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Teva Edges Closer To Growth, But With A Big Overhang

 
• By Jessica Merrill

Teva's turnaround is progressing, but the company forecast largely flat revenues and earnings in 2020. A threat to the improved stability is how an opioid litigation settlement might unfold.

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A Teva turnaround is progressing • Source: Shutterstock

Teva Pharmaceutical Industries Ltd. is heading into the third year of a massive turnaround strategy that began under CEO Kare Schultz in late 2017, and while the company made substantial progress on its goal of returning to earnings growth in 2020, the expectation for generic revenues continues to be moderate and there is a threat to the stability from opioid liability litigation.

Teva updated investors on its 2019 financial results and 2020 forecast on 12 February with earnings before interest, taxes, depreciation and amortization (EBITDA) forecast to be $4.5bn to $4.9bn in 2020, a range that is slightly below to slightly above 2019 EBITDA of $4.7bn in 2019. A year ago, Teva had guided investors to expect 2019 would be a trough year before returning to earnings growth in 2020, so it remains unclear if Teva will actually reach that goal

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