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In Barclays' View, 2016's Second Half Looks 'Noisy' For AbbVie

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In Barclays' View, 2016's Second Half Looks 'Noisy' For AbbVie

AbbVie Inc (NYSE: ABBV) reported another beat and raise quarter, with the 2Q revenue and EPS beating the consensus expectations.

Barclays’ Geoff Meacham maintains an Equal-Weight rating on the company, with a price target of $68.

Meacham mentioned that while execution remains consistent, 2H16 appears to be “noisy.”

2Q Results

AbbVie reported robust 2Q revenue at $6.4 billion, with EPS of $1.26, beating the consensus forecasts.

Once again, Humira proved to be the primary driver of the results, with both international and U.S. revenues showing upside, although Imbruvica has become the company’s second largest product line and an incrementally crucial part of the revenue trajectory.

Related Link: Investors Cheer AbbVie's Q2 Numbers Forecast

Guidance Raised

AbbVie raised its 2016 guidance, now expecting total revenue to come in at $26 billion, with U.S. Humira expected to grow over 20 percent and international sales growing in the mid-single digits, ex-FX.

The company also raised its EPS guidance range from $4.62–$4.82 to $4.74–$4.83, while guiding to 3Q16 EPS of $1.18–$1.20.

Near-Term Expectations

“While we have high conviction that AbbVie can hit its increased 2016 guidance, we also see likely upcoming headlines related to adalimumab biosimilars and related litigation remaining the focal point over the near term,” Meacham stated.

Although the analyst does not expect a biosimilar competitor to be launched in the near term, further de-risking of the company’s mid-stage pipeline assets and/or business development, which could increase visibility into revenue diversification, were likely to remain key multiple expansion drivers.

The revenue and EPS estimates for 2016 have been raised.

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Latest Ratings for ABBV

DateFirmActionFromTo
Mar 2021SVB LeerinkMaintainsOutperform
Feb 2021SVB LeerinkMaintainsOutperform
Jan 2021Morgan StanleyMaintainsOverweight

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