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Plenty Of Opportunity In AbbVie, Even After Recent Run

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Plenty Of Opportunity In AbbVie, Even After Recent Run

Analysts at Leerink Swann turned bullish on AbbVie Inc (NYSE: ABBV) and sees continued upside to the stock on top of the 43 percent gain since the start of 2017. The firm's Geoffrey Porges upgraded AbbVie's stock rating from Market Perform to Outperform with a new $106 price target.

The bullish outlook for AbbVie stems from a view that AbbVie will hold market exclusivity in the U.S. for its Humira therapy through 2023 after reaching a settlement with Amgen, Inc. (NASDAQ: AMGN) versus a prior estimate of 2020 or 2021, Porges explained (see his track record here). The settlement also calls for a license structure in which Amgen will pay undisclosed royalties, likely until the Humira IP estate expires in the early 2030s.

There is also the possibility of similar positive revisions from some of AbbVie's other late-stage products in its pipeline, including upadacitinib (JAK1), risankizumab (IL-23) and elagolix (GnRH). These are all products that will emerge from phase 3 studies over the next year and could collectively account for $6 billion in sales by 2023.

Looking forward, AbbVie is now projected to generate a 15-percent earnings per share compounded annual growth rate through 2021, which is superior to the top-performing large-cap pharma names at 11 percent.

"This growth horizon, along with the company's increasingly visible late stage pipeline, suggests that AbbVie's stock should continue to re-rate into the range of these large cap biopharma peers," the analyst emphasized.

Related Links:

UBS Downgrades AbbVie; Here's What Changed Analysts' View

Jefferies Strongly Reiterates Top Pick Call On AbbVie

Latest Ratings for ABBV

DateFirmActionFromTo
Nov 2020BMO CapitalInitiates Coverage OnOutperform
Nov 2020BernsteinInitiates Coverage OnOutperform
Nov 2020SVB LeerinkMaintainsOutperform

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