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
Taking everything into account, NVS scores 7 out of 10 in our fundamental rating. NVS was compared to 191 industry peers in the Pharmaceuticals industry. Both the health and profitability get an excellent rating, making NVS a very profitable company, without any liquidiy or solvency issues. NVS scores decently on growth, while it is valued quite cheap. This could make an interesting combination. NVS also has an excellent dividend rating. These ratings could make NVS a good candidate 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.
- Each year in the past 5 years NVS had a positive operating cash flow.
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.
- NVS has a better Return On Equity (32.47%) than 94.24% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 22.36%, NVS belongs to the top of the industry, outperforming 97.38% 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 12.82%.
- 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
- Looking at the Profit Margin, with a value of 25.69%, NVS belongs to the top of the industry, outperforming 92.15% of the companies in the same industry.
- In the last couple of years the Profit Margin of NVS has remained more or less at the same level.
- The Operating Margin of NVS (33.11%) is better than 94.76% of its industry peers.
- In the last couple of years the Operating Margin of NVS has grown nicely.
- NVS has a Gross Margin of 76.10%. This is amongst the best in the industry. NVS outperforms 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
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), NVS is creating value.
- Compared to 1 year ago, NVS has less shares outstanding
- The number of shares outstanding for NVS has been reduced compared to 5 years ago.
- The debt/assets ratio for NVS is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 4.34 indicates that NVS is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 4.34, NVS is doing good in the industry, outperforming 71.20% of the companies in the same industry.
- 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 Debt to Equity ratio of 0.55. This is in the lower half of the industry: NVS underperforms 65.44% 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 | 4.34 |
ROIC/WACC4.71
WACC4.75%
2.3 Liquidity
- A Current Ratio of 0.88 indicates that NVS may have some problems paying its short term obligations.
- NVS has a Current ratio of 0.88. This is amonst the worse of the industry: NVS underperforms 86.91% of its industry peers.
- A Quick Ratio of 0.68 indicates that NVS may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.68, NVS is doing worse than 86.91% of the companies in the same industry.
- 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.
- The Earnings Per Share has been growing by 8.14% on average over the past years. This is quite good.
- Looking at the last year, NVS shows a quite strong growth in Revenue. The Revenue has grown by 12.18% in the last year.
- 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
- NVS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.79% yearly.
- NVS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.27% yearly.
EPS Next Y16.8%
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
- 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
- A Price/Earnings ratio of 16.47 indicates a correct valuation of NVS.
- NVS's Price/Earnings ratio is rather cheap when compared to the industry. NVS is cheaper than 84.82% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.32, NVS is valued a bit cheaper.
- The Price/Forward Earnings ratio is 15.77, which indicates a correct valuation of NVS.
- Based on the Price/Forward Earnings ratio, NVS is valued cheaply inside the industry as 82.72% of the companies are valued more expensively.
- NVS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.
| 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.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of NVS indicates a rather cheap valuation: NVS is cheaper than 86.39% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.72 | ||
| EV/EBITDA | 12.84 |
4.3 Compensation for Growth
- NVS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The excellent profitability rating of NVS 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.
- NVS's Dividend Yield is rather good when compared to the industry average which is at 0.62. NVS pays more dividend than 93.72% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.83, NVS pays a better dividend.
| 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.
- 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 2Y9.28%
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%.