Skip to main content

Market Overview

Citi Bullish On AbbVie As Allergan Deal Provides An Earnings Floor

Share:
Citi Bullish On AbbVie As Allergan Deal Provides An Earnings Floor

AbbVie Inc (NYSE: ABBV) shares are advancing to their highest level since early July following a positive analyst action on the stock.

The Analyst

Citigroup analyst Andrew Baum upgraded shares of AbbVie from Neutral to Buy with a $90 price target, suggesting roughly 25% upside from current levels.

The Thesis

AbbVie will extract significant shareholder value from its proposed Allergan plc (NYSE: AGN) acquisition, given its "industry-leading commercial focus and patient/physician centricity," analyst Baum said.

Even within AbbVie's portfolio, the analyst said he thinks the market is underappreciating the commercial potential of both plaque psoriasis drug Skyrizi and rheumatoid arthritis drug Rinvoq.

The analyst said he expected optimal PBM access, given the sizeable Humira rebate and the company's managed market excellence.

Dispelling Citi's earlier fears over the anticipated impact of biosimilars, the Allergan transaction provides a reasonably secure earnings floor and dividend on which the multiple can expand, the firm said.

The valuation is likely to improve, as Phase 3 readouts and revenue from new drugs kick in, it added.

The Price Action

At last check, AbbVie shares were advancing 2.30% to $73.78.

Related Links
The Daily Biotech Pulse: Enanta Aces Midstage NASH Study, Takeda's Ulcerative Colitis Drug Found Superior To AbbVie's, Decision Day For J&J

Biotech Stock On The Radar: Anavex, A Neurology-Focused Precision Medicine Company

Latest Ratings for ABBV

DateFirmActionFromTo
May 2021BMO CapitalMaintainsOutperform
Mar 2021SVB LeerinkMaintainsOutperform
Feb 2021SVB LeerinkMaintainsOutperform

View More Analyst Ratings for ABBV
View the Latest Analyst Ratings

 

Related Articles (ABBV)

View Comments and Join the Discussion!

Posted-In: Andrew Baum CitigroupAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
FIBKStephens & Co.Downgrades
LEAFCanaccord GenuityDowngrades8.5
AGMSidoti & Co.Downgrades115.0
KEXGabelli & Co.Downgrades
OCGNCantor FitzgeraldDowngrades11.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com