AbbVie (ABBV) is likely to see continued outperformance despite concerns about the end of the "beat-and-raise" story as investors overlook durable growth, RBC Capital Markets said in a Tuesday research report.

Near-term threats to the sales of the company's immunology drugs, Skyrizi and Rinvoq are "manageable," the analysts said, adding that robust cash generation, a 3% dividend, and and consumer-like durability justify a re-rating.

While the company has closed a few deals recently, there is still M&A capacity of up to $15 billion, which is a strategic flexibility overlooked by the Street, according to the note.

RBC initiated coverage of the stock with an outperform rating and price target of $260 per share.

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