Teva Pharmaceutical Industries Limited (NYSE:TEVA) saw a significant share price rise of over 20% in the past couple of months on the NYSE. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Teva Pharmaceutical Industries’s outlook and value based on the most recent financial data to see if the opportunity still exists. View our latest analysis for Teva Pharmaceutical Industries
What is Teva Pharmaceutical Industries worth?
Great news for investors – Teva Pharmaceutical Industries is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $40.77, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Teva Pharmaceutical Industries’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
Can we expect growth from Teva Pharmaceutical Industries?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Teva Pharmaceutical Industries, it is expected to deliver a negative revenue growth of -16.36% over the next couple of years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Although TEVA is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to TEVA, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping tabs on TEVA for some time, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Teva Pharmaceutical Industries. You can find everything you need to know about Teva Pharmaceutical Industries in the latest infographic research report. If you are no longer interested in Teva Pharmaceutical Industries, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.