NOVARTIS AG-SPONSORED ADR (NVS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NVS - US66987V1098 - ADR
141.82 USD
+0.28 (+0.2%)
142.27 USD
+0.45 (+0.32%)
Taking everything into account, NVS scores 7 out of 10 in our fundamental rating. NVS was compared to 190 industry peers in the Pharmaceuticals industry. NVS gets an excellent profitability rating and is at the same time showing great financial health properties. NVS scores decently on growth, while it is valued quite cheap. This could make an interesting combination. These ratings would make NVS suitable for value 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.
NVS had positive earnings in each of the past 5 years.
NVS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NVS's Return On Assets of 13.42% is amongst the best of the industry. NVS outperforms 94.21% of its industry peers.
The Return On Equity of NVS (32.47%) is better than 94.21% of its industry peers.
With an excellent Return On Invested Capital value of 22.36%, NVS belongs to the best of the industry, outperforming 97.37% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NVS is in line with the industry average of 12.84%.
The last Return On Invested Capital (22.36%) for NVS is above the 3 year average (14.58%), which is a sign of increasing profitability.
| 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
NVS has a Profit Margin of 25.69%. This is amongst the best in the industry. NVS outperforms 92.11% of its industry peers.
In the last couple of years the Profit Margin of NVS has remained more or less at the same level.
NVS's Operating Margin of 33.11% is amongst the best of the industry. NVS outperforms 94.74% of its industry peers.
In the last couple of years the Operating Margin of NVS has grown nicely.
Looking at the Gross Margin, with a value of 76.10%, NVS belongs to the top of the industry, outperforming 82.11% of the companies in the same industry.
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.
The number of shares outstanding for NVS has been reduced compared to 1 year ago.
Compared to 5 years ago, NVS has less shares outstanding
Compared to 1 year ago, NVS has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.21 indicates that NVS is not in any danger for bankruptcy at the moment.
The Altman-Z score of NVS (4.21) is better than 71.05% of its industry peers.
NVS has a debt to FCF ratio of 1.87. This is a very positive value and a sign of high solvency as it would only need 1.87 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.87, NVS belongs to the best of the industry, outperforming 94.21% of the companies in the same industry.
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 Debt to Equity ratio of 0.55. This is in the lower half of the industry: NVS underperforms 65.79% of its industry peers.
Even though the debt/equity ratio score it not favorable for NVS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 1.87 | ||
| Altman-Z | 4.21 |
ROIC/WACC4.65
WACC4.81%
2.3 Liquidity
A Current Ratio of 0.88 indicates that NVS may have some problems paying its short term obligations.
With a Current ratio value of 0.88, NVS is not doing good in the industry: 87.37% of the companies in the same industry are doing better.
NVS has a Quick Ratio of 0.88. This is a bad value and indicates that NVS is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of NVS (0.68) is worse than 86.84% of its industry peers.
The current and quick ratio evaluation for NVS 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 | 0.88 | ||
| Quick Ratio | 0.68 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 21.33% over the past year.
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.
The Revenue has grown by 12.18% in the past year. This is quite good.
The Revenue has been growing slightly by 1.24% on average over the past years.
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.
NVS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.27% yearly.
EPS Next Y16.78%
EPS Next 2Y9.31%
EPS Next 3Y8.66%
EPS Next 5Y8.79%
Revenue Next Year9.91%
Revenue Next 2Y6.24%
Revenue Next 3Y5.54%
Revenue Next 5Y5.27%
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 stable.
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
NVS is valuated correctly with a Price/Earnings ratio of 15.71.
Compared to the rest of the industry, the Price/Earnings ratio of NVS indicates a rather cheap valuation: NVS is cheaper than 86.32% of the companies listed in the same industry.
NVS's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.25.
The Price/Forward Earnings ratio is 15.03, which indicates a correct valuation of NVS.
82.11% of the companies in the same industry are more expensive than NVS, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 23.98. NVS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.71 | ||
| Fwd PE | 15.03 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NVS is valued cheaper than 84.21% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, NVS is valued cheaply inside the industry as 87.37% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.95 | ||
| EV/EBITDA | 12.29 |
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)0.94
PEG (5Y)1.93
EPS Next 2Y9.31%
EPS Next 3Y8.66%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.86%, NVS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 0.35, NVS pays a better dividend. On top of this NVS pays more dividend than 93.68% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.92, NVS has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.86% |
5.2 History
The dividend of NVS has a limited annual growth rate of 5.49%.
NVS has been paying a dividend for at least 10 years, so it has a reliable track record.
