At The Motley Fool, we poke plenty of fun at Wall Street analysts and their endless cycle of upgrades, downgrades, and "initiating coverage at neutral." So you might think we'd be the last people to give virtual ink to such "news." And we would be -- if that were all we were doing.

But in "This Just In," we don't simply tell you what the analysts said. We'll also show you whether they know what they're talking about. To help, we've enlisted Motley Fool CAPS, our tool for rating stocks and analysts alike. With CAPS, we track the long-term performance of Wall Street's best and brightest -- and its worst and sorriest, too.

And speaking of the best...
Is it finally time to buy Teva Pharmaceuticals (Nasdaq: TEVA)? Yesterday, my Foolish colleague Jim Mueller laid out the reasons why we are buying it. Now Oppenheimer & Co. seems to be nodding in agreement.

Yesterday was a very busy day for drug stocks. While everyone was tossing around Teva ratings, Stifel Nicolaus came out with new buy ratings for Amgen (Nasdaq: AMGN), Celgene (Nasdaq: CELG), and Human Genome Sciences (Nasdaq: HGSI), along with a rare sell suggestion on Biogen Idec. Meanwhile, Oppenheimer raised its rating on Teva from "neutral" to "buy" yesterday. Did the strength of Jim's arguments convince Oppenheimer? Perhaps, but...

Let's go to the tape
... Oppenheimer has proven itself a mighty fine stock picker in its own right. The analyst ranks in the top quintile of investors we track here at CAPS. Its record in the Pharmaceuticals space is particularly good. With 53% accuracy on its picks, the average Oppenheimer Pharma rec beats the market by better than 8 percentage points. Here are a few of Oppy's more recent recommendations:


Oppenheimer Says:

CAPS says:

Oppenheimer's Picks Beating (Lagging) S&P By:



Not rated

62 points

WuXi PharmaTech  



53 points

Questcor Pharma



14 points

Why does Oppenheimer like Teva today? Profits. Praising the strength of Teva's launch for the generic of Effexor XR antidepressant drug, Oppenheimer predicts we'll see a sharp uptick in earnings in the second half of 2010.

Interestingly, this plays right into the major thesis Jim outlined for us yesterday. Calling Teva "the No. 1 generic-drug company in the world at a time when many big-selling branded drugs are beginning to come off patent," Jim expects to see Teva capitalize on the same trend that's stealing profits from its larger rivals. As drugs owned by Eli Lilly (NYSE: LLY), Merck (NYSE: MRK), and Pfizer (NYSE: PFE) fall off a patent cliff, Teva's standing at the bottom of that drop with open arms, promising to profit from selling the same drugs in generic form. Indeed, Pfizer's loss has become Teva's Effexor-fueled gain.

Profit from Pfizer's misery
While I feel the pain of Pfizer shareholders, I cannot ignore the value in Teva shares. Selling for less than 16 times free cash flow, paying a 1.3% dividend and projected to grow earnings at better than 14% per year over the next five years, Teva looks to me today like a fairly priced stock, with little downside risk and a whole pile of upside.

Most analysts today expect to see this company grow its earnings more than 35% this year. It won't take many more "Effexors" to make their effects clear on the long-term growth rate. If Oppenheimer's right about the strength of sales of this single drug, and if Jim's proven right about Teva's ability to steal even more sales from Big Pharma as its drug patents lapse, we could see Teva's growth rate exceed even Wall Street's forecasts -- pushing the stock into definite value territory.

If you agree with Jim's and Oppenheimer's outlooks, consider buying Teva before the good news becomes common knowledge.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community.

Pfizer is a Motley Fool Inside Value selection, but Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 613 out of more than 165,000 members. The Motley Fool has a disclosure policy.