Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 4 Mar, 25 | TAK | Buy | USD 14.84 | USD 15.85 | USD 17.0 | 92 days | Closed |
1.28%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Takeda Pharmaceutical Company Limited engages in the research, development, manufacture, marketing, and out-licensing of pharmaceutical products in Japan and internationally. It offers pharmaceutical products in the areas of gastroenterology, rare diseases, plasma derived therapies, immunology, oncology, and neuroscience. The company provides its products under the Entyvio, Gattex/Revestive, Takecab/Vocinti, Alofisel, Dexilant, Pantoloc/Controloc, Adynovate/Adynovi, Feiba, Recombinate, Hemofil/Immunate/Immunine, Takhzyro, Livtencity, Elaprase, Replagal, Advate, Flexbumin, Vpriv, Gammagard Liquid/Kiovig, Hyqvia, Cuvitru, Exkivity, Ninlaro, Velcade, Azilva-F, Lotriga, Iclusig, Leuplin/Enantone, Adcetris, vyvanse/elvanse, Trintellix, and Alunbrig brands. It has in-license agreement with BioMarin, Luxna Biotech, GlaxoSmithKline, Halozyme, and Kamada; collaboration with Neurocrine Biosciences, Inc., Seagen Inc., Anima Biotech, Denali Therapeutics, KSQ Therapeutics, Noile-Immune Biotech, Center for iPS Cell Research Application, Kyoto University (CiRA), and Charles River Laboratories; licensing agreement with Mirum Pharmaceuticals and Twist Bioscience, UCSD/Fortis Advisors, PeptiDream, MD Anderson Cancer Center, Teva Pharmaceutical Industries, and Xenetic Biosciences; collaboration and licensing agreement with Arrowhead Pharmaceuticals Inc., Engitix, Genevant Sciences Corporation, Sosei Heptares, Zedira/Dr. Falk Pharma, Exelixis, Inc., GlaxoSmithKline, Heidelberg Pharma, HUTCHMED, Presage Biosciences, Codexis, Inc., Ensoma, Envozyne, KM Biologics, and Selecta BioScience, and Ovid Therapeutics Inc.; and collaboration with ZEDIRA GmbH and Dr. Falk Pharma GmbH. It has research collaboration and licensing agreement with Crescendo Biologics, Code Bio, Immusoft, Poseida Therapeutics, and Selecta Biosciences. The company was founded in 1781 and is headquartered in Tokyo, Japan.
Significant Free Cash Flow Improvement: Adjusted free cash flow surged by 1,466% from JPY 36.3 billion in FY2023 Q3 YTD to JPY 568.3 billion in FY2024 Q3 YTD
Strong Revenue and Profit Growth: Revenue increased by 9.8% at AER and 4.5% at CER, reaching JPY 3,528.2 billion for the first nine months of FY2024. Core operating profit grew by 10.1% at CER, with a core operating margin improvement to 28.5% (up from 26.9%)
Decline in Core Operating Profit Guidance (Compared to Initial Projections): The company initially projected a mid-single-digit decline in core operating profit but later revised it to a low-single-digit increase—an improvement but still a conservative outlook relative to long-term expectations.
Lower Growth in Core EPS at Constant Exchange Rates: While Core EPS increased by 7.5% at AER, it only grew 0.9% at CER, indicating weaker underlying profitability when excluding currency effects.
Key investment risks for Takeda include potential regulatory delays in late-stage pipeline approvals, foreign exchange fluctuations impacting financial performance, competitive pressures in key therapeutic areas, and execution risks associated with cost-saving initiatives and integration of new acquisitions
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 14.84 | 12.91 | 15.85 | 17.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Robust Revenue and Profit Growth
Takeda Pharmaceutical Company has announced strong financial results for the third quarter of fiscal year 2024, reflecting solid momentum in its Growth & Launch Products. The company reported revenue growth of 9.8% at actual exchange rates (AER) and 4.5% at constant exchange rates (CER), driven by a 14.6% increase in Growth & Launch Products at CER. Core operating profit increased by 10.1% at CER, while the core operating profit margin improved to 28.5%. Reported operating profit saw a significant rise of 86.3% at AER, primarily due to lower impairment of intangible assets compared to the previous fiscal year.
Upgraded Financial Forecast and Increased Shareholder Returns
In response to the strong performance and operational efficiencies, Takeda has raised its adjusted free cash flow forecast by JPY 150.0 billion, setting a new range of JPY 550.0 – JPY 650.0 billion. Additionally, the company has announced a share buyback program of up to JPY 100.0 billion, underscoring its confidence in sustained growth and its commitment to enhancing shareholder value.
