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Opko Health, Inc. Message Board

  • rmsacc rmsacc Sep 24, 2013 5:37 PM Flag

    teva running out of gas...........

    Frost's Opko is being weaned to take up all the slack with a healthy promising pipeline of new compounds.

    the man lives to work...............................

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    • Teva Pharmaceutical (TEVA)

      Frost is also, and conveniently, the Chairman of Teva. This healthcare company has suffered from investor fatigue as a result of struggling momentum in generics. Accordingly, a buyout would help bring back investors and unlock value. The value is, after all, certainly there. In my DCF model on the company, I make several assumptions: (1) 8.5% per annum growth over the next half decade, (2) operating metrics stay at historical levels, (3) a perpetual growth rate of 2.5%, and (4) a discount rate of 9%. Based on these assumptions, I find that the fair value of Teva’s stock $61.33 per share.

      Now, what makes Teva such a critical piece to Frost’s synergistic portfolio is that it can operate as the buyer. Jeremy Levin recently took over as CEO, and he was particularly noted for overseeing takeovers at Bristol Myers (BMY). Given Frost’s joint role in both Teva and PROLOR, I anticipate the former to eventually buyout the latter. But this isn’t the only area where the Billionaire’s portfolio has synergistic overlap…

      See you at the $25 party!

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