NOVO-NORDISK A/S-SPONS ADR (NYSE:NVO) – A Strong Growth Stock at a Reasonable Valuation

NOVO-NORDISK A/S-SPONS ADR (NYSE:NVO) was selected by our Affordable Growth stock screener, which identifies companies with solid growth prospects, reasonable valuations, and sound financial health. NVO stands out with strong profitability and growth metrics while trading at a valuation that appears attractive relative to its industry peers.

Growth Prospects

• Revenue Growth: NVO reported a 24.11% year-over-year revenue increase, with a five-year average growth rate of 18.94%.
• Earnings Growth: EPS grew by 17.96% in the past year, and analysts expect future annual growth of 14.29%.
• Accelerating Growth: The company’s EPS growth is expected to improve compared to its historical performance.

Valuation

• Attractive Multiples: NVO trades at a P/E ratio of 18.32, below the industry average of 23.60 and the S&P 500’s 27.18.
• Forward P/E of 12.95: Suggests the stock is reasonably priced relative to future earnings expectations.
• Undervalued vs. Peers: 83.94% of pharmaceutical industry stocks have higher P/E ratios than NVO.

Profitability & Financial Health

• High Profit Margins: NVO’s operating margin of 46.51% and net margin of 34.51% rank in the top 3% of its industry.
• Strong ROIC: The company generates a 44.39% return on invested capital, well above its cost of capital.
• Debt Concerns Mitigated: While the debt-to-equity ratio (0.70) is higher than some peers, NVO’s strong cash flow and profitability reduce liquidity risks.

For a deeper look at NVO’s fundamentals, review the full fundamental analysis report.

Our Affordable Growth screener lists more stocks with similar characteristics and is updated daily.

Disclaimer

This is not investment advice. The observations here are based on current data, but investors should conduct their own research before making decisions.