Health and Healthcare

Jefferies Top Drug Stocks for the Rest of 2016

Chris Lange

Published: March 15, 2016 9:25 am

Last Updated: January 13, 2020 11:56 am

One key analyst firm is continuing to look at which companies in the health care space are going to return the most in 2016. For the most part, Jefferies maintained its list of top companies in the sector, but it also made a couple additions and updated its price target information and how much upside to expect.

As far as the overall sector is concerned, Jefferies sees strong underlying fundamentals, though somewhat clouded by an overall poor guidance season for 2016 earnings, a light catalyst calendar in the first half of the year, ongoing foreign exchange headwinds for the majority of companies and the overhang around U.S. pricing from the upcoming U.S. presidential election.

AbbVie Inc. (NYSE: ABBV) remains the Top Global Pick at Jefferies, as it sees decent odds for denials of inter partes review (IPR) against AbbVie’s ‘135 patent, which allows it to maintain control of Humira and other biosimilars, and significant valuation upside even on the “worse case” Humira biosimilar scenario. The firm continues to like Novartis A.G. (NYSE: NVS), Pfizer Inc. (NYSE: PFE) and Eli Lilly and Co. (NYSE: LLY). Others, such as Johnson & Johnson (NYSE: JNJ), GlaxoSmithKline PLC (NYSE: GSK), Bristol-Myers Squibb Co. (NYSE: BMY) and Merck & Co. Inc. (NYSE: MRK), remain least preferred names.

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