The firm also slashed its price target to $44 from $64 on shares of the Israel-based pharmaceutical company.
HSBC assigned a higher discount rate due to the significant uncertainty stemming from the U.S. Department of Justice's investigation into generic drug makers, the Fly noted.
The DOJ may file charges in a probe of about a dozen generic drug companies by the end of the year, according to Bloomberg.
The firm did not change its Teva estimates.
Shares of Teva were higher in pre-market trading today. The stock closed down 9.53% to $39.20 on Thursday.
Separately, TheStreet Ratings Team has a "Hold" rating with a score of C+ on the stock.
The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins.
But the team also finds weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: TEVA