Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 5.9%. Since the same quarter one year prior, revenues rose by 18.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.62, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Despite the fact that TEVA's debt-to-equity ratio is low, the quick ratio, which is currently 0.66, displays a potential problem in covering short-term cash needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Pharmaceuticals industry and the overall market, TEVA PHARMACEUTICALS's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- Net operating cash flow has decreased to $1,191.00 million or 10.04% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
Teva Pharmaceutical Industries Limited develops, manufactures, and sells pharmaceutical products worldwide. The company has a P/E ratio of 10.9, below the average drugs industry P/E ratio of 11.2 and below the S&P 500 P/E ratio of 17.7. Teva has a market cap of $34.86 billion and is part of the
industry. Shares are down 0.5% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.
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