AbbVie Stock (NYSE:ABBV)
After suffering a significant setback, AbbVie stock began to recover after SVB Leerink overturned an earlier negative recommendation on the company’s stock. The call had been made based on assertions that the pharma giant is unlikely to provide its 2023 forecast with the results of Q3 2022.
In response to the initial note in which SVB analysts reiterated the Underperform rating and lowered its per share target to $135 from $140, AbbVie stock experienced a drop to an intraday low. The analysts cited, among other things, the impact of Medicare negotiations that followed the Inflation Reduction Act as the reason for their decision.
According to SVB, which cited the management of AbbVie (NYSE:ABBV), the business is not expected to offer 2023 guidance with its Q3 results. It is not confirming its long-term aim of high single-digit sales growth.
The analysts referred to the size of the U.S. patent cliff on ABBV’s best-selling medication Humira and the recessionary/inflationary effect on the company’s aesthetics division as the two primary factors contributing to the big uncertainties leading up to the year 2023.
Nevertheless, in a subsequent note, the analysts recanted their previous statements. They added, concerning the Investor Relations department of AbbVie stock, that “IR indicated that we misread our earlier conversation and that the business did not modify its LT expectation for high single-digit sales growth.”
IR has said that the business, like its competitors, is examining the effect of the Medicare discussions, even though they acknowledge the uncertainties surrounding the negotiations. SVB reaffirms its financial estimates for ABBV and maintains its target price of $140 per share for AbbVie stock.
SVB also claimed that they ignored statements made by management during the results call for the Q2 fiscal quarter. These remarks suggested that it was doubtful that AbbVie (NYSE:ABBV) would offer 2023 guidance during the Q3 call.
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