Advancement of Late-Stage Pipeline and Growth Prospects
Takeda continues to make progress in its late-stage pipeline, with three Phase 3 data readouts expected in 2025. The company anticipates regulatory filings for three programs between fiscal years 2025 and 2026, and an additional five filings between fiscal years 2027 and 2029. Notably, six of these late-stage programs have the potential to generate peak revenues ranging from USD 10 billion to 20 billion in total, further strengthening Takeda’s long-term growth prospects.
Key Pipeline Developments and Regulatory Plans
Among the late-stage pipeline programs, Takeda is advancing oveporexton (TAK-861) for narcolepsy type 1, zasocitinib for psoriasis, and rusfertide for polycythemia vera, with regulatory filings expected in fiscal years 2025–2026. Additional filings planned for fiscal years 2027–2029 include zasocitinib for psoriatic arthritis, mezagitamab for immune thrombocytopenia and IgA nephropathy, fazirsiran for alpha-1 antitrypsin deficiency-associated liver disease, and elritercept for anemia associated with myelodysplastic syndrome.
Revised Full-Year Outlook Reflecting Strong Performance
Takeda has upgraded its full-year financial guidance, citing continued product momentum, operational cost efficiencies, and revised foreign exchange assumptions. The company now projects a low single-digit percentage increase in core revenue, an increase in core operating profit, and a flat to slightly declining core earnings per share (EPS). The revised forecast includes a revenue increase to JPY 4,590.0 billion, an adjusted core operating profit of JPY 1,150.0 billion, and an adjusted free cash flow range of JPY 550.0 – JPY 650.0 billion.
Commitment to Long-Term Growth and Innovation
Beyond its late-stage programs, Takeda remains focused on strengthening its early-stage pipeline and pursuing strategic business development opportunities. By continuously investing in innovative therapies, the company aims to deliver transformative treatments for patients while sustaining long-term revenue growth. As emphasized by Takeda’s Chief Financial Officer, Milano Furuta, the company is confident in its ability to drive profitability and create value for shareholders through disciplined financial management and strategic growth initiatives.
Technical Commentary:
Takeda Pharmaceutical's stock is in a strong uptrend, breaking above key moving averages (21-day MA at 13.86 and 50-day MA at 13.46) with increasing volume, confirming bullish momentum. However, the RSI at 75.71 indicates overbought conditions, suggesting a potential short-term pullback or consolidation. Key levels to watch include 14.50 as support and 15.00 as resistance, with continued strength likely if the stock holds above these levels.
As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Buy’ rating has been given to Takeda Pharmaceutical Company (NYSE: TAK) at the closing market price of USD 14.84 as of March 03, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Healthcare Industry: Drug Manufacturers - Specialty & Generic
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| TAK Takeda Pharmaceutical Co Ltd ADR |
-0.08 0.52% | 15.34 | 32.67 | 11.53 | 0.01 | 0.87 | 0.02 | 0.07 |
| ZTS Zoetis Inc |
0.10 0.06% | 159.18 | 40.18 | 30.96 | 10.67 | 17.60 | 11.27 | 26.18 |
| MKKGY Merck KGaA ADR |
-0.52 1.96% | 26.06 | 21.25 | 14.93 | 3.10 | 2.14 | 3.60 | 12.98 |
| MKGAF MERCK Kommanditgesellschaft auf Aktien |
0.05 0.04% | 134.76 | 21.73 | 14.95 | 3.16 | 2.15 | 3.56 | 12.82 |
| TKPHF Takeda Pharmaceutical Co. Ltd. |
- -% | 28.35 | 32.60 | 11.59 | 0.01 | 0.88 | 0.02 | 0.07 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is March 03,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Disclaimer :
This report has been issued by StockNextt which has an Ontario Business Identification Number 1000958347 and British Columbia registration Number FM1051529 is a trade name under Kalkine Canada Advisory Services Inc. having Business Number 761925130BC0001. Kalkine Canada Advisory Services Inc. and StockNextt are collectively referred to as “StockNextt”, “we”, “us”, and “our”. The website https://stocknextt.com and associated pages are published by StockNextt. The information in this report and on the StockNextt website has been prepared from a wide variety of sources, which StockNextt, to the best of its knowledge and belief, considers accurate. StcokNextt has made every effort to ensure the reliability of information contained in its reports, newsletters, and websites. All information represents our views at the date of publication and may change without notice. The information in this report does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products. Our reports contain general recommendations for investing in securities and other financial products. StockNextt does not offer financial advice based upon your personal financial situation or goals, and we shall not be held liable for any investment or trading losses you may incur by using the opinions expressed in our reports, publications, market updates, news alerts and corporate profiles. StockNextt does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. StockNextt’s general advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested. Please also read our Terms and conditions for further information. Employees and/or associates of StockNextt and its related entities may hold an interest in the securities or other financial products covered in this report or on the StockNextt website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.
Copyright © 2023 Krish Capital Pty Ltd. All rights reserved. No part of this website, or its content, may be reproduced in any form without our prior consent.
