Summary:

  • Teva Pharmaceutical (TEVA) fell 9% on Wednesday morning, after it posted earnings that missed Wall Street expectations.
  • The stock’s market cycles point to a period of increasing risk as the current cycle matures, resuming a declining phase..

Teva reported earnings per share of $0.53 and total revenue of $4.56 billion, compared to analyst estimates of $0.55 and $4.52 billion. With regards to guidance, its forecasted earnings and revenue that were below the average analyst estimates.

CEO Kare Schultz explained that, “Looking ahead, we continue to expect that 2019 will be the trough for our business,” noting that growth would return in 2020.

With regard to Teva’s market cycles, we can see that the stock has already broken below the point at which it began the cycle. It attempted to rally back up to that point but failed. We expect downside risk to increase as the current cycle matures, with a target below $15 by early-April.

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