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North Chicago-based Abbvie Incorporated (ABBV) stands as a titan in the global biotechnology landscape, boasting a market cap of $282.9 billion. The company's formidable portfolio is anchored by a suite of groundbreaking drugs, including blockbuster treatments such as Humira, Skyrizi, Rinvoq, Imbruvica, and Venclexta. Abbvie's unparalleled expertise and leadership in various therapeutic areas, from neuroscience and aesthetics to eye care and women's health, cements its position as a prominent industry player, setting it apart from competitors like Amgen Incorporated (AMGN).
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and Abbvie fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the pharmaceutical sector. The pharma giant has achieved a leading position in the market, particularly in the areas of immunology and oncology, through its strong portfolio of products.
Despite its strengths, Abbvie has hit rough waters, with the stock currently down 11.1% from its 52-week high of $182.89, achieved in mid-March. Moreover, shares of ABBV are down 8.4% over the past three months, underperforming the broader S&P 500 Index’s ($SPX) 2.8% returns over the same time frame.
Longer term, ABBV is up 4.7% on a YTD basis, and the stock has soared 18.5% over the past 52 weeks. By contrast, the SPX is up 10.6% in 2024 and 23.2% over the past 52 weeks.
To confirm the bearish price trend, ABBV has been trading below its 50-day and 100-day moving averages, since mid-April.
Abbvie’s drug Humira was the highest-selling pharma product in history, earning nearly $200 billion since its late 2002 U.S. approval. However, since the patent expiration of its blockbuster immunology drug last year, the company has suffered a setback. However, Abbvie has been wise in diversifying its revenue streams through many other successful drugs and strategic acquisitions, expanding its product portfolio.
Recently, Abbvie's CEO and Chief Commercial Officer stated that the company is successfully managing the patent cliff for Humira, with some patients switching to Abbvie's other immunology treatments, Skyrizi and Rinvoq, which have both generated substantial revenue in Q1 2024.
Nonetheless, Abbvie faces headwinds from the Inflation Reduction Act (IRA) of 2022, which aims to lower inflation by enabling Medicare to negotiate drug prices and rebates with manufacturers.
To emphasize the stock’s underperformance, it is worth noting that Abbvie’s top rival, AMGN, continues to outshine ABBV. Shares of Amgen have surged 41% over the past 52 weeks and 6.7% on a YTD basis.
Although Abbvie's stock price has not been particularly impressive, analysts are cautiously optimistic about the stock's prospects. The stock has a consensus rating of “Moderate Buy” from 23 analysts covering it, and the mean price target of $177.52 is a premium of 10.8% to current levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
