A look at Novartis
Novartis (NVS) is one of the largest pharmaceutical companies by revenue. It’s headquartered in Basel, Switzerland. To learn more about the company, read Novartis: Investor Insights into a Pharmaceutical Multinational.
Novartis is set to release its 4Q15 and full-year 2015 earnings on January 27, 2016. Analysts estimate an EPS (earnings-per-share) of $1.32 for 4Q15. Novartis’s stock fell by nearly 4.1% during 2015. Its competitors including Sanofi (SNY) and Merck & Co. (MRK) fell by -3.1% and -4.6%, respectively. GlaxoSmithKline (GSK) and the iShares Global Health Care ETF (IXJ) returned ~0.6% and ~5.4%, respectively, during the same period. To read earnings reviews for other companies, visit Market Realist’s Pharmaceutical Earnings Overview page.
4Q15 revenue estimates
Analysts estimate the revenue for 4Q15 to fall by ~12.0% at $12.9 billion—compared to $14.6 billion for 4Q14. The adjusted revenue, considering the impact of acquisitions and divestments for 4Q14, were $13.1 billion. Novartis acquired GlaxoSmithKline’s oncology business. It divested its vaccines and consumer healthcare divisions to GlaxoSmithKline in March 2015. Considering the adjustments for divested business, analysts expect the revenue to fall by ~2% in 4Q15—compared to adjusted revenue of $13.1 billion for 4Q14.
The major revenue drivers are Pharmaceuticals and Sandoz—the generic pharmaceuticals business. Alcon, Novartis’s eye care business, is expected to have lower sales due to competition in surgical care and contact lens products. What can investors expect from the company’s 4Q15 earnings? Well, you’ll find out in this series.
Novartis’s stock price fell by nearly 4.1% during 2015. Analysts estimate that the stock has the potential to return ~23% over the next 12 months. Analysts’ recommendations show a 12-month targeted price of $105.50 per share—compared to the last price of $86.04 per share as of December 31, 2015. Also, 83% of the analysts recommend a “buy” and 17% of the analysts recommend a “hold,” according to Bloomberg’s consensus. Changes in analysts’ estimates and recommendations are based on changing trends in the stock price.