Why AbbVie Stock Popped While the Market Flopped on Monday

Monday was a grim day for a great many stocks, but luckily for its investors, AbbVie (NYSE: ABBV) wasn't one of them. The storied pharmaceutical company saw its share price rise by almost 4%, on the back of a pair of pre-earnings price target bumps from analysts. The contrast between AbbVie's performance and that of the wider market was stark, as the bellwether S&P 500 (SNPINDEX: ^GSPC) sank by a relatively steep 1.5%.

Doubling up

Well before the market open, news broke of those two AbbVie price target increases. They came at the kickoff of the week, when the company was scheduled to post its fourth-quarter earnings (on Friday, Jan. 31).

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The first came from white-shoe investment bank Goldman Sachs, whose analyst Chris Shibutani bumped his fair value assessment to $208 per share from the previous $205. According to reports, Shibutani actually lowered certain profitability estimates for the company, yet remained bullish on its immunology products such as Skyrizi and Rinvoq.

The second was published by Piper Sandler's Christopher Raymond. He made a slightly more drastic change, upping his AbbVie price target to $227 per share from $220. His reasoning was similar to that of Shibutani. Additionally, according to reports, he believes it is in front of a $3.5 billion noncash, after-tax impairment charge related to its investigational antipsychotic drug emraclidine that hasn't been included in management's guidance.

Pay for quality

AbbVie is one of the better pharmaceutical stocks on the scene, buttressed by a strong product lineup and a promising pipeline of developmental programs. It also pays quite a generous dividend, especially considering that the pharmaceutical sector tends to be miserly in this respect. I think it's always worthy of buy consideration.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie and Goldman Sachs Group. The Motley Fool has a disclosure policy.