Teva Pharmaceutical Industries Ltd (TEVA) Stock Analysis and Metrics

Teva Pharmaceutical Industries

NYSE: TEVA

$30.84 ▼ -0.34 (-1.09%)

At close: Jul 24, 2026 · 3:59 PM UTC

Financial Ratios

Market Cap35.75 Bn

P/E23.02

P/S2.06

Div. Yield0.00

ROIC (Qtr)0.01

Total Debt (Qtr)16.63 Bn

Revenue Growth (1y) (Qtr)2.34

Add ratio to table…

About

Teva Pharmaceutical Industries Ltd is a biopharmaceutical company that combines a strong generics business with innovative medicines biosimilars and over the counter products. The firm develops manufactures and sells a wide range of pharmaceuticals including generic prescription drugs biosimilar biologics and patented treatments across neuroscience immunology respiratory and oncology therapeutic areas. Headquartered in Israel Teva maintains a significant presence in the United States Europe and many other markets worldwide and operates through a global network of approximately 34000 employees across 57 countries. The company was incorporated in Israel on February 13 1944 and traces its origins to enterprises established as early as 1901. Today Teva serves patients and healthcare providers by offering affordable treatment options and innovative therapies that address unmet medical needs.

Teva generates revenue primarily through the sale of generic medicines biosimilar products innovative medicines over the counter items and related services. Its generic portfolio includes oral solids injectables inhalants liquids transdermal patches and creams that are marketed to retail drug chains mail order distributors wholesalers and pharmacies. The biosimilar business offers alternatives to reference biologics such as rituximab trastuzumab and other monoclonal antibodies and is sold to hospitals clinics and specialty care providers. Innovative medicines such as AUSTEDO AJOVY UZEDY and COPAXONE generate revenue through prescriptions for neurological respiratory and oncological indications and are distributed via similar channels. Over the counter products like SUDOCREM and regional brands are sold through retail outlets and pharmacy chains. In addition the company derives income from the sale of active pharmaceutical ingredients to third parties contract manufacturing arrangements and an out licensing platform through its affiliate Medis which offers a portfolio of products to other pharmaceutical firms.

Teva holds a leading position in the global generics market often ranking among the top three suppliers in numerous countries including the United States and several European nations. Its competitive advantages stem from a broad product portfolio integrated research and development capabilities and a worldwide manufacturing and commercial footprint that enables rapid response to market demands. In the biosimilar arena Teva competes with established players such as Sandoz Amgen and Pfizer while leveraging its experience in complex biologics and strategic partnerships to expand its pipeline. Within innovative medicines the company faces competition from both large pharmaceutical firms and generic entrants but maintains differentiation through patented therapies patient support programs and a focus on high unmet need areas such as movement disorders and migraine. Overall Teva’s scale diversified therapeutic focus and commitment to pipeline optimization provide a solid foundation for sustained market relevance.

The company’s customer base consists of retail pharmacies hospital pharmacies wholesalers managed care organizations and government health programs. In the United States major customers include large drug store chains mail order distributors and wholesale drug distributors. In Europe and international markets Teva serves national pharmacy chains hospital groups and public health agencies. Its over the counter products reach consumers through retail outlets and grocery stores while its biosimilar and innovative medicines are used by physicians treating patients in outpatient clinics inpatient facilities and specialty treatment centers. The diversified customer mix helps mitigate reliance on any single channel and supports stable demand across its product lines.

Investment Thesis

▲ Bull case

The innovative franchise is delivering double digit growth with AUSTEDO up 28% year over year and AJOVY up 21% while UZEDY quarterly revenue reached 35 million dollars and full year guidance was raised to 100 million dollars reflecting strong adoption and a differentiated product profile. Phase 2 top line results for the anti TL1A program are expected in the fourth quarter and will provide placebo adjusted data that could support a rapid move into Phase 3 with partner Sanofi. Olanzapine LAI safety readout is scheduled for the first half of 2025 and the program has already exceeded target injection numbers with no PDSS observed supporting a potential label without monitoring requirements. The Prolia biosimilar has been accepted for review by both the FDA and EMA with a decision anticipated in the second half of next year targeting a 3 billion dollar brand opportunity. Emrusolmin Phase 2 study with 200 patients is fully enrolled and readout could unlock an accelerated pathway for a high unmet need in multiple system atrophy.
Global generics sales rose 17% in local currency with US generics up 30% EU up 8% and international up 13% driven by new complex launches such as Victoza octreotide Forteo and upcoming Symbicort and Saxenda. The company is mitigating persistent price pressure by accelerating product launches improving supply chain efficiency and focusing on higher margin generic products. A potential resurgence of domestic manufacturing incentives under a future administration could provide a structural tailwind for US generics allowing Teva to benefit from increased demand for locally sourced products. These actions together support sustainable margin expansion in the generics segment while maintaining market share leadership.
Free cash flow reached 922 million dollars in the quarter and year to date free cash flow increased 42% reflecting higher net profit and better working capital management. Net debt declined to 15.7 billion dollars and the debt to EBITDA ratio improved to 3.0x indicating strengthened cash generation and higher EBITDA. Credit rating agencies have upgraded Teva’s outlook with Fitch moving the rating to BB its first upgrade in over a decade signalling confidence in the company’s deleveraging and operational execution. Continued debt reduction creates capacity for future investments shareholder returns or further deleveraging toward an investment grade target.
Teva remains on track to divest the TAPI API business in the first half of 2025 which will remove a low growth legacy unit and allow reallocation of capital to higher growth areas. Non GAAP gross margin edged up to 53.7% reflecting a better product mix driven by innovative products and cost optimization efforts. Operating margin expanded to 28% as operating expenses declined as a percentage of revenue showcasing operating leverage and disciplined cost control. The deepened biosimilar pipeline now includes 17 assets targeting roughly 60 billion dollars of brand value with collaborations such as mAbxience advancing oncology biosimilars and providing long term growth drivers.

