Stock analysts from the US and Israel have raised their estimates on Teva (Nasdaq: TEVA) after the drug maker reported Tuesday that its financial results for the fourth quarter were better than expected.
Credit Suisse First Boston (CSFB) analyst David Maris called Teva’s results “outstanding”, saying they gave good reason for the stock to weather any short-term volatility in the market.
“Teva management is guiding to $1.85 - $1.90 for 2003, significantly higher than our $1.70 estimate, although consensus is currently $1.83. Our target price is currently under review given the likely higher earnings revisions,” said Maris, who rates Teva an “Outperform” with a $42.50 target price.
Maris says macroeconomic trends for generic drug makers are extremely positive. He sees Teva benefiting from a medicare benefit that could include higher utilization of generic drugs.
Israeli broker Nessuah Zannex said today that it had raised its rating on Teva to “Strong Buy” from “Buy”, after upping its EPS target for 2003 to $1.92, above Teva’s new higher forecast range for the year.
Nessuah Zannex analyst Haim Israel said in a research note that the most important issue in Teva’s report was the impressive jump in its drugs pipeline.
Israel noted that Teva's US generic pipeline at the end of the fourth quarter comprised 61 generic drug applications (ANDA’s), with total annual brand sales exceeding $42 billion, worth over 14 times expected revenue in 2003.
The analyst says this is a significant increase from the preceding quarter, when the brand sales of Teva’s generic pipeline were valued at $27 billion, or almost 10 times expected revenue in 2003.
Teva’s Tel Aviv shares were trading unchanged at NIS 180.90 in early afternoon trading on Wednesday. The company’s Nasdaq-listed ADR rose 2.9% on Tuesday to close at $37.20.
Published by Globes [online] - www.globes.co.il - on 19 February, 2003