TEVA
Teva Pharmaceutical Industries Limited
$34.07
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 25.3% above fair value
You pay
$34.07
Bear
$23.30
Fair
$27.19
Bull
$31.07
Bear
$23.30
-31.6%
$1.57 × 12x P/E
Fair
$27.19
-20.2%
$1.57 × 14x P/E
Bull
$31.07
-8.8%
$1.57 × 16x P/E
Key Value Driver
Normalized P/E multiple (14x base case)
Implied Market Multiple
21.7x
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 $39.29 from 46 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $27.19 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 $39.29 (from 46 analysts). Our estimate is 44% 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