IBI Investment House Ltd. has published its forecast for Teva Pharmaceutical Industries Ltd.'s (Nasdaq: TEVA; TASE: TEVA) first quarter results. The company is due publish its financials on May 6. IBI has reiterated its "Buy" rating for Teva and its target price of $56, adding that it expects strong results for the first quarter, following a raft of approvals and exclusive launches.
IBI says the issue that will focus most interest in Teva's results is the performance of its subsidiaries and affiliates in the respective geographic sectors, given the weak market in the US as seen in the disappointing results of its counterpart, Sandoz, the second largest generics company in the US. IBS notes, on the other hand, Teva's expansion in Europe, adding that the company's latest acquisitions, CoGenesys Inc. and Bentley Pharmaceuticals Inc. (NYSE: BNT), which will be included in its financials, will also be of interest.
Teva is expected to post $2.4 billion sales, a 17% increase compared with the corresponding quarter in 2006. Sales of Copaxone are seen growing 20% to $447 million for the first quarter, the last in which Teva will record only 50% of the US sales of Copaxone, now that its contract with Aventis has expired.
IBI believes that in the long-term, owing to the weakness of the main pharmaceutical companies, biogenerics will become Teva's principal growth engine, as the company continues its drive to become the leader in this field as well. IBI feels that Teva deserves a premium because of additional assets such as ethical drugs, extensive ethical R&D operations, and its product and geographic diversification, all of which reduce the risks to the company. IBI sees Teva as a defensive holding of a company with a long-term strategy.
Published by Globes [online], Israel business news - www.globes-online.com - on April 29, 2008
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