November 10th, 2021 | 11:25 CET
Pfizer, BioNTech, Water Ways Technologies, Teva Pharma - High-Tech and the Pandemic!
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Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Teva Pharmaceutical - Generics from Israel in turnaround
A well-known representative of the Israeli pharmaceutical sector is Teva Pharmaceutical Industries Ltd., based in Petach Tikva, not far from the capital of Tel Aviv. It is one of the world's top ten manufacturers of pharmaceuticals and is regarded as the global market leader in generics. The Company is active in over 70 countries and generated sales of just over USD 16.6 billion in 2020. Teva specializes in developing, producing, and distributing pharmaceuticals such as specialty therapeutics, generics and over-the-counter medicines, and drug substances. Teva International in Germany includes Ratiopharm, among others.
In 2017, it became known that Teva was in deep trouble, as the Company was relatively heavily leveraged and had over-leveraged its balance sheet. The Company had to deal with more than 20% sales declines within the last five years due to the necessary restructuring. The difficulties were certainly also due to the much too costly acquisitions of Actavis and Allergan for a total of USD 40.5 billion in 2015 and 2016.
Teva has also been embroiled in the US opioid litigation for years, but a recent court ruling from California offers medium-term hope. A few days ago, the generic drugmaker also managed to restructure its outstanding bonds completely. According to Teva, this is the largest sustainability bond issue to date, replacing old debt with new bonds with modern sustainability rules. The initially set USD 4 billion issue of several tranches ended up at a placed volume of USD 5 billion due to excess demand from institutional investors.
There was no good news at Teva for a long time, but the latest news could signal the start of a turnaround for the stock, which has been volatile between EUR 7 and EUR 12 since 2019. Currently, it stands at EUR 8 and can now be added to the watchlist again. Speculative!
Water Ways Technologies - Agricultural technology in the wake of climate change
Clean water, good nutrition and hygiene are basic human needs and indispensable for healthy development. For this reason, as part of the Sustainable Global Development Goals, the world's nations have set out to provide everyone with access to clean drinking water and adequate sanitation by 2030.
Africa and Asia are continents at the forefront of this need, hoping for a few standards that industrialized nations take for granted. Israel, with its technological aspirations, is one of the flagship states of the African continent. In purely geographical terms, it lies on a land bridge between Asia and Africa on the eastern edge of the Mediterranean. That makes it geographically part of the Near East, but geologically part of Africa, as it lies on the African continental plate.
Global agriculture is responsible for nearly 70% of the world's water demand, so water must be heavily rationed and distributed through government control in many countries. Water Ways Technologies Inc. (WWT) and its subsidiaries are Israeli providers of smart agriculture and water distribution technology. WWT's patented systems are currently becoming an Israeli export hit, as states plagued by drought and infertility are in particular need of technical support in agricultural management.
WWT received several new orders in early November to supply its irrigation components worth the equivalent of over CAD 1 million to customers in South America. These are mainly systems needed to implement irrigation projects for blueberries, grapes and mangoes. The Company expects the orders to be fully delivered and invoiced by the end of Q1-2022. This is excellent news from Israel!
WWT stock is performing quite magnificently at the moment, reaching the CAD 37 million mark in market capitalization. Given the global climate change, the demand for WWT technologies should continue to grow strongly, so our outlook remains positive. The stock is trading quite actively on Tradegate and in Frankfurt.
Pfizer versus BioNTech - Now comes the big partner
The stock market sector of vaccine manufacturers is currently experiencing significant upheavals. The former winners are getting into tricky waters due to various circumstances, as whistleblowers and rumor-mongers report alleged inconsistencies in connection with the approval studies in the run-up to FDA approval.
Regardless of whether the current discussions turn out to be true or false, investors are already massively unsettled and are taking their lush profits of recent months with them for now. In the case of BioNTech and Moderna, this led to temporary losses of over 20%. The highs for the year are probably history. Although both stocks are currently recovering, they remain the subject of speculation. Other competitors such as Valneva and CureVac have also been caught up in the turmoil.
The distribution and production partner of BioNTech, Pfizer, then also came at an inopportune time with its announcement of its own drug called Paxlovid. The drug is used against Corona and inhibits the spread of the virus. According to the manufacturer, the risks of hospitalization or death are seriously reduced. The US company wants to obtain emergency approval from the FDA in the US as soon as possible. Competitor Merck had earlier introduced another drug called Lagevrio, which was now approved in the UK in early November. Allegedly, hospital admissions are to be reduced by 50% here. According to the manufacturer's claims, the Pfizer drug even comes to a dream value of 89%. The analysts of DZ Bank are enthusiastic and confirm their buy recommendation for Pfizer, and the price target was raised from USD 52 to 54. In terms of portfolio diversification in the pharma-biotech sector, the inclusion of further titles makes sense, in our opinion. However, be prepared for very high volatility in general.
The biotech and pharma sector is in wild turmoil. The race of the manufacturers has long since reached a new level with a focus on fighting pandemics. Not only vaccines but also drugs have their clear reason for being. In agriculture and related technologies for water and cultivation techniques, we are also facing a super-cycle in terms of climate change. Teva is a turnaround candidate; Pfizer and Water Ways Technologies are currently bought at short-term highs.
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