NOVO-NORDISK A/S-SPONS ADR (NVO) Stock Fundamental Analysis
NYSE:NVO - New York Stock Exchange, Inc. - US6701002056 - ADR - Currency: USD
NVO gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 193 industry peers in the Pharmaceuticals industry. While NVO has a great profitability rating, 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. Finally 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.
NVO had positive earnings in each of the past 5 years.
In the past 5 years NVO always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 21.39%, NVO belongs to the best of the industry, outperforming 99.48% of the companies in the same industry.
NVO has a Return On Equity of 75.51%. This is amongst the best in the industry. NVO outperforms 98.96% of its industry peers.
NVO has a better Return On Invested Capital (44.39%) than 99.48% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NVO is significantly above the industry average of 14.92%.
The last Return On Invested Capital (44.39%) 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 | 21.39% | ||
| ROE | 75.51% | ||
| ROIC | 44.39% |
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
NVO has a better Profit Margin (34.51%) than 97.41% of its industry peers.
NVO's Profit Margin has improved in the last couple of years.
NVO has a better Operating Margin (46.51%) than 97.93% of its industry peers.
In the last couple of years the Operating Margin of NVO has grown nicely.
NVO has a Gross Margin of 84.33%. This is amongst the best in the industry. NVO outperforms 89.64% of its industry peers.
NVO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.51% | ||
| PM (TTM) | 34.51% | ||
| GM | 84.33% |
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
NVO has more shares outstanding than it did 5 years ago.
The debt/assets ratio for NVO is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.21 indicates that NVO is not in any danger for bankruptcy at the moment.
The Altman-Z score of NVO (4.21) is better than 77.72% of its industry peers.
The Debt to FCF ratio of NVO is 1.60, which is an excellent value as it means it would take NVO, only 1.60 years of fcf income to pay off all of its debts.
NVO has a better Debt to FCF ratio (1.60) than 94.82% of its industry peers.
A Debt/Equity ratio of 0.70 indicates that NVO is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.70, NVO is not doing good in the industry: 67.36% of the companies in the same industry are doing better.
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 | 0.7 | ||
| Debt/FCF | 1.6 | ||
| Altman-Z | 4.21 |
ROIC/WACC7.94
WACC5.59%
2.3 Liquidity
A Current Ratio of 0.74 indicates that NVO may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.74, NVO is doing worse than 89.12% of the companies in the same industry.
A Quick Ratio of 0.56 indicates that NVO may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.56, NVO is doing worse than 89.64% of the companies in the same industry.
The current and quick ratio evaluation for NVO is rather negative, while it does have 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 | 0.74 | ||
| 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 17.96%, which is quite good.
The Earnings Per Share has been growing slightly by 6.68% on average over the past years.
The Revenue has grown by 24.11% in the past year. This is a very strong growth!
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)17.96%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%14.96%
Revenue 1Y (TTM)24.11%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%19.49%
3.2 Future
Based on estimates for the next years, NVO will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.29% on average per year.
NVO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.94% yearly.
EPS Next Y19.72%
EPS Next 2Y21.13%
EPS Next 3Y18.2%
EPS Next 5Y14.29%
Revenue Next Year14.69%
Revenue Next 2Y14.36%
Revenue Next 3Y13.46%
Revenue Next 5Y11.94%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.66, NVO is valued correctly.
NVO's Price/Earnings ratio is rather cheap when compared to the industry. NVO is cheaper than 86.01% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.82. NVO is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 9.66, the valuation of NVO can be described as reasonable.
Based on the Price/Forward Earnings ratio, NVO is valued cheaper than 83.42% of the companies in the same industry.
NVO is valuated cheaply when we compare the Price/Forward Earnings ratio to 36.21, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.66 | ||
| Fwd PE | 9.66 |
4.2 Price Multiples
NVO's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. NVO is cheaper than 87.56% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, NVO is valued cheaper than 84.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.18 | ||
| EV/EBITDA | 9.17 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
NVO has an outstanding profitability rating, which may justify a higher PE ratio.
NVO's earnings are expected to grow with 18.20% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.69
PEG (5Y)2.05
EPS Next 2Y21.13%
EPS Next 3Y18.2%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.62%, NVO has a reasonable but not impressive dividend return.
The stock price of NVO dropped by -30.39% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
NVO's Dividend Yield is rather good when compared to the industry average which is at 4.21. NVO pays more dividend than 93.78% of the companies in the same industry.
