Takeda Pharmaceutical (TSE:4502) Valuation Check After Recent Share Price Momentum

Why Takeda Pharmaceutical Stock Is On Investors’ Radar

Takeda Pharmaceutical (TSE:4502) has recently drawn attention after a strong run in the past 3 months, with the share price and fundamentals giving investors new data points to assess its longer term appeal.

See our latest analysis for Takeda Pharmaceutical.

The recent 90 day share price return of 21.05% and 30 day share price return of 12.98% suggest momentum has been building, while a 1 year total shareholder return of 31.35% reflects a stronger longer term payoff when dividends are included.

If Takeda’s move has you thinking about opportunities across the sector, this is a good moment to scan healthcare stocks for other healthcare names on your radar.

With Takeda trading close to its analyst price target and flagged as having a value score of 5, the key question is whether an apparent intrinsic discount still leaves upside or if the market is already pricing in future growth.

Most Popular Narrative: 2.6% Overvalued

Compared with the last close at ¥5,073, the most followed narrative pegs Takeda’s fair value at about ¥4,946, suggesting only a small gap between price and modelled worth.

The analysts have a consensus price target of ¥5056.071 for Takeda Pharmaceutical based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of ¥5900.0, and the most bearish reporting a price target of just ¥4500.0.

Read the complete narrative.

Curious why modest revenue assumptions, rising margins and a richer future P/E still leave only a tight gap to today’s price? The full narrative lays out the exact earnings path and valuation bridge that support this view.

Result: Fair Value of ¥4,946 (OVERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, you still need to weigh the risk that generic and biosimilar competition or higher R&D costs could put pressure on Takeda’s revenue and margins.

Find out about the key risks to this Takeda Pharmaceutical narrative.

Another View On Takeda’s Valuation

While the most popular narrative sees Takeda as about 2.6% overvalued around ¥5,073, our DCF model points in a very different direction, with an estimated fair value of ¥12,570.01 per share, or roughly 59.6% above the current price. Which story do you think fits Takeda better?

Look into how the SWS DCF model arrives at its fair value.

Build Your Own Takeda Pharmaceutical Narrative

If you are not fully on board with these assumptions or simply want to test your own view of Takeda against the data, you can pull the same metrics, set your own expectations and build a custom storyline in just a few minutes with Do it your way.

A great starting point for your Takeda Pharmaceutical research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

Looking For More Investment Ideas?

If Takeda has sharpened your interest, do not stop here, the same tools that surface this story can help you spot other opportunities before the crowd.

This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com