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TECH or TEVA

Sell Comparision. Analyst: Joseph Winkelbauer. TECH or TEVA. TECH & TEVA Currently (From Yahoo, as of 10/20/2009 ) . TECH > Mkt Cap 2.39B Stock Price $63.83 (Down) 52-Week Range 45.38-72.50 EPS (TTM) 2.78 PEG 1.88 Beta .70. TEVA> Mkt Cap 44.90 B Stock Price $51.26 (Up)

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TECH or TEVA

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  1. Sell Comparision Analyst: Joseph Winkelbauer TECH or TEVA

  2. TECH & TEVA Currently(From Yahoo, as of 10/20/2009) • TECH > Mkt Cap 2.39B • Stock Price • $63.83 (Down) • 52-Week Range • 45.38-72.50 • EPS (TTM) • 2.78 • PEG • 1.88 • Beta • .70 • TEVA> Mkt Cap 44.90B • Stock Price • $51.26 (Up) • 52-Week Range • 37.55-54.95 • EPS (TTM) • 1.10 • PEG • .87 • Beta • .14

  3. What they do… • Techne Corporation • A holding company for two subsidiaries • US subsidiary manufactures and sells hematology controls that test the accuracy in blood analysis instruments. Also manufactures biotechnology products/ purified proteins, antibodies that enhance cells. • British subsidiary sells the items from the US subsidiary side in Europe • R&D Europe researches cancers, glycobiology, immunology, neurosciences, stem cells, proteins.

  4. NEWS • Morningstar- • 4th Quarter Profit Falls -6.9% • Oct 2 Director (CEO of a Pharma) wins Paul Ehrlich and Ludwig Darmstaedter Prize for research on the cytokines (cell actions) and the field of what R&D Europe works on

  5. SWOT- TECH • Strengths • R&D Europe has a lot of projects going on • Organization split up for each unit to be specific in its related field

  6. SWOT- TECH • Weaknesses • No recent significant news releases on product development / future • 4th Quarter profit falls • Opportunities • Decided to expand into China with business operations • Obama Healthcare reform • Least taxed area of healthcare for healthcare reform

  7. SWOT- TECH • Threats • Pharmaceutical Industry Competition • Regulations FDA

  8. TECH’s COMPETITORS MorningStar

  9. Yahoo Charts - TECH(2yr 200 Day Moving Average + RSI)

  10. Yahoo Charts – TECH (5yr With competitors)

  11. What they do… • TEVA Pharmaceuticals • Global organization • Development, production, and marketing of Generic Drugs/Pharmaceuticals • Brand drugs its known for deal with: Multiple Sclerosis, Parkinson’s Disease, Neurological disorders, Inflammatory diseases (Crohn’s/GI, Lupus/skin, Psoriasis/skin) • Website • Fact Sheet • Map

  12. NEWS • Morningstar- • Questionable trade agreements with brand companies and generic companies • Benefiting from Price Stability • Motley Fool- • Oct 8 states TEVA as one best investments; Oct 13 claims that TEVA will play big part in future healthcare • TheStreet.com- • Top fast growing stock

  13. SWOT- TEVA • Strengths • Distanced itself from its competitors in the end of 2008 by acquiring Barr Pharmaceuticals ( the 4th largest generic drug company worldwide) • Acquired IVAX an organization that deals with inhalant drugs and respiratory technology • Copaxone (Multiple sclerosis therapy drug) • Website claims that TEVA is among the top 20 pharmaceutical companies in the world

  14. SWOT- TEVA • Weaknesses • The organization attributes part of its revenue success from acquiring other organizations which increase the amount of revenue, but does it really increase the profitability of the organization • Limited Brand Specialties • Opportunities • Copaxone drug believed to see the most of its profitability in 2010 • Has been working on Biologics (Drugs derived from living sources as opposed to the regular chemical drug) Outlook projected to be 5 yrs from now for generics and TEVA is on the frontier of it • Update: 10/19/2009, New Hormone Drug in relation to new cell growth and possible stem cell projects.

