AbbVie vs. Eli Lilly: Which Star Pharma Stock Is a Better Buy in 2026?

Choosing between AbbVie (NYSE:ABBV) and Eli Lilly and Co (NYSE:LLY) requires weighing established income against explosive growth. Both companies lead the pharmaceutical space, but their paths for 2026 diverge significantly.

AbbVie is transitioning its portfolio to newer immunology drugs after losing exclusivity on its top-selling treatment. Meanwhile, Eli Lilly is seeing massive demand for its weight-loss and diabetes treatments. Investors often compare them because they are giants in the large-cap healthcare space, offering different risk and reward profiles.

The case for AbbVie

According to its latest annual report, filed for the most recent fiscal year, the company commercializes advanced therapies for complex health conditions. The company operates as a prominent player among biotech stocks, focusing on therapies for immunology, oncology, and neuroscience. It distributes products primarily through McKesson Corp (NYSE:MCK), Cardinal Health (NYSE:CAH), and Cencora (NYSE:COR).

Customer concentration like this adds a layer of risk to the business since these three wholesalers account for nearly all U.S. sales. In FY 2025, revenue reached roughly $61.2 billion, representing a growth rate of approximately 9%. Despite this top-line expansion, the company reported a net income of close to $4.3 billion, which reflects a net margin of about 7%.

As of its December 2025 balance sheet, the debt-to-equity ratio was negative 21x, which means total liabilities exceed shareholder equity. The debt-to-equity ratio measures total debt relative to shareholder equity, indicating how a company is financed. The so-called current ratio, which measures the ability to cover short-term liabilities with liquid assets, was roughly 0.7x, while free cash flow reached nearly $17.8 billion.

The case for Eli Lilly and Co.

Eli Lilly researches and markets medicines globally, with a current strategic focus on cardiometabolic health and obesity. It uses a mix of traditional wholesalers like McKesson and its own direct-to-patient digital platform, LillyDirect, to reach patients. Demand for its primary weight-loss and diabetes treatments has turned the company into one of the fastest-growing players in the industry.

In FY 2025, revenue reached nearly $65.2 billion, which marks a significant revenue growth of roughly 45% compared to the prior year. Net income for the period was approximately $20.6 billion, resulting in a strong net margin of about 32%. Net margin shows the percentage of revenue that remains as profit after all operating and non-operating costs are deducted.

The balance sheet as of December 2025 showed a debt-to-equity ratio of close to 1.6x. Lilly's current ratio was approximately 1.6x, suggesting a comfortable level of short-term liquidity for the business. Free cash flow, which represents the cash a business generates after accounting for capital expenditures, was roughly $9 billion for the fiscal year.

Risk profile comparison

AbbVie faces significant revenue concentration, as it relies heavily on Skyrizi and Rinvoq to drive its long-term growth. Pricing pressure is another major factor, as the Inflation Reduction Act impacts government-set prices for drugs like Botox and Vraylar through 2028. Furthermore, the loss of patent protection and the entry of biosimilars threaten its market share in the immunology market.

Eli Lilly deals with intense global competition and pricing pressure on its weight-loss drugs from payers like CVS Health (NYSE:CVS). The company depends on third-party suppliers, particularly those in China, which exposes it to trade disputes and manufacturing disruptions. It also faces the constant challenge of securing and defending patents against rivals like Incyte (NASDAQ:INCY) and Almirall (OTC:LBTSF).

Valuation comparison

Lilly trades at a premium due to its high growth rates, while AbbVie offers a more conservative valuation for value-minded investors.

The Forward P/E ratio relates the stock price to future earnings estimates, while the P/S ratio measures the share price relative to sales over the past twelve months.

Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

Which stock would I buy in 2026?

Eli Lilly is riding a wave of success with its GLP-1 drugs Zepbound for weight loss and Mounjaro, which is the same drug for diabetes control. There is still plenty of growth left in the treatment, and that is expected to power revenue up as high as 30% in 2026, to $85.2 billion, with close to $31 billion in net income. Its next weight-loss drug, Retatrutide, is hotly anticipated for its triple-agonist approach, which is expected to exceed the weight-loss results of Zepbound. The company is also targeting less affluent customers with a lower-cost GLP pill called Foundayo, which it sells directly to consumers.

Besides GLP-1s, Lilly is working on a small interfering RNA therapeutic targeting lipoprotein(a) for the prevention of atherosclerotic cardiovascular disease in patients with elevated lipoprotein(a) levels. Analysts believe it will be a blockbuster ($1 billion or more lifetime revenue) if approved.

AbbVie has a drug pipeline that some on Wall Street believe could include blockbusters (more than $1 billion in lifetime revenue) for treating schizophrenia, Parkinson's disease, psychosis from Alzheimer's, and certain solid tumors.

The company is also buying itself growth with its recent acquisition of Apogee Therapeutics. AbbVie's two relatively new immunology products, Skyrizi and Rinvoq, have proven to be true growth drivers for the business, and investors are hopeful that an FDA decision on a Parkinson's treatment later this year will bode well for the company. The business is expected to see notable growth in net income this year, to $14.6 billion from $4.2 billion. Sales should grow to $67.2 billion.

These are both good healthcare businesses. AbbVie's lower forward P/E and P/S ratios make it a sensible purchase for long-term investors, under the adage of buying good companies at good prices.

Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie, Eli Lilly, and Incyte. The Motley Fool recommends CVS Health and McKesson. The Motley Fool has a disclosure policy.