NOVO-NORDISK A/S-SPONS ADR (NVO)
US6701002056 - ADR
Taking everything into account, NVO scores 7 out of 10 in our fundamental rating. NVO was compared to 194 industry peers in the Pharmaceuticals industry. NVO has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. NVO is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! These ratings could make NVO a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
NVO had positive earnings in the past year.
NVO had a positive operating cash flow in the past year.
In the past 5 years NVO has always 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 23.83% is amongst the best of the industry. NVO outperforms 98.96% of its industry peers.
NVO's Return On Equity of 78.59% is amongst the best of the industry. NVO outperforms 98.44% of its industry peers.
NVO has a better Return On Invested Capital (52.61%) than 98.96% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NVO is significantly above the industry average of 42.22%.
The 3 year average ROIC (50.71%) for NVO is below the current ROIC(52.61%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.83% | ||
| ROE | 78.59% | ||
| ROIC | 52.61% |
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
Looking at the Profit Margin, with a value of 35.01%, NVO belongs to the top of the industry, outperforming 97.92% of the companies in the same industry.
In the last couple of years the Profit Margin of NVO has remained more or less at the same level.
Looking at the Operating Margin, with a value of 45.85%, NVO belongs to the top of the industry, outperforming 98.44% of the companies in the same industry.
In the last couple of years the Operating Margin of NVO has remained more or less at the same level.
With an excellent Gross Margin value of 84.66%, NVO belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
In the last couple of years the Gross Margin of NVO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.85% | ||
| PM (TTM) | 35.01% | ||
| GM | 84.66% |
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
NVO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for NVO has been increased compared to 1 year ago.
NVO has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, NVO has an improved debt to assets ratio.
2.2 Solvency
NVO has an Altman-Z score of 9.26. This indicates that NVO is financially healthy and has little risk of bankruptcy at the moment.
NVO has a Altman-Z score of 9.26. This is amongst the best in the industry. NVO outperforms 84.90% of its industry peers.
NVO has a debt to FCF ratio of 0.85. This is a very positive value and a sign of high solvency as it would only need 0.85 years to pay back of all of its debts.
The Debt to FCF ratio of NVO (0.85) is better than 96.35% of its industry peers.
A Debt/Equity ratio of 0.43 indicates that NVO is not too dependend on debt financing.
The Debt to Equity ratio of NVO (0.43) is worse than 61.98% of its industry peers.
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 | 0.43 | ||
| Debt/FCF | 0.85 | ||
| Altman-Z | 9.26 |
ROIC/WACC7.85
WACC6.7%
2.3 Liquidity
A Current Ratio of 0.94 indicates that NVO may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.94, NVO is doing worse than 86.98% of the companies in the same industry.
NVO has a Quick Ratio of 0.94. 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 Quick ratio of 0.75. This is amonst the worse of the industry: NVO underperforms 85.94% 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 | 0.94 | ||
| Quick Ratio | 0.75 |
3. Growth
3.1 Past
NVO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 27.44%, 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.
Looking at the last year, NVO shows a very strong growth in Revenue. The Revenue has grown by 26.15%.
Measured over the past years, NVO shows a quite strong growth in Revenue. The Revenue has been growing by 15.74% on average per year.
EPS 1Y (TTM)27.44%
EPS 3Y1.11%
EPS 5Y3.16%
EPS Q2Q%24.76%
Revenue 1Y (TTM)26.15%
Revenue growth 3Y22.31%
Revenue growth 5Y15.74%
Sales Q2Q%24.11%
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 16.66% on average per year.
The Revenue is expected to grow by 15.91% on average over the next years. This is quite good.
EPS Next Y23.18%
EPS Next 2Y24.57%
EPS Next 3Y23.3%
EPS Next 5Y16.66%
Revenue Next Year25.41%
Revenue Next 2Y22.91%
Revenue Next 3Y21.14%
Revenue Next 5Y15.91%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 34.02, NVO can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of NVO indicates a rather cheap valuation: NVO is cheaper than 80.21% of the companies listed in the same industry.
NVO's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.65.
Based on the Price/Forward Earnings ratio of 25.12, the valuation of NVO can be described as expensive.
Based on the Price/Forward Earnings ratio, NVO is valued a bit cheaper than 77.08% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.56. NVO is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.02 | ||
| Fwd PE | 25.12 |
4.2 Price Multiples
79.17% of the companies in the same industry are more expensive than NVO, based on the Enterprise Value to EBITDA ratio.
79.69% of the companies in the same industry are more expensive than NVO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 48.34 | ||
| EV/EBITDA | 23.22 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of NVO may justify a higher PE ratio.
A more expensive valuation may be justified as NVO's earnings are expected to grow with 23.30% in the coming years.
PEG (NY)1.47
PEG (5Y)10.75
EPS Next 2Y24.57%
EPS Next 3Y23.3%
5. Dividend
5.1 Amount
NVO has a Yearly Dividend Yield of 1.32%.
The stock price of NVO dropped by -23.14% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 4.28, NVO pays a better dividend. On top of this NVO pays more dividend than 91.15% of the companies listed in the same industry.
With a Dividend Yield of 1.32, NVO pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
5.2 History
On average, the dividend of NVO grows each year by 11.24%, which is quite nice.
NVO has paid a dividend for at least 10 years, which is a reliable track record.
As NVO did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)11.24%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
NVO pays out 46.60% of its income as dividend. This is a bit on the high side, but may be sustainable.
NVO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP46.6%
EPS Next 2Y24.57%
EPS Next 3Y23.3%
NOVO-NORDISK A/S-SPONS ADR
NYSE:NVO (11/21/2024, 1:54:07 PM)
103.077
-2.19 (-2.08%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap458.77B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.02 | ||
| Fwd PE | 25.12 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.47
PEG (5Y)10.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.83% | ||
| ROE | 78.59% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 45.85% | ||
| PM (TTM) | 35.01% | ||
| GM | 84.66% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.75 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)27.44%
EPS 3Y1.11%
EPS 5Y
EPS Q2Q%
EPS Next Y23.18%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)26.15%
Revenue growth 3Y22.31%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y