Novartis AG (ADR) ($NVS) Cautious Buy or Hold to $76 Confident Investor Rating: Fair

Company name Novartis AG (ADR)
Stock ticker NVS
Live stock price [stckqut]NVS[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Poor
P/E growth Good
EBIT growth Poor

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $75.94
Target stock price (averages with growth) $81.37
Target stock price (averages with no growth) $69.2
Target stock price (manual assumptions) $80.87

The following company description is from Google Finance: http://www.google.com/finance?q=nvs

Novartis AG provides healthcare solutions. The Company is a multinational group of companies specializing in the research, development, manufacturing and marketing of a range of healthcare products led by pharmaceuticals. Its portfolio includes medicines, eye care, cost-saving generic pharmaceuticals, preventive vaccines and diagnostic tools, over-the-counter and animal health products. It has five segments: Pharmaceuticals, which include patent-protected prescription medicines; Alcon, which include surgical, ophthalmic pharmaceutical and vision care products; Sandoz, which include generic pharmaceuticals; vaccines and diagnostics, which include human vaccines and blood-testing diagnostics, and consumer health, which include over-the-counter medicines (OTC) and Animal Health. In February 2014, it acquired CoStim Pharmaceuticals, Inc.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in Novartis AG (ADR) as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor. You can review the best companies that I have found (and I probably invest my own money in most of these companies) in my Watch List.

How was this analysis of Novartis AG (ADR) calculated?

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
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In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

  • Stock price at the time of the calculation: $93.48
  • Growth: 0.07
  • Current EPS (TTM): $3.79
  • P/E: 24.5
  • Future EPS Calc: $5.31
  • Future Stock Price Calc: $130.23
  • Target stock price: $80.86

I hope that this makes you a better investor. [/s2If]

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