Abbott Laboratories' remaining business after a spinoff is poised for "exceptional growth," according to a Jefferies analyst.
Jeffrey Holford raised his price target on shares of Abbott Laboratories to $85 from $75 in a research note Wednesday.
The drug and medical device company plans to spin off its pharmaceutical business into a separate company by the end of 2012. The new company, named AbbVie, will focus solely on branded drugs, including the blockbuster anti-inflammatory drug Humira.
The split is meant to free the North Chicago, Ill., company from the risks and obligations of developing innovative pharmaceutical drugs, leaving it with a more predictable business built around nutritional formula, generic drugs and heart stents.
Holford predicted that AbbVie shares would be worth about $55 after the split, and he valued the remaining Abbott business at $30 per share. The company is his top pick for the rest of the year, and its shares could rise on data from clinical trials and other events, he said.
Shares closed at $68.91 on Tuesday and are up 23 percent in 2012.