NOVO-NORDISK A/S-SPONS ADR (NVO) Stock Fundamental Analysis
USA - NYSE:NVO - US6701002056 - ADR
49.46 USD
-0.58 (-1.16%)
49.6497 USD
+0.19 (+0.38%)
We assign a fundamental rating of 7 out of 10 to NVO. NVO was compared to 192 industry peers in the Pharmaceuticals industry. While NVO belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. An interesting combination arises when we look at growth and value: NVO is growing strongly while it also seems undervalued. NVO also has an excellent dividend rating. This makes NVO very considerable for value and dividend and growth investing!
1. Profitability
1.1 Basic Checks
NVO had positive earnings in the past year.
In the past year NVO had a positive cash flow from operations.
Each year in the past 5 years NVO has been profitable.
In the past 5 years NVO always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of NVO (23.04%) is better than 97.92% of its industry peers.
NVO's Return On Equity of 66.09% is amongst the best of the industry. NVO outperforms 98.44% of its industry peers.
NVO's Return On Invested Capital of 41.43% is amongst the best of the industry. NVO outperforms 98.96% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NVO is significantly above the industry average of 15.41%.
The last Return On Invested Capital (41.43%) for NVO is well below the 3 year average (50.29%), which needs to be investigated, but indicates that NVO had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.04% | ||
| ROE | 66.09% | ||
| ROIC | 41.43% |
ROA(3y)23.77%
ROA(5y)24.99%
ROE(3y)71.81%
ROE(5y)69.89%
ROIC(3y)50.29%
ROIC(5y)49.64%
1.3 Margins
The Profit Margin of NVO (35.61%) is better than 97.40% of its industry peers.
In the last couple of years the Profit Margin of NVO has grown nicely.
With an excellent Operating Margin value of 45.78%, NVO belongs to the best of the industry, outperforming 98.44% of the companies in the same industry.
In the last couple of years the Operating Margin of NVO has grown nicely.
NVO's Gross Margin of 83.95% is amongst the best of the industry. NVO outperforms 88.02% of its industry peers.
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 | 45.78% | ||
| PM (TTM) | 35.61% | ||
| GM | 83.95% |
OM growth 3Y4.3%
OM growth 5Y1.69%
PM growth 3Y0.84%
PM growth 5Y1.73%
GM growth 3Y0.72%
GM growth 5Y0.24%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), NVO is creating value.
Compared to 1 year ago, NVO has less shares outstanding
Compared to 5 years ago, NVO has more shares outstanding
NVO has a worse debt/assets ratio than last year.
2.2 Solvency
NVO has an Altman-Z score of 4.71. This indicates that NVO is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.71, NVO is in the better half of the industry, outperforming 75.52% of the companies in the same industry.
The Debt to FCF ratio of NVO is 1.61, which is an excellent value as it means it would take NVO, only 1.61 years of fcf income to pay off all of its debts.
NVO has a Debt to FCF ratio of 1.61. This is amongst the best in the industry. NVO outperforms 94.27% of its industry peers.
A Debt/Equity ratio of 0.52 indicates that NVO is somewhat dependend on debt financing.
The Debt to Equity ratio of NVO (0.52) is worse than 61.98% of its industry peers.
Even though the debt/equity ratio score it not favorable for NVO, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | 1.61 | ||
| Altman-Z | 4.71 |
ROIC/WACC6.84
WACC6.06%
2.3 Liquidity
A Current Ratio of 0.78 indicates that NVO may have some problems paying its short term obligations.
The Current ratio of NVO (0.78) is worse than 89.06% of its industry peers.
NVO has a Quick Ratio of 0.78. This is a bad value and indicates that NVO is not financially healthy enough and could expect problems in meeting its short term obligations.
NVO's Quick ratio of 0.56 is on the low side compared to the rest of the industry. NVO is outperformed by 89.06% 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 | 0.78 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
NVO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 24.25%, which is quite impressive.
NVO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.68% yearly.
Looking at the last year, NVO shows a very strong growth in Revenue. The Revenue has grown by 20.90%.
