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Analyst Blog

Teva Pharmaceutical Industries Limited (TEVA - Free Report) announced that it has completed the acquisition of Allergan plc’s (AGN - Free Report) U.S. generic distribution business Anda, Inc. Teva entered into a definitive agreement to acquire Anda, the 4th largest distributor of generic pharmaceuticals in the U.S., for $500 million in August this year.

Anda distributes generic, brand, specialty and OTC pharmaceutical products from more than 300 manufacturers to retail independent and chain pharmacies, nursing homes, mail order pharmacies, hospitals, clinics and physician offices across the U.S. In 2016, Anda is expected to generate more than $1 billion in third-party revenues. Under the takeover deal, Teva will acquire three distribution centers in Olive Branch, MS; Weston, FL; and Groveport, OH, which employs over 650 people. Thus, Anda is expected to be a synergistic fit for Teva's business model.

Acquisitions have been an integral part of Teva’s expansion strategy. Over the past few years, the company has completed several major acquisitions including Allergan’s generics business - Actavis Generics, The company’s growth-by-acquisition strategy has enhanced its operational expertise and manufacturing capabilities substantially, provided support to its long-term investment in generics business, and aided expansion in emerging markets.

Zacks Rank & Key Picks

Teva Pharmaceutical currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in health care sector include Anika Therapeutics Inc (ANIK - Free Report) and ANI Pharmaceuticals, Inc. (ANIP - Free Report) .

Anika Therapeutics – a Zacks Rank #1 (Strong Buy) stock – has seen its earnings estimates for 2016 and 2017 rise 9.4% and 11.5%, respectively, over the last 60 days. The company recorded a positive earnings surprise in each of the last four quarters, with an average beat of 42.19%. Its share price has jumped 25.6% year to date.

ANI Pharmaceuticals witnessed an increase of 9.5% and 4.7% in its earnings estimates for 2016 and 2017, respectively, in the last 60 days. It has beaten earnings estimates twice in the last four quarters, taking the average to 46.85%. The company’s stock price has rallied 50.6% year to date. ANI Pharmaceuticals also sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

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