Teva Pharmaceutical Industries (NYSE:TEVA) is a selection for the real-money Inflation-Protected Income Growth portfolio. In this brief video, portfolio manager Chuck Saletta offers three reasons why he's holding on to Teva's stock despite the company's recent challenges and the fact that its shares are essentially at the level he bought them at last year.

In summary:

  • Teva's market capitalization isn't much above my revised fair-value estimate.
  • Teva's balance sheet remains strong:
  • Teva's dividend remains covered, probably better than its 85% payout ratio suggests.

What problems has Teva faced in 2013?
As mentioned in the video, Teva has had its share of problems in 2013. Two of the biggest were the early patent loss on its blockbuster drug Copaxone and the surprise resignation of CEO Jeremy Levin. Litigation costs in the second quarter of 2013 also pushed the company's earnings negative for the quarter. If those litigation costs were truly a one-time occurrence, then the company's earnings power and dividend coverage are stronger than its historical numbers would suggest. Only time -- and the company's future operations -- will tell.

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Chuck Saletta owns shares of Teva Pharmaceutical Industries. The Motley Fool recommends Teva Pharmaceutical Industries. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.