Market Cap
CHF176.2b
Last Updated
2020/03/30 21:13 UTC
Data Sources
Company Financials +
Executive Summary
Novartis AG researches, develops, manufactures, and markets healthcare products worldwide.
Rewards
Risk Analysis
Snowflake Analysis
Reasonable growth potential average dividend payer.
Similar Companies
Share Price & News
How has Novartis's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: NOVN has not had significant price volatility in the past 3 months.
Market Performance
7 Day Return
11.1%
NOVN
10.9%
CH Pharmaceuticals
10.7%
CH Market
1 Year Return
-19.0%
NOVN
-3.0%
CH Pharmaceuticals
-5.9%
CH Market
Return vs Industry: NOVN underperformed the Swiss Pharmaceuticals industry which returned -5.8% over the past year.
Return vs Market: NOVN underperformed the Swiss Market which returned -6.9% over the past year.
Shareholder returns
| NOVN | Industry | Market | |
|---|---|---|---|
| 7 Day | 11.1% | 10.9% | 10.7% |
| 30 Day | -4.2% | -2.4% | -7.3% |
| 90 Day | -15.3% | -8.2% | -13.9% |
| 1 Year | -4.9%-19.0% | 6.1%-3.0% | -1.1%-5.9% |
| 3 Year | 31.4%4.6% | 31.5%13.2% | 14.2%2.6% |
| 5 Year | 9.4%-19.0% | 24.0%-1.0% | 18.4%-1.1% |
Price Volatility Vs. Market
How volatile is Novartis's share price compared to the market and industry in the last 5 years?
Simply Wall St News
2 weeks ago | Simply Wall St
Should You Be Tempted To Sell Novartis AG (VTX:NOVN) Because Of Its P/E Ratio?1 month ago | Simply Wall St
It Might Not Be A Great Idea To Buy Novartis AG (VTX:NOVN) For Its Next Dividend1 month ago | Simply Wall St
Does Novartis (VTX:NOVN) Have A Healthy Balance Sheet?Valuation
Is Novartis undervalued compared to its fair value and its price relative to the market?
43.6%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: NOVN (CHF77.8) is trading below our estimate of fair value (CHF137.9)
Significantly Below Fair Value: NOVN is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: NOVN is poor value based on its PE Ratio (26x) compared to the Pharmaceuticals industry average (19.3x).
PE vs Market: NOVN is poor value based on its PE Ratio (26x) compared to the Swiss market (16.8x).
Price to Earnings Growth Ratio
PEG Ratio: NOVN is poor value based on its PEG Ratio (2.4x)
Price to Book Ratio
PB vs Industry: NOVN is overvalued based on its PB Ratio (3.3x) compared to the CH Pharmaceuticals industry average (2.9x).
Next Steps
Future Growth
How is Novartis forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?
11.0%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: NOVN's forecast earnings growth (11% per year) is above the savings rate (-0.6%).
Earnings vs Market: NOVN's earnings (11% per year) are forecast to grow faster than the Swiss market (8.6% per year).
High Growth Earnings: NOVN's earnings are forecast to grow, but not significantly.
Revenue vs Market: NOVN's revenue (3.9% per year) is forecast to grow faster than the Swiss market (2.4% per year).
High Growth Revenue: NOVN's revenue (3.9% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: NOVN's Return on Equity is forecast to be high in 3 years time (23.2%)
Next Steps
Past Performance
How has Novartis performed over the past 5 years?
2.5%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: NOVN has a large one-off loss of $2.3B impacting its December 31 2019 financial results.
Growing Profit Margin: NOVN's current net profit margins (14.7%) are lower than last year (27.8%).
Past Earnings Growth Analysis
Earnings Trend: NOVN's earnings have grown by 2.5% per year over the past 5 years.
Accelerating Growth: NOVN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: NOVN had negative earnings growth (-44.2%) over the past year, making it difficult to compare to the Pharmaceuticals industry average (1.9%).
Return on Equity
High ROE: NOVN's Return on Equity (12.9%) is considered low.
Next Steps
Financial Health
How is Novartis's financial position?
Financial Position Analysis
Short Term Liabilities: NOVN's short term assets ($29.5B) exceed its short term liabilities ($28.3B).
Long Term Liabilities: NOVN's short term assets ($29.5B) do not cover its long term liabilities ($34.6B).
Debt to Equity History and Analysis
Debt Level: NOVN's debt to equity ratio (49.3%) is considered high.
Reducing Debt: NOVN's debt to equity ratio has increased from 28.9% to 49.3% over the past 5 years.
Debt Coverage: NOVN's debt is well covered by operating cash flow (49.8%).
Interest Coverage: NOVN's interest payments on its debt are well covered by EBIT (18.8x coverage).
Balance Sheet
Inventory Level: NOVN has a low level of unsold assets or inventory.
Debt Coverage by Assets: NOVN's debt is covered by short term assets (assets are 1.1x debt).
Next Steps
Dividend
What is Novartis's current dividend yield, its reliability and sustainability?
3.69%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: NOVN's dividend (3.69%) is higher than the bottom 25% of dividend payers in the Swiss market (2.16%).
High Dividend: NOVN's dividend (3.69%) is low compared to the top 25% of dividend payers in the Swiss market (4.34%).
Stability and Growth of Payments
Stable Dividend: NOVN's dividends per share have been stable in the past 10 years.
Growing Dividend: NOVN's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its high payout ratio (97.5%), NOVN's dividend payments are not well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: NOVN's dividends in 3 years are forecast to be well covered by earnings (48.7% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
1.9yrs
Average management tenure
CEO
Vas Narasimhan (43yo)
2s
Tenure
US$11,437,501
Compensation
Dr. Vasant Narasimhan, also known as Vas, M.D., serves as Chief Executive Officer of Novartis AG at Novartis India Ltd. Dr. Narasimhan has been Chief Executive Officer of Novartis AG since February 1, 2018 ...
