely what a cheap-looking stock is compensating you for.
If a payer forces a mid-single-digit price concession, the high-margin business gives up a slice of profit and keeps going.
None of that makes the discount wrong. It makes it conditional. A buyer of Novo Nordisk at $38.62 is underwriting a view that the competitive threat to its franchise is overstated relative to the price. A buyer of AbbVie at $265.12 is underwriting a view that the company's earnings power survives the expiries and the payer squeeze. Those are not the same bet, and an investor should not pretend the choice is simply between cheap and expensive.
What separates the two positions from here
The variables to watch are specific to each name rather than shared.
- For Novo Nordisk: whether revenue stabilizes. A sales multiple recovers only when the market stops discounting the top line. Prescription trends and competitive share are the evidence that would move it.
- For AbbVie: pipeline conversion and the pace of erosion on products losing exclusivity. The gap between new-product ramp and legacy decline is the whole story.
- For both: the policy backdrop on drug pricing, which does not distinguish between a company with a patent problem and one with a competition problem.
It is also worth noting the market context for the closing prices. With SPY down 0.08% and QQQ down 0.01%, neither stock moved because of index-level flows. The Dow proxy DIA, at $512.68, fell 0.32% — the weakest of the three benchmarks, and a reminder that large-cap defensive and industrial names did not lead the session.
Reading the choice honestly
The temptation with a head-to-head is to declare a winner. The more useful framing is that these two stocks are priced for different failure modes. Novo Nordisk's discount pays you to take competitive risk on a revenue base. AbbVie's premium asks you to trust that a high-margin earnings engine outlasts a set of known expiries and a persistent payer squeeze.
Investors who hold both are, in practice, holding one position hedged against the other: if pricing pressure proves to be the dominant force across the industry, the high-margin business is the safer place to be; if it turns out the market simply over-discounted a franchise that holds its share, the cheaper stock has the larger re-rating available. Neither outcome is visible in a single day's close.
Key facts
- NVO close: $38.62, +1.18%, as of Sept. 24, 2026, 20:00 GMT
- ABBV close: $265.12, +0.02%, as of Sept. 24, 2026, 20:00 GMT
- Valuation gap: Novo Nordisk trades at a steep discount on both earnings and sales
- AbbVie's headwinds: Patent cliffs and pricing pressure, offset by stronger profitability
Frequently asked questions
Where did AbbVie and Novo Nordisk shares close on Sept. 24, 2026?
AbbVie closed at $265.12, up 0.02% on the day, having traded between $263.09 and $267.41. Novo Nordisk closed at $38.62, up 1.18%, within a day range of $37.92 to $38.72. Both closes were recorded as of 20:00 GMT on Sept. 24, 2026, when the market was already shut.
Why is Novo Nordisk considered cheap relative to AbbVie?
Novo Nordisk trades at a steep discount on both earnings and sales multiples. A low price-to-sales ratio in particular signals that investors doubt the durability or quality of the revenue base, not merely its size. The discount compensates buyers for competitive risk rather than reflecting an obviously mispriced asset.
What is a patent cliff and why does it affect AbbVie?
A patent cliff is the sharp revenue drop that occurs when a drug loses market exclusivity and generic or biosimilar rivals enter, cutting both price and volume. AbbVie is contending with patent cliffs alongside broader pricing pressure. Unlike competitive erosion, a cliff is a scheduled event that analysts can model in advance.
How does profitability change the comparison between the two drugmakers?
Profitability determines how much price compression a company can absorb before earnings break. A higher-margin business converts a smaller revenue base into comparable earnings and survives payer concessions with less damage. That defensive quality is what justifies paying a higher multiple for a business carrying known patent expiries.
How did the broader market perform that session?
The session was essentially flat. The S&P 500 proxy SPY closed at $767.18, down 0.08% from a prior close of $767.81. The Nasdaq 100 proxy QQQ finished at $741.10, down 0.01%. The Dow proxy DIA was the weakest at $512.68, down 0.32% on the day.
What should investors watch next in each name?
For Novo Nordisk, the key evidence is whether revenue stabilizes, since a depressed sales multiple only recovers when the market stops discounting the top line. For AbbVie, the variable is pipeline conversion against the pace of erosion on products losing exclusivity. Drug-pricing policy affects both companies regardless.
