On Wednesday, Barclays updated its outlook on shares of AbbVie (NYSE:ABBV), increasing the price target to $195 from $185 while maintaining an Overweight rating. The adjustment reflects the firm's positive expectations for the pharmaceutical company's drug candidate '951, which is anticipated to outperform market estimates.
The analyst from Barclays expressed optimism regarding the upcoming PDUFA (Prescription Drug User Fee Act) decision, suggesting that the market has not fully appreciated its significance. According to their analysis, '951 could generate between $2 billion and $2.5 billion in sales. This projection significantly exceeds the current consensus estimate of $1.1 billion and the company's own guidance of over $1 billion. The anticipated sales figures are attributed to the drug's strong market fit and the unmet medical need it addresses.
The revised price target also takes into account the potential contributions from Elahere, another drug in AbbVie's portfolio, following the completion of the acquisition of its developer, ImmunoGen (NASDAQ:IMGN). The Barclays analyst's comments indicate a belief that the inclusion of Elahere post-acquisition will further bolster AbbVie's financial performance.
Abbvie's stock outlook has been positively adjusted in light of these factors, with the higher price target of $195 reflecting the increased revenue estimates for '951 and the addition of Elahere. The Overweight rating suggests that Barclays expects the stock to outperform the average return of the stocks in the analyst's coverage universe over the next 12 to 18 months.
InvestingPro Insights
AbbVie's (NYSE:ABBV) recent positive outlook from Barclays is supported by a range of financial metrics and market performance indicators. According to InvestingPro, AbbVie boasts a substantial market capitalization of $317.28 billion, signaling its significant presence in the pharmaceutical industry. The company's commitment to shareholder returns is evidenced by its history of raising dividends for 11 consecutive years, coupled with a current dividend yield of 3.46%, which is attractive for income-focused investors.
While AbbVie is trading at a high earnings multiple with a P/E ratio of 24.02 for the last twelve months as of Q1 2023, this may reflect market confidence in its growth prospects, including the anticipated success of drug candidate '951. This optimism is echoed in the InvestingPro Tips, which note that analysts expect net income growth this year and predict profitability. Additionally, the company's stock has experienced a strong return over the last three months, with a 16.8% price total return, and is trading near its 52-week high, indicating robust recent performance.
For investors seeking a deeper analysis, InvestingPro offers additional insights, including 12 more InvestingPro Tips that are relevant to AbbVie's financial health and market position. To further enrich your investment strategy, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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