NOVO-NORDISK A/S-SPONS ADR (NVO) Stock Fundamental Analysis
USA - NYSE:NVO - US6701002056 - ADR
47.6 USD
-1.4 (-2.86%)
47.01 USD
-0.59 (-1.24%)
Overall NVO gets a fundamental rating of 7 out of 10. We evaluated NVO against 192 industry peers in the Pharmaceuticals industry. NVO has an excellent profitability rating, but there are some minor concerns on its financial health. NVO is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings would make NVO suitable for value investing!
1. Profitability
1.1 Basic Checks
NVO had positive earnings in the past year.
In the past year NVO had a positive cash flow from operations.
Each year in the past 5 years NVO has been profitable.
NVO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NVO's Return On Assets of 20.26% is amongst the best of the industry. NVO outperforms 97.92% of its industry peers.
NVO's Return On Equity of 61.08% is amongst the best of the industry. NVO outperforms 98.44% of its industry peers.
Looking at the Return On Invested Capital, with a value of 38.03%, NVO belongs to the top of the industry, outperforming 98.96% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for NVO is significantly above the industry average of 13.48%.
The last Return On Invested Capital (38.03%) for NVO is well below the 3 year average (50.29%), which needs to be investigated, but indicates that NVO had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.26% | ||
| ROE | 61.08% | ||
| ROIC | 38.03% |
ROA(3y)23.77%
ROA(5y)24.99%
ROE(3y)71.81%
ROE(5y)69.89%
ROIC(3y)50.29%
ROIC(5y)49.64%
1.3 Margins
With an excellent Profit Margin value of 32.88%, NVO belongs to the best of the industry, outperforming 96.88% of the companies in the same industry.
NVO's Profit Margin has improved in the last couple of years.
The Operating Margin of NVO (42.03%) is better than 97.92% of its industry peers.
In the last couple of years the Operating Margin of NVO has grown nicely.
NVO has a better Gross Margin (82.05%) than 85.94% of its industry peers.
NVO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 42.03% | ||
| PM (TTM) | 32.88% | ||
| GM | 82.05% |
OM growth 3Y4.3%
OM growth 5Y1.69%
PM growth 3Y0.84%
PM growth 5Y1.73%
GM growth 3Y0.72%
GM growth 5Y0.24%
2. Health
2.1 Basic Checks
NVO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
NVO has less shares outstanding than it did 1 year ago.
NVO has more shares outstanding than it did 5 years ago.
NVO has a worse debt/assets ratio than last year.
2.2 Solvency
NVO has an Altman-Z score of 4.27. This indicates that NVO is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.27, NVO is in the better half of the industry, outperforming 74.48% of the companies in the same industry.
NVO has a debt to FCF ratio of 1.66. This is a very positive value and a sign of high solvency as it would only need 1.66 years to pay back of all of its debts.
The Debt to FCF ratio of NVO (1.66) is better than 93.75% of its industry peers.
NVO has a Debt/Equity ratio of 0.52. This is a neutral value indicating NVO is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.52, NVO is doing worse than 62.50% of the companies in the same industry.
Although NVO does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | 1.66 | ||
| Altman-Z | 4.27 |
ROIC/WACC6.4
WACC5.94%
2.3 Liquidity
A Current Ratio of 0.78 indicates that NVO may have some problems paying its short term obligations.
NVO's Current ratio of 0.78 is on the low side compared to the rest of the industry. NVO is outperformed by 89.58% of its industry peers.
NVO has a Quick Ratio of 0.78. This is a bad value and indicates that NVO is not financially healthy enough and could expect problems in meeting its short term obligations.
NVO's Quick ratio of 0.57 is on the low side compared to the rest of the industry. NVO is outperformed by 89.58% of its industry peers.
The current and quick ratio evaluation for NVO is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 20.10% over the past year.
The Earnings Per Share has been growing slightly by 6.68% on average over the past years.
NVO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.64%.
Measured over the past years, NVO shows a quite strong growth in Revenue. The Revenue has been growing by 18.94% on average per year.
