Healthcare
Healthcare
Pharmaceuticals, biotechnology, medical technology
Embedded Files
PUBLIC MARET COVERAGE
AbbVie Inc. (ABBV): Post-Humira thesis priced for execution risk; consensus and SOTP both bracket the dislocation
AbbVie Inc. (ABBV): Post-Humira thesis priced for execution risk; consensus and SOTP both bracket the dislocation
Sector: Healthcare, Biopharmaceuticals
Date: May 15, 2026
Verdict: GO · Fair Value $235 · Entry within $170 to $200, no new buying above $235
Abstract: AbbVie closed at $210.77 on May 14, 20% below the $252 median target of more than forty sell-side analysts, following a first-quarter beat and raise that lifted full-year guidance to $67.3bn of revenue and adjusted earnings per share of $14.08 to $14.28. The central data point is the Skyrizi and Rinvoq trajectory: $4.483bn and $2.119bn respectively in the quarter, together now exceeding Humira's all-time peak, with management stating that consensus peak estimates of $33bn and $16bn will likely be exceeded. The forward multiple of 14.9 times is a 58% discount to Lilly and 32% to Novo Nordisk against a revenue path above 10% and adjusted earnings growth above 40%. The segment-aware sum-of-the-parts base case is $235 with bookends of $175 and $285, and a probability-weighted expected value of $240.80. Aesthetics returned to growth at 5.1% operationally after a 5.9% decline in FY2025, which removes the primary near-term thesis risk. Three thesis-break triggers remain: inclusion of Rinvoq in the 2028 Medicare negotiation round at a price reduction above 50%, an FDA rejection of tavapadon, or Skyrizi biosimilar entry materially before 2033.
Novo Nordisk A/S (NVO): Five-stage capitulation complete, category leader compressed from both sides
Novo Nordisk A/S (NVO): Five-stage capitulation complete, category leader compressed from both sides
Sector: Healthcare, Pharmaceuticals
Date: March 10, 2026
Verdict: AVOID · Target $39.60 · No entry above $42, exit below $32
Abstract: The stock has fallen 60% from its March 2025 high of $91.90 to $37.50 after a cumulative sequence of disappointments: the CagriSema REDEFINE 1 efficacy miss, two guidance cuts attributed to compounded GLP-1 erosion, a chief executive transition and a 9,000-position restructuring, the first negative annual guide in franchise history, the REDEFINE 4 head-to-head failure against tirzepatide, and a voluntary list price reset of 50% on Wegovy and 35% on Ozempic. The franchise now sits between Lilly's Zepbound above, holding 67% of US new prescriptions, and compounded semaglutide at $50 to $200 per month through telehealth and compounding pharmacy networks below. Operating margin compressed from 44.2% in 2024 to 41.3% in 2025 with 36% guided for 2026, and free cash flow guidance implies a like-for-like decline of 22% to 40%. At 11.9 times forward earnings the multiple looks low, but management has pulled forward patent-cliff economics six years before US semaglutide exclusivity expires in 2032. The probability-weighted target implies only 5.6% upside against asymmetric downside. Re-entry requires three conditions together: oral Wegovy running above 100,000 weekly prescriptions, CagriSema approval with label parity, and a demonstrable decline in compounded volume as personalisation-exemption practices come under regulatory pressure.
Page updated
Google Sites
Report abuse