The innovative franchise is delivering double digit growth with AUSTEDO up 28% year over year and AJOVY up 21% while UZEDY quarterly revenue reached 35 million dollars and full year guidance was raised to 100 million dollars reflecting strong adoption and a differentiated product profile. Phase 2 top line results for the anti TL1A program are expected in the fourth quarter and will provide placebo adjusted data that could support a rapid move into Phase 3 with partner Sanofi. Olanzapine LAI safety readout is scheduled for the first half of 2025 and the program has already exceeded target injection numbers with no PDSS observed supporting a potential label without monitoring requirements. The Prolia biosimilar has been accepted for review by both the FDA and EMA with a decision anticipated in the second half of next year targeting a 3 billion dollar brand opportunity. Emrusolmin Phase 2 study with 200 patients is fully enrolled and readout could unlock an accelerated pathway for a high unmet need in multiple system atrophy.
Global generics sales rose 17% in local currency with US generics up 30% EU up 8% and international up 13% driven by new complex launches such as Victoza octreotide Forteo and upcoming Symbicort and Saxenda. The company is mitigating persistent price pressure by accelerating product launches improving supply chain efficiency and focusing on higher margin generic products. A potential resurgence of domestic manufacturing incentives under a future administration could provide a structural tailwind for US generics allowing Teva to benefit from increased demand for locally sourced products. These actions together support sustainable margin expansion in the generics segment while maintaining market share leadership.
Free cash flow reached 922 million dollars in the quarter and year to date free cash flow increased 42% reflecting higher net profit and better working capital management. Net debt declined to 15.7 billion dollars and the debt to EBITDA ratio improved to 3.0x indicating strengthened cash generation and higher EBITDA. Credit rating agencies have upgraded Teva’s outlook with Fitch moving the rating to BB its first upgrade in over a decade signalling confidence in the company’s deleveraging and operational execution. Continued debt reduction creates capacity for future investments shareholder returns or further deleveraging toward an investment grade target.
Teva remains on track to divest the TAPI API business in the first half of 2025 which will remove a low growth legacy unit and allow reallocation of capital to higher growth areas. Non GAAP gross margin edged up to 53.7% reflecting a better product mix driven by innovative products and cost optimization efforts. Operating margin expanded to 28% as operating expenses declined as a percentage of revenue showcasing operating leverage and disciplined cost control. The deepened biosimilar pipeline now includes 17 assets targeting roughly 60 billion dollars of brand value with collaborations such as mAbxience advancing oncology biosimilars and providing long term growth drivers.

▼ Bear case

GAAP operating loss of 51 million dollars and GAAP net loss of 437 million dollars in the quarter were driven by a 600 million dollar goodwill impairment on the API unit and 450 million dollars of legal settlements including a 350 million dollar provision for the EU Copaxone antitrust ruling. These non cash charges and cash outflows distort profitability metrics and create uncertainty about the timing and magnitude of future legal payments. The company has stated it will appeal the EU decision but acknowledges that resolution may take many years meaning the financial overhang could persist for an extended period. Until those matters are settled GAAP earnings will remain volatile and may obscure the underlying operational improvements.
Persistent downward pricing pressure in US generics continues to erode margins and management explicitly stated that prices will be pushed down requiring constant new product launches to offset the decline. While recent complex launches such as Victoza octreotide Forteo Symbicort and Saxenda provide some relief the sustainability of this approach depends on the company’s ability to maintain a robust pipeline of differentiated generics. Any slowdown in launch execution or increase in competitor activity could quickly reverse the recent growth trajectory and put pressure on overall generics revenue. Furthermore the inflation reduction act may eventually enable price negotiations for high cost branded drugs such as AUSTEDO which could limit future upside for the innovative franchise.
The anti TL1A program while promising remains in Phase 2 and success is not guaranteed. Failure to meet primary endpoints would delay or derail a potential blockbuster in inflammatory bowel disease. Olanzapine LAI safety data expected in the first half of 2025 will be crucial. Any emergence of PDSS or safety concerns could hinder label approval and market adoption. Biosimilar approvals such as for Prolia are subject to regulatory timelines and any delay would postpone revenue from a 3 billion dollar brand opportunity while competition in the biosimilar space intensifies. The company’s reliance on a limited number of flagship innovative products means that a setback in any one of them could disproportionately affect overall growth prospects.
Although net debt has declined to 15.7 billion dollars the leverage level remains high and any rise in interest rates could increase debt servicing costs and constrain financial flexibility. The company’s free cash flow generation is partially offset by rising legal payments including opioid litigation settlements which have increased year to date and could continue to weigh on cash available for investment or shareholder returns. Foreign exchange headwinds from a stronger US dollar have already reduced year to date revenue by approximately 250 million dollars and gross profit by 190 million dollars and may persist if the dollar remains strong. The planned acquisition of Emalex Biosciences for 700 million dollars plus potential milestones adds integration risk and could divert cash from core operations if the anticipated neurological drug ecopipam fails to meet expectations.

