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Julian Robertson Bets on Teva

November 04, 2011 | About:
Julian Robertson of Tiger Management purchased 364,400 shares of TEVA in the second quarter of 2011.

TEVA (NYSE:TEVA) is the world's largest manufacturer of generic drugs.

TEVA has fallen dramatically since the hedge fund manager took a stake. TEVA now trades at $36 per share while Robertson most likely took a position at $50 per share.

TEVA is the world’s largest manufacturer of generic drugs. The company has a $36 billion market cap. The stock has attracted value investors with a price-to-earnings ratio of 11.68. The dividend yield is 2%.

However, earnings fell in the second quarter of 2011. Second quarter net income was $576 million compared to net income of $787 million in the second quarter of 2010. In addition a lot of value investors are fearful that TEVA will have difficulty digesting its acquisition of Taiyo Pharmaceutical and Cephalon. The company announced that it would purchase Cephalon (CEPH) for $6.8 billion in May of 2011.

TEVA has always traded at a discount due to the fact that the company is headquartered in Israel. The geopolitical risks have always been factored into market valuations of TEVA stock.

Both George Soros and Leon Cooperman also hold stakes in the drug manufacturer.

Rating: 3.0/5 (7 votes)


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GuruFocus has detected 4 Warning Signs with Teva Pharmaceutical Industries Ltd $TEVA.
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