As NVS did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)5.49%
Div Incr Years5
Div Non Decr Years5
5.3 Sustainability
54.32% of the earnings are spent on dividend by NVS. 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 2Y9.31%
EPS Next 3Y8.66%
141.82
+0.28 (+0.2%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners41.44%
Inst Owner Change0.01%
Ins Owners0.01%
Ins Owner ChangeN/A
Market Cap272.12B
Revenue(TTM)56.02B
Net Income(TTM)14.39B
Analysts71.25
Price Target135.04 (-4.78%)
Short Float %0.31%
Short Ratio3.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.86% |
Yearly Dividend3.79
Dividend Growth(5Y)5.49%
DP54.32%
Div Incr Years5
Div Non Decr Years5
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.75%
Min EPS beat(2)-2.1%
Max EPS beat(2)0.61%
EPS beat(4)3
Avg EPS beat(4)2.79%
Min EPS beat(4)-2.1%
Max EPS beat(4)6.59%
EPS beat(8)6
Avg EPS beat(8)2.02%
EPS beat(12)10
Avg EPS beat(12)3.45%
EPS beat(16)11
Avg EPS beat(16)2.48%
Revenue beat(2)0
Avg Revenue beat(2)-2.83%
Min Revenue beat(2)-2.84%
Max Revenue beat(2)-2.82%
Revenue beat(4)1
Avg Revenue beat(4)-1.5%
Min Revenue beat(4)-2.84%
Max Revenue beat(4)0.78%
Revenue beat(8)2
Avg Revenue beat(8)-1.48%
Revenue beat(12)3
Avg Revenue beat(12)-3.77%
Revenue beat(16)4
Avg Revenue beat(16)-4.02%
PT rev (1m)0%
PT rev (3m)2.66%
EPS NQ rev (1m)-0.6%
EPS NQ rev (3m)0.44%
EPS NY rev (1m)0.08%
EPS NY rev (3m)0.37%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)0.73%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.71 | ||
| Fwd PE | 15.03 | ||
| P/S | 4.86 | ||
| P/FCF | 15.95 | ||
| P/OCF | 12.91 | ||
| P/B | 6.14 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.29 |
EPS(TTM)9.03
EY6.37%
EPS(NY)9.44
Fwd EY6.65%
FCF(TTM)8.89
FCFY6.27%
OCF(TTM)10.98
OCFY7.74%
SpS29.2
BVpS23.1
TBVpS-5.35
PEG (NY)0.94
PEG (5Y)1.93
Graham Number68.51
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.42% | ||
| ROE | 32.47% | ||
| ROCE | 24.64% | ||
| ROIC | 22.36% | ||
| ROICexc | 25.65% | ||
| ROICexgc | 152.58% | ||
| OM | 33.11% | ||
| PM (TTM) | 25.69% | ||
| GM | 76.1% | ||
| FCFM | 30.45% |
ROA(3y)10.82%
ROA(5y)11.4%
ROE(3y)23.55%
ROE(5y)24.08%
ROIC(3y)14.58%
ROIC(5y)12.83%
ROICexc(3y)17.82%
ROICexc(5y)15.74%
ROICexgc(3y)90.48%
ROICexgc(5y)78.58%
ROCE(3y)16.96%
ROCE(5y)14.93%
ROICexgc growth 3Y14.29%
ROICexgc growth 5Y25.26%
ROICexc growth 3Y20.9%
ROICexc growth 5Y13.17%
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%
F-Score7
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.55 | ||
| Debt/FCF | 1.87 | ||
| Debt/EBITDA | 1.01 | ||
| Cap/Depr | 74.31% | ||
| Cap/Sales | 7.16% | ||
| Interest Coverage | 18.85 | ||
| Cash Conversion | 87.98% | ||
| Profit Quality | 118.52% | ||
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.68 | ||
| Altman-Z | 4.21 |
F-Score7
WACC4.81%
ROIC/WACC4.65
Cap/Depr(3y)51.13%
Cap/Depr(5y)48.4%
Cap/Sales(3y)6.48%
Cap/Sales(5y)6.27%
Profit Quality(3y)120.24%
Profit Quality(5y)109.63%
High Growth Momentum
Growth
EPS 1Y (TTM)21.33%
EPS 3Y7.48%
EPS 5Y8.14%
EPS Q2Q%9.22%
EPS Next Y16.78%
EPS Next 2Y9.31%
EPS Next 3Y8.66%
EPS Next 5Y8.79%
Revenue 1Y (TTM)12.18%
Revenue growth 3Y5.56%
Revenue growth 5Y1.24%
Sales Q2Q%8.47%
Revenue Next Year9.91%
Revenue Next 2Y6.24%
Revenue Next 3Y5.54%
Revenue Next 5Y5.27%
EBIT growth 1Y21.58%
EBIT growth 3Y14.18%
EBIT growth 5Y7.57%
EBIT Next Year36.14%
EBIT Next 3Y13.19%
EBIT Next 5Y13.01%
FCF growth 1Y33.72%
FCF growth 3Y4.49%
FCF growth 5Y3.96%
OCF growth 1Y37.07%
OCF growth 3Y5.34%
OCF growth 5Y5.28%
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 6 / 10 and the dividend payout ratio is 54.32%.