On Tuesday, Piper Sandler updated its outlook on shares of AbbVie (NYSE:NYSE:ABBV), raising the price target to $220 from the previous $212, while maintaining an Overweight rating on the stock. The $310.45 billion market cap pharmaceutical company, which InvestingPro data shows maintains a "GOOD" financial health rating, has seen its stock deliver a 15.49% return over the past year.
The revision reflects new projections for the pharmaceutical company's drugs Skyrizi and Rinvoq, which are used to treat ulcerative colitis (UC) and Crohn's disease (CD). With trailing twelve-month revenue of $55.53 billion and analysts generally bullish on the stock (consensus rating 1.93, where 1 is Strong Buy), AbbVie continues to demonstrate strong market presence.
The firm's analyst highlighted that the updated model is based on recent survey work indicating a positive market performance for both Skyrizi and Rinvoq. The analyst anticipates a meaningful increase in market share for the two drugs in the upcoming quarters.
Consequently, the sales estimates for Skyrizi have been increased to $3.6 billion for the fourth quarter of 2024, $14.7 billion for the full year 2025, and $17.2 billion for the full year 2026. Similarly, forecasts for Rinvoq have been adjusted to $1.7 billion for the fourth quarter of 2024, $7.6 billion for the full year 2025, and $9.3 billion for the full year 2026.
These revised estimates are ahead of the consensus for both drugs. The price target adjustment to $220 per share is based on an 18 times multiple of the estimated earnings per share for 2026, which is then discounted back at a rate of 15% per year to the second half of 2025. The analyst maintains the same valuation methodology as before while incorporating the higher revenue projections for AbbVie's key treatments.
Notable for income investors, the company has raised its dividend for 12 consecutive years, currently yielding 3.82%. InvestingPro subscribers can access 8 additional key insights about AbbVie, along with comprehensive financial analysis in the Pro Research Report, available exclusively on the platform.
In other recent news, AbbVie has been making significant strides in its business operations. The pharmaceutical giant recently announced the acquisition of Nimble Therapeutics for $200 million, intending to leverage Nimble's expertise in the development of treatments for serious health conditions. The deal includes Nimble's leading investigational oral peptide IL23R inhibitor, currently in preclinical development for psoriasis.
AbbVie also completed the acquisition of Aliada Therapeutics, adding ALIA-1758, a promising Alzheimer's disease therapy, to its neuroscience pipeline. This move is seen as a strategic step to strengthen AbbVie's position in the neuroscience field.
In terms of financial performance, AbbVie's Q3 revenues reached nearly $14.5 billion, surpassing expectations with an operational growth of 4.9%. The company raised its full-year revenue guidance by $500 million and adjusted EPS guidance to $10.90-$10.94.
Analysts' notes indicate that TD Cowen has named AbbVie as a top pick for 2025, maintaining a positive stance on the pharmaceutical company with a buy stock rating. Leerink Partners also upgraded AbbVie's stock to Outperform, citing strong revenue and earnings per share growth.
Furthermore, AbbVie reported positive results from its Phase 3 TEMPO-2 trial of tavapadon, a potential treatment for early Parkinson's disease. The trial met its primary and key secondary endpoints, demonstrating significant improvement in motor function in patients treated with tavapadon. These are all recent developments that indicate ongoing advancements and growth at AbbVie.
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