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Investing.com - Erste Group downgraded AbbVie (NYSE:ABBV), a prominent $407 billion pharmaceutical company, from Buy to Hold on Monday. According to InvestingPro data, the stock has gained over 34% in the past six months and is currently trading near its 52-week high.
The research firm cited AbbVie’s recent reduction in its full-year 2025 adjusted earnings per share guidance as the primary reason for the downgrade. This aligns with InvestingPro data showing that five analysts have recently revised their earnings expectations downward, with the company’s next earnings report due on October 31.
AbbVie lowered its 2025 adjusted earnings per share guidance to a range of $10.38 to $10.58, marking a significant reduction from its previous outlook.
Erste Group noted that the downward revision stems from a required writeoff of research and development costs totaling $2.7 billion in the third quarter.
The pharmaceutical company’s guidance adjustment and subsequent rating downgrade come as AbbVie navigates challenges in its R&D portfolio that necessitated the substantial writeoff.
In other recent news, AbbVie announced that the U.S. Food and Drug Administration has approved an updated indication for its drug RINVOQ, now allowing it to be prescribed for adults with moderately to severely active ulcerative colitis and Crohn’s disease who have received at least one approved systemic therapy. This comes as the company also reported successful results from its Phase 2 trial evaluating onabotulinumtoxinA (BOTOX) for upper limb essential tremor, with the trial meeting its primary endpoint. In financial developments, AbbVie updated its 2025 earnings guidance to reflect a $2.7 billion expense related to in-process research and development, which is expected to negatively impact earnings per share by $1.50.
Analyst activity includes Piper Sandler raising its price target for AbbVie to $284, citing strong performance across its commercial portfolio, while Cantor Fitzgerald increased its target to $250, attributing the decision to Skyrizi’s strong performance, which exceeded consensus estimates by $51 million. These developments highlight the company’s ongoing strategic adjustments and clinical advancements. Despite the anticipated financial impact from the IPR&D expense, analysts maintain an Overweight rating on AbbVie’s stock, suggesting continued confidence in its portfolio.
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