NOVARTIS AG-SPONSORED ADR (NVS) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:NVS • US66987V1098
148.68 USD
-0.23 (-0.15%)
At close: Jan 30, 2026
145.08 USD
-3.6 (-2.42%)
After Hours: 1/30/2026, 8:09:44 PM
NVS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 191 industry peers in the Pharmaceuticals industry. NVS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. A decent growth rate in combination with a cheap valuation! Better keep an eye on NVS. Finally NVS also has an excellent dividend rating. These ratings would make NVS suitable for value and dividend and quality investing!
1. Profitability
1.1 Basic Checks
- NVS had positive earnings in the past year.
- NVS had a positive operating cash flow in the past year.
- Each year in the past 5 years NVS has been profitable.
- NVS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- NVS has a Return On Assets of 13.42%. This is amongst the best in the industry. NVS outperforms 94.24% of its industry peers.
- Looking at the Return On Equity, with a value of 32.47%, NVS belongs to the top of the industry, outperforming 94.24% of the companies in the same industry.
- NVS has a better Return On Invested Capital (22.36%) than 97.38% of its industry peers.
- NVS had an Average Return On Invested Capital over the past 3 years of 14.58%. This is in line with the industry average of 12.82%.
- The 3 year average ROIC (14.58%) for NVS is below the current ROIC(22.36%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.42% | ||
| ROE | 32.47% | ||
| ROIC | 22.36% |
ROA(3y)10.82%
ROA(5y)11.4%
ROE(3y)23.55%
ROE(5y)24.08%
ROIC(3y)14.58%
ROIC(5y)12.83%
1.3 Margins
- With an excellent Profit Margin value of 25.69%, NVS belongs to the best of the industry, outperforming 92.15% of the companies in the same industry.
- NVS's Profit Margin has been stable in the last couple of years.
- Looking at the Operating Margin, with a value of 33.11%, NVS belongs to the top of the industry, outperforming 94.76% of the companies in the same industry.
- In the last couple of years the Operating Margin of NVS has grown nicely.
- The Gross Margin of NVS (76.10%) is better than 82.20% of its industry peers.
- NVS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.11% | ||
| PM (TTM) | 25.69% | ||
| GM | 76.1% |
OM growth 3Y8.17%
OM growth 5Y6.25%
PM growth 3Y-24.95%
PM growth 5Y-0.88%
GM growth 3Y0.5%
GM growth 5Y1.06%
2. Health
2.1 Basic Checks
- NVS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- Compared to 1 year ago, NVS has less shares outstanding
- NVS has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, NVS has a worse debt to assets ratio.
2.2 Solvency
- NVS has an Altman-Z score of 4.34. This indicates that NVS is financially healthy and has little risk of bankruptcy at the moment.
- NVS has a Altman-Z score of 4.34. This is in the better half of the industry: NVS outperforms 71.20% of its industry peers.
- The Debt to FCF ratio of NVS is 1.87, which is an excellent value as it means it would take NVS, only 1.87 years of fcf income to pay off all of its debts.
- NVS's Debt to FCF ratio of 1.87 is amongst the best of the industry. NVS outperforms 94.24% of its industry peers.
- NVS has a Debt/Equity ratio of 0.55. This is a neutral value indicating NVS is somewhat dependend on debt financing.
- NVS has a worse Debt to Equity ratio (0.55) than 65.44% of its industry peers.
- Although NVS 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 | 0.55 | ||
| Debt/FCF | 1.87 | ||
| Altman-Z | 4.34 |
ROIC/WACC4.59
WACC4.87%
2.3 Liquidity
- A Current Ratio of 0.88 indicates that NVS may have some problems paying its short term obligations.
- The Current ratio of NVS (0.88) is worse than 86.91% of its industry peers.
- A Quick Ratio of 0.68 indicates that NVS may have some problems paying its short term obligations.
- The Quick ratio of NVS (0.68) is worse than 86.91% of its industry peers.
- NVS 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 | 0.88 | ||
| Quick Ratio | 0.68 |
3. Growth
3.1 Past
- NVS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.33%, which is quite impressive.
- Measured over the past years, NVS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.14% on average per year.
- Looking at the last year, NVS shows a quite strong growth in Revenue. The Revenue has grown by 12.18% in the last year.
- Measured over the past years, NVS shows a small growth in Revenue. The Revenue has been growing by 1.24% on average per year.
EPS 1Y (TTM)21.33%
EPS 3Y7.48%
EPS 5Y8.14%
EPS Q2Q%9.22%
Revenue 1Y (TTM)12.18%
Revenue growth 3Y5.56%
Revenue growth 5Y1.24%
Sales Q2Q%8.47%
3.2 Future
- Based on estimates for the next years, NVS will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.79% on average per year.
- The Revenue is expected to grow by 5.27% on average over the next years.
EPS Next Y16.8%
EPS Next 2Y9.28%
EPS Next 3Y8.59%
EPS Next 5Y8.79%
Revenue Next Year9.91%
Revenue Next 2Y6.24%
Revenue Next 3Y5.54%
Revenue Next 5Y5.27%
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.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 16.47, NVS is valued correctly.
- Compared to the rest of the industry, the Price/Earnings ratio of NVS indicates a rather cheap valuation: NVS is cheaper than 84.82% of the companies listed in the same industry.
- NVS is valuated rather cheaply 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 15.77, the valuation of NVS can be described as correct.
- NVS's Price/Forward Earnings ratio is rather cheap when compared to the industry. NVS is cheaper than 82.72% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of NVS to the average of the S&P500 Index (25.57), we can say NVS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.47 | ||
| Fwd PE | 15.77 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NVS indicates a rather cheap valuation: NVS is cheaper than 84.29% of the companies listed in the same industry.
- 86.39% of the companies in the same industry are more expensive than NVS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.72 | ||
| EV/EBITDA | 12.84 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- NVS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.98
PEG (5Y)2.02
EPS Next 2Y9.28%
EPS Next 3Y8.59%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.06%, NVS has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.62, NVS pays a better dividend. On top of this NVS pays more dividend than 93.72% of the companies listed in the same industry.
- NVS's Dividend Yield is rather good when compared to the S&P500 average which is at 1.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.06% |
5.2 History
- The dividend of NVS has a limited annual growth rate of 5.49%.
- NVS has paid a dividend for at least 10 years, which is a reliable track record.
- NVS has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)5.49%
Div Incr Years5
Div Non Decr Years5
5.3 Sustainability
- NVS pays out 54.32% of its income as dividend. This is a bit on the high side, but may be sustainable.
- NVS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP54.32%
EPS Next 2Y9.28%
EPS Next 3Y8.59%
NOVARTIS AG-SPONSORED ADR / NVS FAQ
What is the ChartMill fundamental rating of NOVARTIS AG-SPONSORED ADR (NVS) stock?
ChartMill assigns a fundamental rating of 7 / 10 to NVS.
What is the valuation status for NVS stock?
ChartMill assigns a valuation rating of 7 / 10 to NOVARTIS AG-SPONSORED ADR (NVS). This can be considered as Undervalued.
How profitable is NOVARTIS AG-SPONSORED ADR (NVS) stock?
NOVARTIS AG-SPONSORED ADR (NVS) has a profitability rating of 9 / 10.
How financially healthy is NOVARTIS AG-SPONSORED ADR?
The financial health rating of NOVARTIS AG-SPONSORED ADR (NVS) is 7 / 10.
Is the dividend of NOVARTIS AG-SPONSORED ADR sustainable?
The dividend rating of NOVARTIS AG-SPONSORED ADR (NVS) is 7 / 10 and the dividend payout ratio is 54.32%.