NOVARTIS AG-SPONSORED ADR (NVS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NVS - US66987V1098 - ADR
135.03 USD
0 (0%)
135.03 USD
0 (0%)
NVS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 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 is valued quite cheap, while showing a decent growth score. This is a good combination! Finally NVS also has an excellent dividend rating. This makes NVS very considerable for value and dividend and quality investing!
1. Profitability
1.1 Basic Checks
In the past year NVS was profitable.
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
NVS's Return On Assets of 13.42% is amongst the best of the industry. NVS outperforms 94.24% of its industry peers.
The Return On Equity of NVS (32.47%) is better 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 12.85%.
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
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.
NVS's Operating Margin of 33.11% is amongst the best of the industry. NVS outperforms 94.76% of its industry peers.
In the last couple of years the Operating Margin of NVS has grown nicely.
NVS's Gross Margin of 76.10% is amongst the best of the industry. NVS outperforms 82.20% of its industry peers.
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 | 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.
NVS has less shares outstanding than it did 1 year ago.
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 4.09. This indicates that NVS is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.09, NVS is doing good in the industry, outperforming 72.77% 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.
The Debt to FCF ratio of NVS (1.87) is better than 94.24% of its industry peers.
A Debt/Equity ratio of 0.55 indicates that 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: 64.92% 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 | 4.09 |
ROIC/WACC4.45
WACC5.02%
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.
With a Current ratio value of 0.88, NVS is not doing good in the industry: 87.96% 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.
NVS has a worse Quick ratio (0.68) than 87.43% 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.
The Earnings Per Share has been growing by 8.14% on average over the past years. This is quite good.
NVS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.18%.
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 9.35% yearly.
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 Y16.69%
EPS Next 2Y9.51%
EPS Next 3Y8.79%
EPS Next 5Y9.35%
Revenue Next Year9.86%
Revenue Next 2Y6.25%
Revenue Next 3Y5.47%
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
With a Price/Earnings ratio of 14.95, NVS is valued correctly.
86.39% of the companies in the same industry are more expensive than NVS, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.22. NVS is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 14.26, NVS is valued correctly.
NVS's Price/Forward Earnings ratio is rather cheap when compared to the industry. NVS is cheaper than 81.15% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of NVS to the average of the S&P500 Index (23.58), we can say NVS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 14.26 |
4.2 Price Multiples
84.29% of the companies in the same industry are more expensive than NVS, based on the Enterprise Value to EBITDA ratio.
NVS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. NVS is cheaper than 86.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.19 | ||
| EV/EBITDA | 11.74 |
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)0.9
PEG (5Y)1.84
EPS Next 2Y9.51%
EPS Next 3Y8.79%
5. Dividend
5.1 Amount
NVS has a Yearly Dividend Yield of 3.30%. 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 0.52. NVS pays more dividend than 94.24% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 1.87, NVS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.3% |
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 2Y9.51%
EPS Next 3Y8.79%
135.03
0 (0%)
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 Cap259.09B
Revenue(TTM)56.02B
Net Income(TTM)14.39B
Analysts70.32
Price Target135.04 (0.01%)
Short Float %0.29%
Short Ratio2.85
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.3% |
Yearly Dividend3.79
Dividend Growth(5Y)5.49%
DP54.32%
Div Incr Years5
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.71%
Min EPS beat(2)-2.03%
Max EPS beat(2)0.61%
EPS beat(4)3
Avg EPS beat(4)2.81%
Min EPS beat(4)-2.03%
Max EPS beat(4)6.59%
EPS beat(8)6
Avg EPS beat(8)2.03%
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)1.58%
PT rev (3m)-0.14%
EPS NQ rev (1m)-0.23%
EPS NQ rev (3m)1.04%
EPS NY rev (1m)-0.22%
EPS NY rev (3m)0.2%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)0.76%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)0.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 14.26 | ||
| P/S | 4.62 | ||
| P/FCF | 15.19 | ||
| P/OCF | 12.3 | ||
| P/B | 5.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.74 |
EPS(TTM)9.03
EY6.69%
EPS(NY)9.47
Fwd EY7.01%
FCF(TTM)8.89
FCFY6.58%
OCF(TTM)10.98
OCFY8.13%
SpS29.2
BVpS23.1
TBVpS-5.35
PEG (NY)0.9
PEG (5Y)1.84
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 | 4.09 |
F-Score7
WACC5.02%
ROIC/WACC4.45
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 Y16.69%
EPS Next 2Y9.51%
EPS Next 3Y8.79%
EPS Next 5Y9.35%
Revenue 1Y (TTM)12.18%
Revenue growth 3Y5.56%
Revenue growth 5Y1.24%
Sales Q2Q%8.47%
Revenue Next Year9.86%
Revenue Next 2Y6.25%
Revenue Next 3Y5.47%
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.
Can you provide the valuation status for NOVARTIS AG-SPONSORED ADR?
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.
What are the PE and PB ratios of NOVARTIS AG-SPONSORED ADR (NVS) stock?
The Price/Earnings (PE) ratio for NOVARTIS AG-SPONSORED ADR (NVS) is 14.95 and the Price/Book (PB) ratio is 5.84.
What is the earnings growth outlook for NOVARTIS AG-SPONSORED ADR?
The Earnings per Share (EPS) of NOVARTIS AG-SPONSORED ADR (NVS) is expected to grow by 16.69% in the next year.