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Teva Pharmaceutical Industries Ltd. (TEVA) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Teva Pharmaceutical Industries Ltd. (TEVA) closed at $8.03, marking a -1.65% move from the previous day. This move lagged the S&P 500's daily gain of 0.41%. At the same time, the Dow added 0.57%, and the tech-heavy Nasdaq gained 0.7%.

Prior to today's trading, shares of the company had gained 24.77% over the past month. This has outpaced the Medical sector's loss of 0.65% and the S&P 500's gain of 2.04% in that time.

Wall Street will be looking for positivity from TEVA as it approaches its next earnings report date. This is expected to be November 7, 2019. On that day, TEVA is projected to report earnings of $0.60 per share, which would represent a year-over-year decline of 11.76%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.23 billion, down 6.52% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.38 per share and revenue of $17.18 billion, which would represent changes of -18.49% and -8.86%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for TEVA. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.18% higher. TEVA is currently sporting a Zacks Rank of #2 (Buy).

Investors should also note TEVA's current valuation metrics, including its Forward P/E ratio of 3.43. This valuation marks a discount compared to its industry's average Forward P/E of 7.47.

We can also see that TEVA currently has a PEG ratio of 0.81. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. TEVA's industry had an average PEG ratio of 0.9 as of yesterday's close.

The Medical - Generic Drugs industry is part of the Medical sector. This group has a Zacks Industry Rank of 29, putting it in the top 12% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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