AbbVie Stock Rises After FDA Approves 3rd Headache Drug

ABBV is up 23% year-over-year

Deputy Editor
Sep 29, 2021 at 10:02 AM
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The U.S. Food and Drug Administration (FDA) just approved AbbVie Inc's (NYSE:ABBV) migraine prevention treatment, marking the company's third drug in its roster for severe headaches. The once-daily oral migraine medicine, known as Qulipta is one of the drugs acquired by ABBV in its $63 billion deal to buy Allergan that happened last year. 

ABBV was last seen up 0.6% at $107.95, though pressure still looms at the 20-day moving average. The stock has ben trading in a tight channel between its $108 an $106 levels since plummeting from its four-year high of $121.53 in mid-September. The stock has been testing support at its year-to-date breakeven level, though it sports a 23% year-over-year lead. 

Sentiment among analysts remains high, and of the 13 covering ABBV, just three say "hold," compared to 10 "buy" or better ratings. Plus, the 12-month consensus price target of $127.01 is a 17.5% premium to current levels. 

Options traders have also been optimistic. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day call/put volume ratio of 3.59 stands higher than 86% of readings from the past year. This means long calls have rarely been more popular. 

Echoing this, the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.39 is higher than just 4% of readings in its annual range, implying short-term options traders have been much more call-biased than usual. 

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