NVO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.62% |
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
48.61% of the earnings are spent on dividend by NVO. This is a bit on the high side, but may be sustainable.
NVO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP48.61%
EPS Next 2Y21.13%
EPS Next 3Y18.2%
NYSE:NVO (8/4/2025, 2:46:08 PM)
49.055
+0.87 (+1.79%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners36.28%
Inst Owner Change2.12%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap217.97B
Analysts74.38
Price Target98.9 (101.61%)
Short Float %0.56%
Short Ratio2.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.62% |
Yearly Dividend1.52
Dividend Growth(5Y)16.56%
DP48.61%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.7%
Min EPS beat(2)3.94%
Max EPS beat(2)7.46%
EPS beat(4)3
Avg EPS beat(4)1.85%
Min EPS beat(4)-4.65%
Max EPS beat(4)7.46%
EPS beat(8)6
Avg EPS beat(8)2.79%
EPS beat(12)9
Avg EPS beat(12)2.12%
EPS beat(16)13
Avg EPS beat(16)2.95%
Revenue beat(2)1
Avg Revenue beat(2)2.92%
Min Revenue beat(2)-1.11%
Max Revenue beat(2)6.95%
Revenue beat(4)1
Avg Revenue beat(4)0.36%
Min Revenue beat(4)-2.57%
Max Revenue beat(4)6.95%
Revenue beat(8)4
Avg Revenue beat(8)0.95%
Revenue beat(12)7
Avg Revenue beat(12)0.8%
Revenue beat(16)11
Avg Revenue beat(16)1.29%
PT rev (1m)-3.25%
PT rev (3m)-13.04%
EPS NQ rev (1m)1.1%
EPS NQ rev (3m)-6.45%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.24%
Revenue NQ rev (1m)-0.61%
Revenue NQ rev (3m)-5.15%
Revenue NY rev (1m)-3.94%
Revenue NY rev (3m)-5.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.66 | ||
| Fwd PE | 9.66 | ||
| P/S | 4.71 | ||
| P/FCF | 19.18 | ||
| P/OCF | 10.87 | ||
| P/B | 10.3 | ||
| P/tB | 48.92 | ||
| EV/EBITDA | 9.17 |
EPS(TTM)3.59
EY7.32%
EPS(NY)5.08
Fwd EY10.35%
FCF(TTM)2.56
FCFY5.21%
OCF(TTM)4.51
OCFY9.2%
SpS10.43
BVpS4.76
TBVpS1
PEG (NY)0.69
PEG (5Y)2.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.39% | ||
| ROE | 75.51% | ||
| ROCE | 55.72% | ||
| ROIC | 44.39% | ||
| ROICexc | 53.11% | ||
| ROICexgc | 110% | ||
| OM | 46.51% | ||
| PM (TTM) | 34.51% | ||
| GM | 84.33% | ||
| FCFM | 24.53% |
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%
ROICexcg growth 3Y-1.28%
ROICexcg 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-Score5
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 1.6 | ||
| Debt/EBITDA | 0.6 | ||
| Cap/Depr | 284.1% | ||
| Cap/Sales | 18.77% | ||
| Interest Coverage | 108.03 | ||
| Cash Conversion | 81.52% | ||
| Profit Quality | 71.08% | ||
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 4.21 |
F-Score5
WACC5.59%
ROIC/WACC7.94
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)17.96%
EPS 3Y2.95%
EPS 5Y6.68%
EPS Q2Q%14.96%
EPS Next Y19.72%
EPS Next 2Y21.13%
EPS Next 3Y18.2%
EPS Next 5Y14.29%
Revenue 1Y (TTM)24.11%
Revenue growth 3Y27.29%
Revenue growth 5Y18.94%
Sales Q2Q%19.49%
Revenue Next Year14.69%
Revenue Next 2Y14.36%
Revenue Next 3Y13.46%
Revenue Next 5Y11.94%
EBIT growth 1Y28.85%
EBIT growth 3Y32.76%
EBIT growth 5Y20.94%
EBIT Next Year32.99%
EBIT Next 3Y20.98%
EBIT Next 5Y13.43%
FCF growth 1Y10.42%
FCF growth 3Y13.52%
FCF growth 5Y14.4%
OCF growth 1Y54.2%
OCF growth 3Y30.05%
OCF growth 5Y20.93%