RBC Capital Markets has initiated coverage of AbbVie (ABBV) at outperform saying the company has underperformed based on unfounded concerns and will benefit from growing Skyrizi and Rinvoq sales.
The bank has a $260 price target (~14% upside based on Feb. 24 close).
Analyst Trung Huynh said that others have been wrong about AbbVie in claiming that “the ‘beat-and-raise’ story is over and competition threatens immunology.”
He noted that sales of Skyrizi and Rinvoq are poised to increase given the company is still in “early indication expansion” for the drugs.
Huynh added that AbbVie benefits from no near-term loss of exclusivity issues for its currently marketed medicines and doesn’t need to engage in M&A.
“At <16x, ABBV trades closer to Pharma’s facing large LOEs (MRK) than high growth companies (LLY) when it delivers top-tier c.17% EPS growth (peers 6%)—PEG valuation is more attractive than LLY,” he wrote.
Huynh said that in 2026, Rinvoq has three catalysts, and Skyrizi has two. The FDA is also expected to render a decision on tavapadon for Parkinson’s disease, while AbbVie is slated to release phase 1 data for long-acting amylin analogue ABBV-295 for obesity, and lutikizumab phase 3 data in hidradenitis suppurativa.