NOVARTIS AG-SPONSORED ADR (NVS)
US66987V1098 - ADR
NVS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 194 industry peers in the Pharmaceuticals industry. NVS has an excellent profitability rating, but there are some minor concerns on its financial health. NVS may be a bit undervalued, certainly considering the very reasonable score on growth Finally NVS also has an excellent dividend rating. This makes NVS very considerable for value and dividend 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.
In the past 5 years NVS has always 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 18.59%. This is amongst the best in the industry. NVS outperforms 98.44% of its industry peers.
Looking at the Return On Equity, with a value of 44.20%, NVS belongs to the top of the industry, outperforming 96.35% of the companies in the same industry.
The Return On Invested Capital of NVS (22.45%) is better than 96.88% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NVS is significantly below the industry average of 42.22%.
The 3 year average ROIC (11.23%) for NVS is below the current ROIC(22.45%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.59% | ||
| ROE | 44.2% | ||
| ROIC | 22.45% |
ROA(3y)13%
ROA(5y)11.05%
ROE(3y)26.35%
ROE(5y)22.89%
ROIC(3y)11.23%
ROIC(5y)11.01%
1.3 Margins
NVS has a better Profit Margin (29.84%) than 96.88% of its industry peers.
NVS's Profit Margin has improved in the last couple of years.
NVS has a better Operating Margin (27.87%) than 92.71% of its industry peers.
NVS's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 74.29%, NVS belongs to the best of the industry, outperforming 81.77% of the companies in the same industry.
In the last couple of years the Gross Margin of NVS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.87% | ||
| PM (TTM) | 29.84% | ||
| GM | 74.29% |
OM growth 3Y3.15%
OM growth 5Y4.74%
PM growth 3Y25.3%
PM growth 5Y3.04%
GM growth 3Y1.43%
GM growth 5Y1.03%
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.
NVS has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, NVS has less shares outstanding
NVS has a worse debt/assets ratio than last year.
2.2 Solvency
NVS has an Altman-Z score of 4.03. This indicates that NVS is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.03, NVS is doing good in the industry, outperforming 77.60% of the companies in the same industry.
The Debt to FCF ratio of NVS is 2.63, which is a good value as it means it would take NVS, 2.63 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 2.63, NVS belongs to the best of the industry, outperforming 93.23% of the companies in the same industry.
A Debt/Equity ratio of 0.47 indicates that NVS is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.47, NVS is not doing good in the industry: 63.02% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 2.63 | ||
| Altman-Z | 4.03 |
ROIC/WACC4.69
WACC4.79%
2.3 Liquidity
A Current Ratio of 0.90 indicates that NVS may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.90, NVS is doing worse than 88.02% of the companies in the same industry.
NVS has a Quick Ratio of 0.90. This is a bad value and indicates that NVS is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.71, NVS is doing worse than 88.02% of the companies in the same industry.
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 | 0.9 | ||
| Quick Ratio | 0.71 |
3. Growth
3.1 Past
NVS shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.82%.
The Earnings Per Share has been growing slightly by 6.11% on average over the past years.
NVS shows a small growth in Revenue. In the last year, the Revenue has grown by 7.57%.
The Revenue has been growing slightly by 0.28% on average over the past years.
EPS 1Y (TTM)6.82%
EPS 3Y6.08%
EPS 5Y6.11%
EPS Q2Q%12.57%
Revenue 1Y (TTM)7.57%
Revenue growth 3Y-2.21%
Revenue growth 5Y0.28%
Sales Q2Q%8.84%
3.2 Future
Based on estimates for the next years, NVS will show a small growth in Earnings Per Share. The EPS will grow by 6.31% on average per year.
The Revenue is expected to grow by 2.65% on average over the next years.
EPS Next Y11.87%
EPS Next 2Y9.87%
EPS Next 3Y8.83%
EPS Next 5Y6.31%
Revenue Next Year7.56%
Revenue Next 2Y6.04%
Revenue Next 3Y4.7%
Revenue Next 5Y2.65%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.96, NVS is valued correctly.
Based on the Price/Earnings ratio, NVS is valued cheaply inside the industry as 89.06% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of NVS to the average of the S&P500 Index (28.96), we can say NVS is valued rather cheaply.
NVS is valuated correctly with a Price/Forward Earnings ratio of 12.34.
Based on the Price/Forward Earnings ratio, NVS is valued cheaper than 84.90% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.82, NVS is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.96 | ||
| Fwd PE | 12.34 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NVS is valued cheaply inside the industry as 86.46% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, NVS is valued cheaper than 83.85% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.36 | ||
| EV/EBITDA | 9.43 |
4.3 Compensation for Growth
NVS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NVS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.18
PEG (5Y)2.29
EPS Next 2Y9.87%
EPS Next 3Y8.83%
5. Dividend
5.1 Amount
NVS has a Yearly Dividend Yield of 3.56%. Purely for dividend investing, there may be better candidates out there.
NVS's Dividend Yield is rather good when compared to the industry average which is at 4.28. NVS pays more dividend than 94.27% of the companies in the same industry.
NVS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
5.2 History
The dividend of NVS has a limited annual growth rate of 2.97%.
NVS has been paying a dividend for at least 10 years, so it has a reliable track record.
NVS has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.97%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
NVS pays out 29.69% of its income as dividend. This is a sustainable payout ratio.
The dividend of NVS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP29.69%
EPS Next 2Y9.87%
EPS Next 3Y8.83%
NOVARTIS AG-SPONSORED ADR
NYSE:NVS (11/21/2024, 7:00:00 PM)
After market: 103 -0.85 (-0.82%)103.85
+0.76 (+0.74%)
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 Cap210.25B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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PT rev (1m)
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EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
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Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.96 | ||
| Fwd PE | 12.34 | ||
| 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)1.18
PEG (5Y)2.29
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.59% | ||
| ROE | 44.2% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 27.87% | ||
| PM (TTM) | 29.84% | ||
| GM | 74.29% | ||
| 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 Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.71 | ||
| 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)6.82%
EPS 3Y6.08%
EPS 5Y
EPS Q2Q%
EPS Next Y11.87%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)7.57%
Revenue growth 3Y-2.21%
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