Shares of AbbVie Inc (NYSE: ABBV) took a massive hit in early September after losing exclusivity for Humira – its treatment for rheumatoid arthritis. The stock has since recovered completely, and Wells Fargo says there’s more to come in the coming months.
Mohit Bansal announces a price target of $165
On Thursday, analyst Mohit Bansal assumed coverage of the stock with an “overweight” rating and a price target of $165 that represents a close to 35% upside from here.
The bullish call is based on the pharmaceutical company’s strong growth prospects. According to the Wells Fargo analyst, AbbVie’s business, excluding Humira, is underappreciated. In his note, Bansal wrote:
Our head-to-head analysis suggests that AbbVie’s ex-Humira business is bigger and growing faster than Eli Lilly, but is trading at 15 times estimated 2022 earnings – an over 50% discount to Lilly.
Lebenthal: the pharma space in general is undervalued
AbbVie is up nearly 20% year-to-date, yet Cerity Partners’ Jim Lebenthal is convinced now is a good time to buy this stock. Adding to reasons why investors should own ABBV, he said on CNBC’s “Halftime Report”:
The pharmaceutical space, in general, has laboured under the threat of what drug control provisions will come out of Biden’s Build Back Better bill. That’s a head fake. That bill will be whatever it will be; we’ll get it in a month or two. So, the space, in general, is undervalued.
Lebenthal sees AbbVie as cheap with promising growth potential and “demographics of the developed world”. Other reasons he likes the stock include good dividend yield. In October, AbbVie’s guidance for Q4 EPS came in ahead of Street estimates.
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