EPS 1Y (TTM)20.1%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%8.35%
Revenue 1Y (TTM)16.64%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%7.05%
3.2 Future
The Earnings Per Share is expected to grow by 7.77% on average over the next years.
The Revenue is expected to grow by 7.51% on average over the next years.
EPS Next Y5.73%
EPS Next 2Y6.44%
EPS Next 3Y6.78%
EPS Next 5Y7.77%
Revenue Next Year9.95%
Revenue Next 2Y7.78%
Revenue Next 3Y7.4%
Revenue Next 5Y7.51%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.05, which indicates a correct valuation of NVO.
NVO's Price/Earnings ratio is rather cheap when compared to the industry. NVO is cheaper than 88.02% of the companies in the same industry.
NVO's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.07.
The Price/Forward Earnings ratio is 11.96, which indicates a very decent valuation of NVO.
Based on the Price/Forward Earnings ratio, NVO is valued cheaper than 84.38% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 34.08. NVO is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.05 | ||
| Fwd PE | 11.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NVO is valued cheaply inside the industry as 89.58% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, NVO is valued cheaply inside the industry as 82.81% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.38 | ||
| EV/EBITDA | 9.54 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NVO does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of NVO may justify a higher PE ratio.
PEG (NY)2.1
PEG (5Y)1.8
EPS Next 2Y6.44%
EPS Next 3Y6.78%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.66%, NVO has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 7.07, NVO pays a better dividend. On top of this NVO pays more dividend than 95.83% of the companies listed in the same industry.
NVO's Dividend Yield is a higher than the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.66% |
5.2 History
On average, the dividend of NVO grows each year by 16.56%, which is quite nice.
NVO has paid a dividend for at least 10 years, which is a reliable track record.
NVO has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)16.56%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
NVO pays out 49.88% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of NVO is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP49.88%
EPS Next 2Y6.44%
EPS Next 3Y6.78%
47.6
-1.4 (-2.86%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners36.01%
Inst Owner Change-4.83%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap211.51B
Revenue(TTM)315.60B
Net Income(TTM)103.77B
Analysts74.19
Price Target71.36 (49.92%)
Short Float %0.68%
Short Ratio1.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.66% |
Yearly Dividend1.55
Dividend Growth(5Y)16.56%
DP49.88%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)13.98%
Min EPS beat(2)-1.15%
Max EPS beat(2)29.11%
EPS beat(4)3
Avg EPS beat(4)9.84%
Min EPS beat(4)-1.15%
Max EPS beat(4)29.11%
EPS beat(8)6
Avg EPS beat(8)6.27%
EPS beat(12)9
Avg EPS beat(12)4.6%
EPS beat(16)12
Avg EPS beat(16)3.86%
Revenue beat(2)0
Avg Revenue beat(2)-1.54%
Min Revenue beat(2)-2.48%
Max Revenue beat(2)-0.6%
Revenue beat(4)1
Avg Revenue beat(4)0.69%
Min Revenue beat(4)-2.48%
Max Revenue beat(4)6.95%
