Harel Finance reiterates Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) its "Buy" recommendation with a target price of $55 (NIS 209), a 24% premium on its current price, ahead of the publication of the company's financial report for the first quarter tomorrow. Analyst Steven Tepper predicts that Teva will report $1.47 earnings per share on $5.73 billion revenue, above the market average of $1.43 earnings per share on $5.51 billion revenue.
Tepper says, "The financial report will likely be strong, reflecting the consolidation of Cephalon in the field of innovative drugs, the consolidation of Taiyo and Teva-Kowa in Japan, and the substantial investments in generic versions in the US, led by Zyprexa (for schizophrenia), Lipitor (for cholesterol), and Lexapro (for depression)." He expects the company to report better than expected sales for all three drugs.
Tepper also expects strong results in generic sales outside the US, thanks to the consolidation of Taiyo and Teva-Kowa in Japan, the addition of some activities of Mepha, and growth in several of Teva's key countries where there is growing demand for generics. This will be partly offset by declines in Western Europe.
Tepper expects strong sales growth from the consolidation of Cephalon and price hikes for its drugs, as well as for Teva's Copaxone and Azilect, increased prescriptions for Azilect and for inhaler's, and Teva's collaboration with Procter & Gamble (NYSE: PG) on non-prescription drugs.
Tepper expects a steady flow of good reports during 2012, together with incoming CEO Dr. Jeremy Levin's exposure to Teva's strategic plans, especially for innovative drugs. Rulings on the Copaxone patent infringement litigation are due within the next two months, which should reduce uncertainty about generic competition in the short term.
Teva's share price rose 0.7% by early afternoon on the TASE today to NIS 169.80, after falling 0.1% on Nasdaq yesterday to $44.39, giving a market cap of $39.2 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on May 8, 2012
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