Teva (NYSE:TEVA) Valuation in Focus After FDA Green Light for Generic Saxenda Launch

Teva Pharmaceutical Industries (NYSE:TEVA) just landed a key win with the FDA approval and U.S. launch of its generic version of Saxenda, a popular medication for chronic weight management. This is more than just another addition to Teva’s product portfolio, since branded Saxenda’s U.S. sales were $165 million in the last year. For investors, that headline might prompt quick discussions around potential market share, additional revenue, and what this move signals about Teva’s current momentum in the generics field.

This latest product announcement comes at a time of quietly building momentum for Teva’s shares. The stock has returned about 8% over the past year, rising nearly 10% in the past three months and jumping 18% over the past month. This follows a longer stretch of strong performance, as returns have more than doubled in the last three and five years. Yet the company’s recent quarterly report still pointed to steady, not spectacular, annual growth in both revenue and net income. With a high-profile FDA green light now in the rearview, investors are right to focus on whether this launch could be a catalyst for further gains.

After a stretch of solid returns and an FDA-backed growth driver, is Teva trading at a discount that savvy investors should snap up, or is the market already pricing in the next wave of growth?

Most Popular Narrative: 18% Undervalued

According to the most widely followed narrative, Teva Pharmaceutical Industries is viewed as significantly undervalued compared with analyst expectations. The current share price is seen at a substantial discount to what future growth could justify, based on a blend of revenue and profit expansion assumptions, together with higher projected profit margins and optimistic future earnings.

The accelerating launch cadence of biosimilars (with 8 launches targeted through 2027 and a goal to double biosimilar revenue), supported by favorable regulatory trends that are increasing biosimilar adoption in major markets, should unlock incremental, higher-margin revenue streams and offset headwinds from traditional generics. This is projected to support long-term EBITDA growth.

Want the inside story behind this bold undervaluation call? The narrative centers on ambitious profit forecasts and a future valuation multiple more typical of fast-growth sectors. What are the underlying assumptions that place Teva’s true value nearly a fifth above current market price? The numbers driving this fair value estimate might surprise you.

Result: Fair Value of $23.56 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, a heavy debt load and reliance on a small number of branded drugs could quickly undermine bullish projections for Teva’s next chapter.

Find out about the key risks to this Teva Pharmaceutical Industries narrative.

Another View: A Closer Look at Value

While the widely followed narrative spotlights Teva as undervalued, our DCF model also points to the shares trading far below intrinsic value. Are both methods seeing the same opportunity, or missing new risks?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Teva Pharmaceutical Industries for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Teva Pharmaceutical Industries Narrative

If these narratives do not match your view or if you want to dig into the numbers and shape your own perspective, it takes just a few minutes. Do it your way

A good starting point is our analysis highlighting 5 key rewards investors are optimistic about regarding Teva Pharmaceutical Industries.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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