AbbVie hikes forecast, tops Street expectations
The drugmaker AbbVie surprised Wall Street on Friday with a third-quarter performance that turned out much better than expected and a new 2014 forecast that also extends well beyond what analysts predict.
Shares of the North Chicago, Illinois, company started climbing before markets opened and after it announced results.
The maker of the Chrohn's disease treatment Humira raised its guidance for the second time this year. It now expects earnings excluding one-time items to range between $3.25 and $3.27 per share in 2014. That's up from its previous forecast for $3.06 to $3.16 per share.
Analysts expect $3.17 per share, on average, according to FactSet.
AbbVie Inc. also reported on Friday adjusted earnings of 89 cents per share in the third quarter.
That trumped average analyst expectations of 78 cents per share, according to Zacks Investment Research.
Humira is the world's top-selling drug. Sales for it climbed 18 percent in the quarter to about $3.3 billion.
Overall, AbbVie earned $506 million, or 31 cents per share, in the quarter that ended Sept. 30. Revenue climbed nearly 8 percent to $5.02 billion.
AbbVie said earlier this month that it would pay a $1.64 billion breakup fee for walking away from its proposed $55 billion takeover of Dublin-based rival Shire PLC after the U.S. company's board withdrew support for the deal. A company spokeswoman said the charge for that will be recorded in the fourth quarter.
The companies had just reached a deal in July after Shire had rejected several unsolicited offers from AbbVie. AbbVie had envisioned buying Shire and reincorporating on the British island of Jersey, where Shire is incorporated. But AbbVie's board had second thoughts after the U.S. government created new limitations on the tax benefits of such overseas incorporations, which are known as inversions.
Shares of AbbVie Inc. climbed 4 percent, or $2.52, to $63.70 in pre-market trading. The stock had climbed nearly 16 percent so far this year, as of Thursday's close, doubling the advance of the Standard & Poor's 500 index.