  15. SWOT- TEVA • Threats • Copaxone drug believed see competition enter the market about 2014 • Update: 10/19/2009, Mylan enters with filing of generic drug containing Copaxone - TEVA sues for patent infringement • Other generic drug organizations/ their entry into the market • Getting beat to new innovations

  16. TEVA’s COMPETITORS MorningStar

  17. Yahoo Charts - TEVA(2yr 200 Day Moving Average + RSI)

  18. Yahoo Charts – TEVA (5yr With competitors)

  19. 3 Stage DDM • TECH • 3 Stage DDM = $58.56 • High Growth 3 yrs @ 14% • Stable Growth 5 yrs @ 6.5 % • TEVA • 3 Stage DDM = $55.71 • High Growth 3 yrs @ 20.88% • Stable Growth 5 yrs @ 6.5 %

  20. Morningstar Estimates • TECH • Fair Value Estimate Not listed • “ “ • “ “ • TEVA • Fair Value Estimate = $59.00 • Consider Buying at: $41.30 • Consider Selling at: $82.60

  21. Morningstar Cross Sectional Analysis

  22. Reuters Cross Sectional Analysis (TECH)

  23. Reuters Cross Sectional Analysis (TECH)

  24. Reuters Cross Sectional Analysis (TEVA)

  25. Reuters Cross Sectional Analysis (TEVA)

  26. Net Income / $Mill(From Morningstar) • TECH • TTM 105.2 • 2008 103.6 • 2007 85.1 • 2006 73.4 • 2005 66.1 • 2004 52.9 • 2003 45.4 • 2002 27.1 • 2001 34.1 • 2000 26.6 • TEVA • TTM 934.0 • 2008 635.0 • 2007 1952.0 • 2006 546.0 • 2005 1072.3 • 2004 331.8 • 2003 691.0 • 2002 410.3 • 2001 278.2 • 2000 148.4 • 1999 117.8

  27. Balance Sheets CA & CL / TECH(From Morningstar)

  28. Balance Sheets CA & CL / TEVA(From Morningstar)

  29. TECH Trend Analysis(From Morningstar)

  30. TEVA Trend Analysis(From Morningstar)

  31. Google Finance Comparisions

  32. Google Finance Comparisions(Continued….)

  33. Recommendation • Sell TECH • 4th Quarter Profits Fall • Growth Stock • Compared to our standards • To bring healthcare section of our portfolio to market weight • No Recent Breaking News • No developments / advancements • Hard to find new news • BRLI is doing Better • Forbes.com 10/19/2009 – ranked 4th as one of 200 best small companies • To diversify our portfolio more • Tech Has had Neg returns and Neg YTD returns • Diagnostics Getting Beat By Pharmaceutical Industry • TEVA is in pharmaceuticals • 3 Stage DDM suggests its overvalued • Valuation of $58.56 • Actual of $ 63.83 • Not suggested on Morningstar • Google Comparison Chart • Lower than TEVA • Yahoo Chart RSI • Suggests its overbought = overvalued

  34. Recommendation • Hold TEVA • Recent News • States it’s a key player in Healthcare reform • Best Investments • Fast Growing Stock • TEVA is doing well • Helps diversify our portfolio • Has had + returns and + YTD returns • On the Frontier of Biologics • Pharmaceutical Industry • Projected best in Healthcare Sector • Performs the best in sector so far • 3 Stage DDM suggests its undervalued • Valuation of $55.71 • Actual of $ 51.26 • Morningstar Suggested $59.00 • Google Comparison Chart • Higher than TECH • Yahoo Chart • Beats Majority of its Competitors • RSI Suggests its more toward being oversold = undervalued

  35. Class Decision • The IMP class decided that TEVA was doing well and that it would not be sold. Also, TECH was hinted at possibly providing continued growth as well as success in the future. Both companies were agreed upon as still being good companies. So the class decided to sell a portion of the two Healthcare stocks that were doing really well but continue to hold all of the companies. Since BRLI and TEVA were doing well they were the two stocks chosen to be partially sold. TECH was held and not sold.

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