UBS today reiterated its "Buy" recommendation for Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) and target price of $60, following the company's announcement of its joint launch of generic Lipitor with India's Ranbaxy Laboratories Ltd. (BSE: 500359), calling it "good news".
UBS said, "Given that our channel checks had indicated that only Ranbaxy and Watson Pharmaceuticals Inc. (NYSE: WPI) were taking orders a week ago, and given Teva's comments about this product's impact to Teva's fourth quarter, the only "mystery product" that made sense was Lipitor. Hence, we had suspected that Teva must have had a piece of the profits from some type of agreement reached with Ranbaxy. We are still not quite sure what the agreement entails (manufacturing probably), but $0.10 to Teva is about $100 million pretax profits."
The analysts believe that Teva's share will move higher on news, even after the sharp rise a few weeks ago, when the company first mentioned its "mystery product". They conclude, "Teva certainly needs some good news."
Teva's share price rose 3% on Nasdaq yesterday to $39.61, giving a market cap of $35 billion, and rose 2% by mid-afternoon on the TASE today to NIS 151.90.
Published by Globes [online], Israel business news - www.globes-online.com - on December 1, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011