CEO Compensation Analysis
Compensation vs Market: Vas's total compensation ($USD11.92M) is above average for companies of similar size in the Swiss market ($USD6.20M).
Compensation vs Earnings: Vas's compensation has been consistent with company performance over the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| Chief Executive Officer | 2yrs | US$11.44m | 0.012% $21.0m | |
| Chief Financial Officer | 6.83yrs | US$6.08m | 0.011% $19.6m | |
| Global Head of Technical Operations | 2.92yrs | US$3.14m | 0.0047% $8.4m | |
| Group General Counsel | 1.75yrs | US$3.62m | 0.0031% $5.5m | |
| Chief Ethics | 1.25yrs | US$2.12m | 0.00066% $1.2m | |
| Chief People & Organization Officer | 6yrs | US$4.01m | 0.0060% $10.6m | |
| Chief Digital Officer | 2.17yrs | US$2.57m | 0.0014% $2.4m | |
| Head of Global Drug Development & Chief Medical Officer | 1.83yrs | US$4.69m | 0.0024% $4.2m | |
| Head of Novartis Business Services | 1.75yrs | US$2.38m | 0.00085% $1.5m | |
| President of Novartis Oncology | 1.17yrs | US$4.58m | 0.0048% $8.4m |
1.9yrs
Average Tenure
50.5yo
Average Age
Experienced Management: NOVN's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| Honorary Chairman | no data | no data | no data | |
| Honorary Chairman | no data | US$2.98m | no data | |
| Independent Non Executive Director | 12yrs | US$400.00k | 0.00062% $1.1m | |
| Independent Non Executive Director | 14yrs | US$464.37k | 0.0071% $12.5m | |
| Independent Non Executive Chairman | 6.58yrs | US$3.80m | 0.025% $43.9m | |
| Independent Non Executive Director | 17.17yrs | US$460.00k | 0.0018% $3.2m | |
| Independent Non Executive Director | 7.17yrs | US$353.33k | 0.00080% $1.4m | |
| Independent Non Executive Director | 7.17yrs | US$360.00k | 0.00049% $863.5k | |
| Independent Non Executive Vice Chairman | 7yrs | US$533.51k | 0.0012% $2.1m | |
| Independent Non-Executive Director | 4yrs | US$450.00k | 0.00030% $528.7k |
7.2yrs
Average Tenure
64yo
Average Age
Experienced Board: NOVN's board of directors are considered experienced (7.2 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Novartis AG's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Novartis AG
- Ticker: NOVN
- Exchange: SWX
- Founded: 1895
- Industry: Pharmaceuticals
- Sector: Pharmaceuticals & Biotech
- Market Cap: CHF176.218b
- Shares outstanding: 2.27b
- Website: https://www.novartis.com
Number of Employees
Location
- Novartis AG
- Lichtstrasse 35
- Basel
- Basel-Stadt
- 4056
- Switzerland
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| NVS | NYSE (New York Stock Exchange) | ADR-EACH REPR 1 CHF0.5(REGD) | US | USD | Nov 1991 | |
| NVS N | BMV (Bolsa Mexicana de Valores) | ADR-EACH REPR 1 CHF0.5(REGD) | MX | MXN | Nov 1991 | |
| NOTA | DB (Deutsche Boerse AG) | ADR-EACH REPR 1 CHF0.5(REGD) | DE | EUR | Nov 1991 | |
| 0K9E | LSE (London Stock Exchange) | ADR-EACH REPR 1 CHF0.5(REGD) | GB | USD | Nov 1991 | |
| NVSE.F | OTCPK (Pink Sheets LLC) | Yes | Common Stock | US | USD | Dec 1996 |
| NOVN | SWX (SIX Swiss Exchange) | Yes | Common Stock | CH | CHF | Dec 1996 |
| NOT | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Dec 1996 |
| 0QLR | LSE (London Stock Exchange) | Yes | Common Stock | GB | CHF | Dec 1996 |
| NOT | XTRA (XETRA Trading Platform) | Yes | Common Stock | DE | EUR | Dec 1996 |
| NOVNEE | SWX (SIX Swiss Exchange) | CHF0.50 (2ND BUYBACK LINE) | CH | CHF | Mar 2008 | |
| 0QM7 | LSE (London Stock Exchange) | CHF0.50 (2ND BUYBACK LINE) | GB | CHF | Mar 2008 |
Biography
Novartis AG researches, develops, manufactures, and markets healthcare products worldwide. Its Innovative Medicines segment offers prescription medicines for patients and healthcare providers. It also provides ophthalmology, neuroscience, immunology, hepatology and dermatology, respiratory, cardio-metabolic, established, and cardiovascular, renal and metabolism medicine products. The company’s Sandoz segment provides active ingredients and finished dosage forms of small molecule pharmaceuticals to third parties across a range of therapeutic areas, as well as finished dosage form anti-infectives. It also provides active pharmaceutical ingredients and intermediates primarily antibiotics; protein- or other biotechnology-based products, including biosimilars; and biotechnology manufacturing services. Novartis AG has collaboration agreements with Pear Therapeutics; Wyss Institute for Biologically Inspired Engineering at Harvard University and the Dana-Farber Cancer Institute; Science 37; Bill & Melinda Gates Foundation; Amgen; University of California, Berkeley; Bristol-Myers Squibb; and Drugs for Neglected Diseases initiative (DNDi). The company was founded in 1895 and is headquartered in Basel, Switzerland.
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/03/30 21:13 |
| End of Day Share Price | 2020/03/30 00:00 |
| Earnings | 2019/12/31 |
| Annual Earnings | 2019/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.