GAAP operating loss of 51 million dollars and GAAP net loss of 437 million dollars in the quarter were driven by a 600 million dollar goodwill impairment on the API unit and 450 million dollars of legal settlements including a 350 million dollar provision for the EU Copaxone antitrust ruling. These non cash charges and cash outflows distort profitability metrics and create uncertainty about the timing and magnitude of future legal payments. The company has stated it will appeal the EU decision but acknowledges that resolution may take many years meaning the financial overhang could persist for an extended period. Until those matters are settled GAAP earnings will remain volatile and may obscure the underlying operational improvements.
Persistent downward pricing pressure in US generics continues to erode margins and management explicitly stated that prices will be pushed down requiring constant new product launches to offset the decline. While recent complex launches such as Victoza octreotide Forteo Symbicort and Saxenda provide some relief the sustainability of this approach depends on the company’s ability to maintain a robust pipeline of differentiated generics. Any slowdown in launch execution or increase in competitor activity could quickly reverse the recent growth trajectory and put pressure on overall generics revenue. Furthermore the inflation reduction act may eventually enable price negotiations for high cost branded drugs such as AUSTEDO which could limit future upside for the innovative franchise.
The anti TL1A program while promising remains in Phase 2 and success is not guaranteed. Failure to meet primary endpoints would delay or derail a potential blockbuster in inflammatory bowel disease. Olanzapine LAI safety data expected in the first half of 2025 will be crucial. Any emergence of PDSS or safety concerns could hinder label approval and market adoption. Biosimilar approvals such as for Prolia are subject to regulatory timelines and any delay would postpone revenue from a 3 billion dollar brand opportunity while competition in the biosimilar space intensifies. The company’s reliance on a limited number of flagship innovative products means that a setback in any one of them could disproportionately affect overall growth prospects.
Although net debt has declined to 15.7 billion dollars the leverage level remains high and any rise in interest rates could increase debt servicing costs and constrain financial flexibility. The company’s free cash flow generation is partially offset by rising legal payments including opioid litigation settlements which have increased year to date and could continue to weigh on cash available for investment or shareholder returns. Foreign exchange headwinds from a stronger US dollar have already reduced year to date revenue by approximately 250 million dollars and gross profit by 190 million dollars and may persist if the dollar remains strong. The planned acquisition of Emalex Biosciences for 700 million dollars plus potential milestones adds integration risk and could divert cash from core operations if the anticipated neurological drug ecopipam fails to meet expectations.

Peer Comparison

Companies in the Drug Manufacturers - Specialty & Generic

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	HLN	Haleon plc	88.07 Bn	103.29	6.00	11.45 Bn
2	TEVA	Teva Pharmaceutical Industries Ltd	35.75 Bn	23.02	2.06	16.63 Bn
3	ZTS	Zoetis Inc.	31.84 Bn	12.05	3.35	9.05 Bn
4	TAK	Takeda Pharmaceutical Co Ltd	27.18 Bn	-10.29	0.59	28.76 Bn
5	UTHR	UNITED THERAPEUTICS Corp	23.09 Bn	17.93	7.28	-
6	RDHL	RedHill Biopharma Ltd.	21.32 Bn	2,931.66	2.24	-
7	VTRS	Viatris Inc	19.96 Bn	-67.32	1.37	14.34 Bn
8	NBIX	Neurocrine Biosciences Inc	17.66 Bn	26.41	5.69	-

Research Tools

Developers

About

Investment Thesis

Geographical Breakdown of Revenue (2025)

Peer Comparison

Research Tools

Developers

About

Investment Thesis

Geographical Breakdown of Revenue (2025)

Peer Comparison

Create an account

Sign In

Reset Password