TEVA
Teva Pharmaceutical Industries Limited
$32.14
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 16.0% above fair value
You pay
$32.14
Bear
$23.74
Fair
$27.71
Bull
$31.66
Bear
$23.74
-26.1%
$1.57 × 12x P/E
Fair
$27.71
-13.8%
$1.57 × 14x P/E
Bull
$31.66
-1.5%
$1.57 × 16x P/E
Key Value Driver
Normalized P/E multiple (14x base case)
Implied Market Multiple
20.4x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $41.00 from 46 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $27.71 per share.
Warnings
The company's reported profits differ from official accounting profits by 31%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $41.00 (from 46 analysts). Our estimate is 46% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples