NOVARTIS AG-SPONSORED ADR (NVS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NVS - US66987V1098 - ADR
138.54 USD
+0.67 (+0.49%)
138.54 USD
0 (0%)
Overall NVS gets a fundamental rating of 7 out of 10. We evaluated NVS against 191 industry peers in the Pharmaceuticals industry. NVS gets an excellent profitability rating and is at the same time showing great financial health properties. NVS is valued quite cheap, while showing a decent growth score. This is a good combination! Finally NVS also has an excellent dividend rating. With these ratings, NVS could be worth investigating further for value and dividend and quality investing!.
1. Profitability
1.1 Basic Checks
NVS had positive earnings in the past year.
In the past year NVS had a positive cash flow from operations.
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
Looking at the Return On Assets, with a value of 13.42%, NVS belongs to the top of the industry, outperforming 94.24% of the companies in the same industry.
With an excellent Return On Equity value of 32.47%, NVS belongs to the best of the industry, outperforming 94.24% of the companies in the same industry.
NVS's Return On Invested Capital of 22.36% is amongst the best of the industry. NVS outperforms 97.38% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NVS is in line with the industry average of 12.85%.
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
NVS has a better Profit Margin (25.69%) than 92.15% of its industry peers.
NVS's Profit Margin has been stable in the last couple of years.
NVS has a better Operating Margin (33.11%) than 94.76% of its industry peers.
NVS's Operating Margin has improved in the last couple of years.
NVS's Gross Margin of 76.10% is amongst the best of 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
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
NVS has a worse debt/assets ratio than last year.
2.2 Solvency
NVS has an Altman-Z score of 4.14. This indicates that NVS is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.14, NVS is doing good in the industry, outperforming 72.25% of the companies in the same industry.
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 94.24% 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.
With a Debt to Equity ratio value of 0.55, NVS is not doing good in the industry: 65.44% of the companies in the same industry are doing better.
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 | 4.14 |
ROIC/WACC4.72
WACC4.74%
2.3 Liquidity
NVS has a Current 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.
NVS has a worse Current ratio (0.88) than 86.91% of its industry peers.
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.
NVS's Quick ratio of 0.68 is on the low side compared to the rest of the industry. NVS is outperformed by 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
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.
NVS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.24% yearly.
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 9.35% on average per year.
Based on estimates for the next years, NVS will show a small growth in Revenue. The Revenue will grow by 5.35% on average per year.
EPS Next Y16.78%
EPS Next 2Y9.31%
EPS Next 3Y8.66%
EPS Next 5Y9.35%
Revenue Next Year9.91%
Revenue Next 2Y6.24%
Revenue Next 3Y5.54%
Revenue Next 5Y5.35%
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.
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
Based on the Price/Earnings ratio of 15.34, the valuation of NVS can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of NVS indicates a rather cheap valuation: NVS is cheaper than 85.34% 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 26.60.
Based on the Price/Forward Earnings ratio of 14.68, the valuation of NVS can be described as correct.
Based on the Price/Forward Earnings ratio, NVS is valued cheaply inside the industry as 82.20% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 23.23. NVS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.34 | ||
| Fwd PE | 14.68 |
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.
Based on the Price/Free Cash Flow ratio, NVS is valued cheaply inside the industry as 86.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.58 | ||
| EV/EBITDA | 11.97 |
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)0.91
PEG (5Y)1.88
EPS Next 2Y9.31%
EPS Next 3Y8.66%
5. Dividend
5.1 Amount
NVS has a Yearly Dividend Yield of 3.18%.
Compared to an average industry Dividend Yield of 0.61, NVS pays a better dividend. On top of this NVS pays more dividend than 95.81% 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 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.18% |
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
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 2Y9.31%
EPS Next 3Y8.66%
138.54
+0.67 (+0.49%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners41.28%
Inst Owner Change0.44%
Ins Owners0.01%
Ins Owner ChangeN/A
Market Cap265.83B
Revenue(TTM)56.02B
Net Income(TTM)14.39B
Analysts70.32
Price Target135.04 (-2.53%)
Short Float %0.31%
Short Ratio3.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.18% |
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)-0.14%
EPS NQ rev (1m)-0.49%
EPS NQ rev (3m)0.44%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)0.37%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)0.73%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)0.38%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.34 | ||
| Fwd PE | 14.68 | ||
| P/S | 4.74 | ||
| P/FCF | 15.58 | ||
| P/OCF | 12.61 | ||
| P/B | 6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.97 |
EPS(TTM)9.03
EY6.52%
EPS(NY)9.44
Fwd EY6.81%
FCF(TTM)8.89
FCFY6.42%
OCF(TTM)10.98
OCFY7.93%
SpS29.2
BVpS23.1
TBVpS-5.35
PEG (NY)0.91
PEG (5Y)1.88
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 | 4.14 |
F-Score7
WACC4.74%
ROIC/WACC4.72
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 5Y9.35%
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 5Y5.35%
EBIT growth 1Y21.58%
EBIT growth 3Y14.18%
EBIT growth 5Y7.57%
EBIT Next Year36.14%
EBIT Next 3Y13.19%
EBIT Next 5Y13.76%
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 7 / 10 and the dividend payout ratio is 54.32%.