AbbVie Stock on the Move: What Sparked the 6% Jump in the Past Week?

Core Insights - AbbVie (ABBV) shares increased by 6% last week, adding approximately $23.5 billion in market value, driven by positive investor sentiment in the pharmaceutical sector following Pfizer's agreement with the Trump administration [1][9] Industry Overview - Pfizer's deal addresses major concerns in the pharmaceutical sector, including drug pricing and tariffs, by aligning drug prices with those in other developed countries and offering discounts to American consumers through a new federal purchasing platform [2] - Pfizer will receive a three-year exemption from import tariffs on pharmaceutical ingredients, contingent on expanding domestic manufacturing, with plans to invest an additional $70 billion in U.S. operations [3] Investor Sentiment - The announcement has improved the outlook for the pharmaceutical sector, indicating a more cooperative relationship between the Trump administration and major pharmaceutical companies, which could alleviate regulatory and pricing pressures [4] - Other pharmaceutical companies, including AstraZeneca (AZN) and Eli Lilly (LLY), also saw stock price increases of around 16% last week, as investors anticipate similar deals benefiting the sector [6] Company Investments - AbbVie has committed to investing over $10 billion in the U.S. over the next decade, including a recent $70 million investment to enhance bioresearch and manufacturing capabilities at its Worcester, MA facility [5][9] - AstraZeneca plans to invest $50 billion in U.S. manufacturing and R&D by 2030, while Lilly aims to invest $27 billion to develop four new manufacturing sites by 2025 [7] Valuation Metrics - AbbVie shares are trading at a premium compared to the industry, with a price/earnings (P/E) ratio of 16.91, slightly above the industry average of 15.96 and higher than its five-year mean of 13.09 [10]