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Investing.com - UBS raised its price target on Teva Pharma (NYSE:TEVA) to $26.00 from $23.00 while maintaining a Buy rating on the pharmaceutical company. Currently trading at $19.33, Teva appears undervalued according to InvestingPro analysis, which shows the stock has gained over 20% in the past six months.
The price target increase reflects UBS’s updated outlook for Teva’s branded business, with the firm applying a higher price-to-2030 sales multiple of 6.5x, up from the previous 6.0x.
UBS also increased its 2030 sales estimate for Teva to $6.6 billion from $6.3 billion, incorporating potential revenue from DARI (ICS/SABA) beginning in 2028, with adjusted peak sales of $700 million expected in 2032.
The firm believes Teva stock could continue to rally as the Inflation Reduction Act (IRA) price for Austedo gets revealed by November 30 or earlier, noting significant investor concern about potential high Centers for Medicare & Medicaid Services (CMS) discounts.
UBS expects an approximately 40% discount for Austedo in its base case scenario, supported by recent payor checks, rather than the more bearish 60%+ discount feared by some investors.
In other recent news, Teva Pharmaceutical Industries reported its second-quarter earnings per share (EPS) at $0.66, exceeding the forecast of $0.63. However, the company’s revenue of $4.2 billion did not meet the expected $4.28 billion. Additionally, Teva announced the FDA approval and U.S. launch of its generic version of Saxenda, a GLP-1 drug for weight loss, marking a significant development in the weight loss therapy market. The company also presented promising results from its Phase 3 SOLARIS trial for its long-acting injectable olanzapine formulation, which showed no cases of Post-Injection Delirium/Sedation Syndrome (PDSS) through 56 weeks. This safety profile is crucial as it may help the drug avoid monitoring requirements that could hinder its adoption.
In terms of analyst ratings, both Truist Securities and Goldman Sachs reiterated their Buy ratings for Teva, maintaining a price target of $25. Truist Securities’ decision followed a discussion on olanzapine LAI data presented at the recent Psychiatric Congress. Meanwhile, Goldman Sachs highlighted the positive Phase 3 trial data for the olanzapine treatment for schizophrenia. These developments reflect ongoing interest and positive sentiment from analysts regarding Teva’s potential growth and product pipeline.
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