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dvdgege5
May 25, 2018 8:44 AM

ABBV - when having all your eggs in one basket works out Long

AbbVie Inc.NYSE

Description

AbbVie's bread winner is Humira - this drug accounts for the majority of their revenue. However, they did forecast that by 2020, revenue from Humira will be 21B - which is about 75% of their 2017 revenue of 28.22B.

Since AbbVie depends so heavily on their flagship, their stock is fairly volatile, giving this play more of a risk. Consider well-hedged positions (like married puts), or at least ITM leap calls.

Comment

ABBV was downgraded by Credit Suisse, citing concerns over their over-dependency on Humira. This is potentially cause for concern.
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