NOVO-NORDISK A/S-SPONS ADR (NVO)
US6701002056 - ADR
Overall NVO gets a fundamental rating of 7 out of 10. We evaluated NVO against 197 industry peers in the Pharmaceuticals industry. Both the health and profitability get an excellent rating, making NVO a very profitable company, without any liquidiy or solvency issues. NVO is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! This makes NVO very considerable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year NVO was profitable.
NVO had a positive operating cash flow in the past year.
NVO had positive earnings in each of the past 5 years.
Each year in the past 5 years NVO had a positive operating cash flow.
1.2 Ratios
NVO has a Return On Assets of 29.87%. This is amongst the best in the industry. NVO outperforms 98.46% of its industry peers.
NVO has a Return On Equity of 90.26%. This is amongst the best in the industry. NVO outperforms 98.46% of its industry peers.
NVO has a Return On Invested Capital of 65.80%. This is amongst the best in the industry. NVO outperforms 99.49% of its industry peers.
NVO had an Average Return On Invested Capital over the past 3 years of 50.71%. This is significantly above the industry average of 17.27%.
The 3 year average ROIC (50.71%) for NVO is below the current ROIC(65.80%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 29.87% | ||
| ROE | 90.26% | ||
| ROIC | 65.8% |
ROA(3y)24.73%
ROA(5y)26.85%
ROE(3y)70.85%
ROE(5y)69.34%
ROIC(3y)50.71%
ROIC(5y)53.98%
1.3 Margins
NVO's Profit Margin of 36.55% is amongst the best of the industry. NVO outperforms 96.41% of its industry peers.
NVO's Profit Margin has been stable in the last couple of years.
NVO has a Operating Margin of 44.80%. This is amongst the best in the industry. NVO outperforms 98.46% of its industry peers.
NVO's Operating Margin has been stable in the last couple of years.
NVO has a better Gross Margin (84.65%) than 87.18% of its industry peers.
NVO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.8% | ||
| PM (TTM) | 36.55% | ||
| GM | 84.65% |
OM growth 3Y1.58%
OM growth 5Y1.31%
PM growth 3Y2.77%
PM growth 5Y0.85%
GM growth 3Y0.43%
GM growth 5Y0.08%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so NVO is creating value.
The number of shares outstanding for NVO has been increased compared to 1 year ago.
Compared to 5 years ago, NVO has more shares outstanding
Compared to 1 year ago, NVO has an improved debt to assets ratio.
2.2 Solvency
NVO has an Altman-Z score of 14.18. This indicates that NVO is financially healthy and has little risk of bankruptcy at the moment.
NVO has a Altman-Z score of 14.18. This is amongst the best in the industry. NVO outperforms 90.26% of its industry peers.
The Debt to FCF ratio of NVO is 0.54, which is an excellent value as it means it would take NVO, only 0.54 years of fcf income to pay off all of its debts.
NVO has a better Debt to FCF ratio (0.54) than 96.41% of its industry peers.
A Debt/Equity ratio of 0.17 indicates that NVO is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.17, NVO perfoms like the industry average, outperforming 44.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.17 | ||
| Debt/FCF | 0.54 | ||
| Altman-Z | 14.18 |
ROIC/WACC9.43
WACC6.98%
2.3 Liquidity
NVO has a Current Ratio of 0.70. 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 has a Current ratio of 0.70. This is amonst the worse of the industry: NVO underperforms 92.82% of its industry peers.
A Quick Ratio of 0.50 indicates that NVO may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.50, NVO is doing worse than 93.33% of the companies in the same industry.
NVO does not score too well on the current and quick ratio evaluation. However, as it has 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 | 0.7 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
NVO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 48.22%, which is quite impressive.
Measured over the past 5 years, NVO shows a small growth in Earnings Per Share. The EPS has been growing by 3.16% on average per year.
The Revenue has grown by 29.72% in the past year. This is a very strong growth!
The Revenue has been growing by 15.74% on average over the past years. This is quite good.
EPS 1Y (TTM)48.22%
EPS 3Y1.11%
EPS 5Y3.16%
EPS growth Q2Q31.77%
Revenue 1Y (TTM)29.72%
Revenue growth 3Y22.31%
Revenue growth 5Y15.74%
Revenue growth Q2Q22.45%
3.2 Future
Based on estimates for the next years, NVO will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.88% on average per year.
Based on estimates for the next years, NVO will show a quite strong growth in Revenue. The Revenue will grow by 15.50% on average per year.
EPS Next Y26.98%
EPS Next 2Y24.4%
EPS Next 3Y22.9%
EPS Next 5Y15.88%
Revenue Next Year25.89%
Revenue Next 2Y23.3%
Revenue Next 3Y21.15%
Revenue Next 5Y15.5%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 45.66, which means the current valuation is very expensive for NVO.
Based on the Price/Earnings ratio, NVO is valued cheaply inside the industry as 80.51% of the companies are valued more expensively.
NVO is valuated expensively when we compare the Price/Earnings ratio to 28.32, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 31.73, the valuation of NVO can be described as expensive.
Based on the Price/Forward Earnings ratio, NVO is valued a bit cheaper than the industry average as 78.46% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.24, NVO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.66 | ||
| Fwd PE | 31.73 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NVO indicates a somewhat cheap valuation: NVO is cheaper than 77.95% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NVO indicates a somewhat cheap valuation: NVO is cheaper than 78.46% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 81.28 | ||
| EV/EBITDA | 33.16 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NVO has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as NVO's earnings are expected to grow with 22.90% in the coming years.
PEG (NY)1.69
PEG (5Y)14.43
EPS Next 2Y24.4%
EPS Next 3Y22.9%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.06%, NVO has a reasonable but not impressive dividend return.
NVO's Dividend Yield is rather good when compared to the industry average which is at 4.35. NVO pays more dividend than 91.28% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, NVO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of NVO is nicely growing with an annual growth rate of 11.24%!
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)11.24%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
47.03% of the earnings are spent on dividend by NVO. This is a bit on the high side, but may be sustainable.
The dividend of NVO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP47.03%
EPS Next 2Y24.4%
EPS Next 3Y22.9%
NOVO-NORDISK A/S-SPONS ADR
NYSE:NVO (5/13/2024, 7:04:00 PM)
After market: 132.8 +0.39 (+0.29%)132.41
+3.99 (+3.11%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
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Market Cap590.69B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.66 | ||
| Fwd PE | 31.73 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
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PEG (NY)1.69
PEG (5Y)14.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 29.87% | ||
| ROE | 90.26% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 44.8% | ||
| PM (TTM) | 36.55% | ||
| GM | 84.65% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
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ROCE(5y)
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ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
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PM growth 5Y
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F-Score
Asset Turnover0.82
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.17 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
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Profit Quality(3y)
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Growth
EPS 1Y (TTM)48.22%
EPS 3Y1.11%
EPS 5Y
EPS growth Q2Q
EPS Next Y26.98%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)29.72%
Revenue growth 3Y22.31%
Revenue growth 5Y
Revenue growth Q2Q
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Revenue Next 3Y
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