Teva Pharma (TEVA): Setting Up For a Rebound - RBC

RBC Capital analyst, Randall Stanicky, reiterated his Outperform rating on Teva Pharma (NYSE: TEVA) along with a price target of $71 after doing a deep dive on Copaxone post diligence calls.

With the Copaxone legal update representing the next major swing factor in value for TEVA, the analyst held calls with the company's SVP, Chief IP Counsel and an external consultant to offer his view on the legal path ahead and NPV exposure. Bottom line, focus is set to shift back to Copaxone where Street expectations are low leaving favorable risk/reward into several near-term updates.

Looking past last week's guidance update there continues to be significant debate in the stock with sentiment generally negative. TEVA addressed the primary bear case last week around outlook when it provided its 2016-19 guidance. The analyst and the Street continues to model generic entry on the 3TW beginning in 2017E leaving meaningful upside should generics not come. There are several legal updates coming in Aug/Sept that should provide directional color into the process and hold potential to deliver positive surprise. Debate in the stock as well as short interest both remain high which creates a favorable near-term set-up.

For an analyst ratings summary and ratings history on Teva Pharma click here. For more ratings news on Teva Pharma click here.

Shares of Teva Pharma closed at $54.21 yesterday.

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