NOVO-NORDISK A/S-SPONS ADR (NVO)
US6701002056 - ADR
Overall NVO gets a fundamental rating of 7 out of 10. We evaluated NVO against 198 industry peers in the Pharmaceuticals industry. NVO has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. NVO is not priced too expensively while it is growing strongly. Keep and eye on this one! Finally NVO also has an excellent dividend rating. These ratings could make NVO a good candidate for dividend and growth and quality investing.
1. Profitability
1.1 Basic Checks
NVO had positive earnings in the past year.
NVO had a positive operating cash flow in the past year.
In the past 5 years NVO has always been profitable.
Each year in the past 5 years NVO had a positive operating cash flow.
1.2 Ratios
NVO has a better Return On Assets (26.61%) than 98.46% of its industry peers.
NVO's Return On Equity of 78.53% is amongst the best of the industry. NVO outperforms 98.46% of its industry peers.
With an excellent Return On Invested Capital value of 56.78%, NVO belongs to the best of the industry, outperforming 99.49% of the companies in the same industry.
NVO had an Average Return On Invested Capital over the past 3 years of 50.71%. This is significantly above the industry average of 16.31%.
The last Return On Invested Capital (56.78%) for NVO is above the 3 year average (50.71%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 26.61% | ||
| ROE | 78.53% | ||
| ROIC | 56.78% |
ROA(3y)24.73%
ROA(5y)26.85%
ROE(3y)70.85%
ROE(5y)69.34%
ROIC(3y)50.71%
ROIC(5y)53.98%
1.3 Margins
The Profit Margin of NVO (36.03%) is better than 95.90% of its industry peers.
NVO's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 44.16%, NVO belongs to the top of the industry, outperforming 97.95% of the companies in the same industry.
NVO's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 84.60%, NVO belongs to the top of the industry, outperforming 87.18% of the companies in the same industry.
In the last couple of years the Gross Margin of NVO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.16% | ||
| PM (TTM) | 36.03% | ||
| GM | 84.6% |
OM growth 3Y1.58%
OM growth 5Y1.31%
PM growth 3Y2.77%
PM growth 5Y0.85%
GM growth 3Y0.43%
GM growth 5Y0.08%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so NVO is creating value.
NVO has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, NVO has more shares outstanding
The debt/assets ratio for NVO has been reduced compared to a year ago.
2.2 Solvency
NVO has an Altman-Z score of 13.17. This indicates that NVO is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 13.17, NVO belongs to the best of the industry, outperforming 89.23% of the companies in the same industry.
The Debt to FCF ratio of NVO is 0.39, which is an excellent value as it means it would take NVO, only 0.39 years of fcf income to pay off all of its debts.
NVO has a better Debt to FCF ratio (0.39) than 96.41% of its industry peers.
A Debt/Equity ratio of 0.19 indicates that NVO is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.19, NVO is in line with its industry, outperforming 44.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 0.39 | ||
| Altman-Z | 13.17 |
ROIC/WACC8.15
WACC6.97%
2.3 Liquidity
A Current Ratio of 0.82 indicates that NVO may have some problems paying its short term obligations.
NVO has a worse Current ratio (0.82) than 91.79% of its industry peers.
A Quick Ratio of 0.64 indicates that NVO may have some problems paying its short term obligations.
NVO has a Quick ratio of 0.64. This is amonst the worse of the industry: NVO underperforms 89.74% of its industry peers.
NVO 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 | 0.82 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
NVO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 52.33%, which is quite impressive.
The Earnings Per Share has been growing slightly by 3.16% on average over the past years.
Looking at the last year, NVO shows a very strong growth in Revenue. The Revenue has grown by 31.26%.
The Revenue has been growing by 15.74% on average over the past years. This is quite good.
EPS 1Y (TTM)52.33%
EPS 3Y1.11%
EPS 5Y3.16%
EPS growth Q2Q63.12%
Revenue 1Y (TTM)31.26%
Revenue growth 3Y22.31%
Revenue growth 5Y15.74%
Revenue growth Q2Q36.95%
3.2 Future
NVO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.88% yearly.
NVO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.50% yearly.
EPS Next Y26.98%
EPS Next 2Y24.4%
EPS Next 3Y22.9%
EPS Next 5Y15.88%
Revenue Next Year25.89%
Revenue Next 2Y23.3%
Revenue Next 3Y21.15%
Revenue Next 5Y15.5%
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 accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 46.32, the valuation of NVO can be described as expensive.
Based on the Price/Earnings ratio, NVO is valued cheaply inside the industry as 81.03% of the companies are valued more expensively.
NVO is valuated expensively when we compare the Price/Earnings ratio to 28.02, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 36.49, the valuation of NVO can be described as expensive.
Based on the Price/Forward Earnings ratio, NVO is valued a bit cheaper than the industry average as 78.97% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.58, NVO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.32 | ||
| Fwd PE | 36.49 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NVO is valued a bit cheaper than the industry average as 77.95% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, NVO is valued a bit cheaper than the industry average as 78.97% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 55.11 | ||
| EV/EBITDA | 33.86 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
NVO has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as NVO's earnings are expected to grow with 22.90% in the coming years.
PEG (NY)1.72
PEG (5Y)14.64
EPS Next 2Y24.4%
EPS Next 3Y22.9%
5. Dividend
5.1 Amount
NVO has a Yearly Dividend Yield of 1.11%.
Compared to an average industry Dividend Yield of 4.19, NVO pays a better dividend. On top of this NVO pays more dividend than 91.28% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, NVO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
5.2 History
The dividend of NVO is nicely growing with an annual growth rate of 11.24%!
NVO has been paying a dividend for at least 10 years, so it has a reliable track record.
As NVO did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)11.24%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
NVO pays out 37.96% of its income as dividend. This is a sustainable payout ratio.
NVO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.96%
EPS Next 2Y24.4%
EPS Next 3Y22.9%
NOVO-NORDISK A/S-SPONS ADR
NYSE:NVO (5/6/2024, 7:18:20 PM)
After market: 124.2 -0.39 (-0.31%)124.59
+1.54 (+1.25%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
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Market Cap555.80B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
Dividend Growth(5Y)
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Surprises & Revisions
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.32 | ||
| Fwd PE | 36.49 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
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EPS(NY)
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PEG (NY)1.72
PEG (5Y)14.64
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 26.61% | ||
| ROE | 78.53% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 44.16% | ||
| PM (TTM) | 36.03% | ||
| GM | 84.6% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
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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 Turnover0.74
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.82 | ||
| Quick Ratio | 0.64 | ||
| 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)
Growth
EPS 1Y (TTM)52.33%
EPS 3Y1.11%
EPS 5Y
EPS growth Q2Q
EPS Next Y26.98%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)31.26%
Revenue growth 3Y22.31%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
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EBIT growth 3Y
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