Measured over the past years, NVO shows a quite strong growth in Revenue. The Revenue has been growing by 18.94% on average per year.
EPS 1Y (TTM)24.25%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%32.74%
Revenue 1Y (TTM)20.9%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%12.93%
3.2 Future
The Earnings Per Share is expected to grow by 9.00% on average over the next years. This is quite good.
Based on estimates for the next years, NVO will show a quite strong growth in Revenue. The Revenue will grow by 8.45% on average per year.
EPS Next Y9.19%
EPS Next 2Y8.94%
EPS Next 3Y9.11%
EPS Next 5Y9%
Revenue Next Year10.32%
Revenue Next 2Y8.85%
Revenue Next 3Y8.6%
Revenue Next 5Y8.45%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.81, which indicates a correct valuation of NVO.
Based on the Price/Earnings ratio, NVO is valued cheaper than 89.06% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.10. NVO is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 11.89, the valuation of NVO can be described as very reasonable.
83.85% of the companies in the same industry are more expensive than NVO, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of NVO to the average of the S&P500 Index (22.52), we can say NVO is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.81 | ||
| Fwd PE | 11.89 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NVO is valued cheaper than 88.54% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, NVO is valued cheaply inside the industry as 83.33% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.06 | ||
| EV/EBITDA | 9.45 |
4.3 Compensation for Growth
NVO's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of NVO may justify a higher PE ratio.
PEG (NY)1.39
PEG (5Y)1.92
EPS Next 2Y8.94%
EPS Next 3Y9.11%
5. Dividend
5.1 Amount
NVO has a Yearly Dividend Yield of 3.61%. Purely for dividend investing, there may be better candidates out there.
NVO's Dividend Yield is rather good when compared to the industry average which is at 6.52. NVO pays more dividend than 95.31% of the companies in the same industry.
NVO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.61% |
5.2 History
The dividend of NVO is nicely growing with an annual growth rate of 16.56%!
NVO has paid a dividend for at least 10 years, which is 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)16.56%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
NVO pays out 45.63% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of NVO is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP45.63%
EPS Next 2Y8.94%
EPS Next 3Y9.11%
49.46
-0.58 (-1.16%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners36.01%
Inst Owner Change-2.94%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap219.77B
Revenue(TTM)311.94B
Net Income(TTM)111.07B
Analysts73.33
Price Target71.47 (44.5%)
Short Float %0.64%
Short Ratio1.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.61% |
Yearly Dividend1.54
Dividend Growth(5Y)16.56%
DP45.63%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.4%
Min EPS beat(2)-1.15%
Max EPS beat(2)3.94%
EPS beat(4)3
Avg EPS beat(4)2.73%
Min EPS beat(4)-1.15%
Max EPS beat(4)7.46%
EPS beat(8)6
Avg EPS beat(8)3.48%
EPS beat(12)9
Avg EPS beat(12)2.29%
EPS beat(16)12
Avg EPS beat(16)2.31%
Revenue beat(2)0
Avg Revenue beat(2)-0.85%
Min Revenue beat(2)-1.11%
Max Revenue beat(2)-0.6%
Revenue beat(4)1