Revenue beat(8)3
Avg Revenue beat(8)0.68%
Revenue beat(12)6
Avg Revenue beat(12)0.55%
Revenue beat(16)9
Avg Revenue beat(16)0.81%
PT rev (1m)-6.81%
PT rev (3m)-15.81%
EPS NQ rev (1m)-3.14%
EPS NQ rev (3m)-4.1%
EPS NY rev (1m)-3.17%
EPS NY rev (3m)-11.69%
Revenue NQ rev (1m)-0.13%
Revenue NQ rev (3m)-2.13%
Revenue NY rev (1m)-0.33%
Revenue NY rev (3m)-4.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.05 | ||
| Fwd PE | 11.96 | ||
| P/S | 4.32 | ||
| P/FCF | 22.38 | ||
| P/OCF | 11.02 | ||
| P/B | 8.03 | ||
| P/tB | 21.54 | ||
| EV/EBITDA | 9.54 |
EPS(TTM)3.95
EY8.3%
EPS(NY)3.98
Fwd EY8.36%
FCF(TTM)2.13
FCFY4.47%
OCF(TTM)4.32
OCFY9.08%
SpS11.01
BVpS5.93
TBVpS2.21
PEG (NY)2.1
PEG (5Y)1.8
Graham Number22.96
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.26% | ||
| ROE | 61.08% | ||
| ROCE | 47.73% | ||
| ROIC | 38.03% | ||
| ROICexc | 43.08% | ||
| ROICexgc | 76.17% | ||
| OM | 42.03% | ||
| PM (TTM) | 32.88% | ||
| GM | 82.05% | ||
| FCFM | 19.31% |
ROA(3y)23.77%
ROA(5y)24.99%
ROE(3y)71.81%
ROE(5y)69.89%
ROIC(3y)50.29%
ROIC(5y)49.64%
ROICexc(3y)60.7%
ROICexc(5y)59.32%
ROICexgc(3y)124.92%
ROICexgc(5y)112.44%
ROCE(3y)63.71%
ROCE(5y)65.35%
ROICexgc growth 3Y-1.28%
ROICexgc growth 5Y0.46%
ROICexc growth 3Y-2.16%
ROICexc growth 5Y-9.95%
OM growth 3Y4.3%
OM growth 5Y1.69%
PM growth 3Y0.84%
PM growth 5Y1.73%
GM growth 3Y0.72%
GM growth 5Y0.24%
F-Score4
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | 1.66 | ||
| Debt/EBITDA | 0.58 | ||
| Cap/Depr | 290.66% | ||
| Cap/Sales | 19.91% | ||
| Interest Coverage | 53.02 | ||
| Cash Conversion | 80.23% | ||
| Profit Quality | 58.73% | ||
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.57 | ||
| Altman-Z | 4.27 |
F-Score4
WACC5.94%
ROIC/WACC6.4
Cap/Depr(3y)294.05%
Cap/Depr(5y)277.71%
Cap/Sales(3y)14.25%
Cap/Sales(5y)13.08%
Profit Quality(3y)89.38%
Profit Quality(5y)87.75%
High Growth Momentum
Growth
EPS 1Y (TTM)20.1%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%8.35%
EPS Next Y5.73%
EPS Next 2Y6.44%
EPS Next 3Y6.78%
EPS Next 5Y7.77%
Revenue 1Y (TTM)16.64%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%7.05%
Revenue Next Year9.95%
Revenue Next 2Y7.78%
Revenue Next 3Y7.4%
Revenue Next 5Y7.51%
EBIT growth 1Y6.92%
EBIT growth 3Y32.76%
EBIT growth 5Y20.94%
EBIT Next Year21.98%
EBIT Next 3Y13.55%
EBIT Next 5Y10.27%
FCF growth 1Y-21.68%
FCF growth 3Y13.52%
FCF growth 5Y14.4%
OCF growth 1Y16.27%
OCF growth 3Y30.05%
OCF growth 5Y20.93%
NOVO-NORDISK A/S-SPONS ADR / NVO FAQ
Can you provide the ChartMill fundamental rating for NOVO-NORDISK A/S-SPONS ADR?
ChartMill assigns a fundamental rating of 7 / 10 to NVO.
Can you provide the valuation status for NOVO-NORDISK A/S-SPONS ADR?
ChartMill assigns a valuation rating of 7 / 10 to NOVO-NORDISK A/S-SPONS ADR (NVO). This can be considered as Undervalued.
Can you provide the profitability details for NOVO-NORDISK A/S-SPONS ADR?
NOVO-NORDISK A/S-SPONS ADR (NVO) has a profitability rating of 9 / 10.
What is the financial health of NOVO-NORDISK A/S-SPONS ADR (NVO) stock?
The financial health rating of NOVO-NORDISK A/S-SPONS ADR (NVO) is 6 / 10.
Can you provide the dividend sustainability for NVO stock?
The dividend rating of NOVO-NORDISK A/S-SPONS ADR (NVO) is 6 / 10 and the dividend payout ratio is 49.88%.