Avg Revenue beat(4)0.67%
Min Revenue beat(4)-2.57%
Max Revenue beat(4)6.95%
Revenue beat(8)4
Avg Revenue beat(8)1.2%
Revenue beat(12)7
Avg Revenue beat(12)0.86%
Revenue beat(16)10
Avg Revenue beat(16)1.1%
PT rev (1m)-9.84%
PT rev (3m)-27.73%
EPS NQ rev (1m)-14.53%
EPS NQ rev (3m)-21.62%
EPS NY rev (1m)0%
EPS NY rev (3m)-8.79%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)-4.38%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-3.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.81 | ||
| Fwd PE | 11.89 | ||
| P/S | 4.55 | ||
| P/FCF | 23.06 | ||
| P/OCF | 11.69 | ||
| P/B | 8.45 | ||
| P/tB | 23.6 | ||
| EV/EBITDA | 9.45 |
EPS(TTM)3.86
EY7.8%
EPS(NY)4.16
Fwd EY8.41%
FCF(TTM)2.15
FCFY4.34%
OCF(TTM)4.23
OCFY8.56%
SpS10.86
BVpS5.85
TBVpS2.1
PEG (NY)1.39
PEG (5Y)1.92
Graham Number22.54
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.04% | ||
| ROE | 66.09% | ||
| ROCE | 52% | ||
| ROIC | 41.43% | ||
| ROICexc | 44.49% | ||
| ROICexgc | 76.96% | ||
| OM | 45.78% | ||
| PM (TTM) | 35.61% | ||
| GM | 83.95% | ||
| FCFM | 19.75% |
ROA(3y)23.77%
ROA(5y)24.99%
ROE(3y)71.81%
ROE(5y)69.89%
ROIC(3y)50.29%
ROIC(5y)49.64%
ROICexc(3y)60.7%
ROICexc(5y)59.32%
ROICexgc(3y)124.92%
ROICexgc(5y)112.44%
ROCE(3y)63.71%
ROCE(5y)65.35%
ROICexgc growth 3Y-1.28%
ROICexgc growth 5Y0.46%
ROICexc growth 3Y-2.16%
ROICexc growth 5Y-9.95%
OM growth 3Y4.3%
OM growth 5Y1.69%
PM growth 3Y0.84%
PM growth 5Y1.73%
GM growth 3Y0.72%
GM growth 5Y0.24%
F-Score4
Asset Turnover0.65
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.52 | ||
| Debt/FCF | 1.61 | ||
| Debt/EBITDA | 0.55 | ||
| Cap/Depr | 374.26% | ||
| Cap/Sales | 19.21% | ||
| Interest Coverage | 60.84 | ||
| Cash Conversion | 76.52% | ||
| Profit Quality | 55.47% | ||
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 4.71 |
F-Score4
WACC6.06%
ROIC/WACC6.84
Cap/Depr(3y)294.05%
Cap/Depr(5y)277.71%
Cap/Sales(3y)14.25%
Cap/Sales(5y)13.08%
Profit Quality(3y)89.38%
Profit Quality(5y)87.75%
High Growth Momentum
Growth
EPS 1Y (TTM)24.25%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%32.74%
EPS Next Y9.19%
EPS Next 2Y8.94%
EPS Next 3Y9.11%
EPS Next 5Y9%
Revenue 1Y (TTM)20.9%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%12.93%
Revenue Next Year10.32%
Revenue Next 2Y8.85%
Revenue Next 3Y8.6%
Revenue Next 5Y8.45%
EBIT growth 1Y21.88%
EBIT growth 3Y32.76%
EBIT growth 5Y20.94%
EBIT Next Year21.98%
EBIT Next 3Y13.55%
EBIT Next 5Y10.24%
FCF growth 1Y-8.73%
FCF growth 3Y13.52%
FCF growth 5Y14.4%
OCF growth 1Y35.43%
OCF growth 3Y30.05%
OCF growth 5Y20.93%
NOVO-NORDISK A/S-SPONS ADR / NVO FAQ
Can you provide the ChartMill fundamental rating for NOVO-NORDISK A/S-SPONS ADR?
ChartMill assigns a fundamental rating of 7 / 10 to NVO.
Can you provide the valuation status for NOVO-NORDISK A/S-SPONS ADR?
ChartMill assigns a valuation rating of 8 / 10 to NOVO-NORDISK A/S-SPONS ADR (NVO). This can be considered as Undervalued.
Can you provide the profitability details for NOVO-NORDISK A/S-SPONS ADR?
NOVO-NORDISK A/S-SPONS ADR (NVO) has a profitability rating of 9 / 10.
What is the financial health of NOVO-NORDISK A/S-SPONS ADR (NVO) stock?
The financial health rating of NOVO-NORDISK A/S-SPONS ADR (NVO) is 6 / 10.
Can you provide the dividend sustainability for NVO stock?
The dividend rating of NOVO-NORDISK A/S-SPONS ADR (NVO) is 6 / 10 and the dividend payout ratio is 45.63%.