A look at Novartis’s earnings
Headquartered in Basel, Switzerland, Novartis (NVS) is one of the largest pharmaceutical companies by revenue. Novartis specializes in the development, manufacturing, and marketing of healthcare products.
The chart above compares Novartis’s revenues and EPS (earnings per share) since 1Q17 along with its estimates for 1Q18. Novartis is set to release its 1Q18 earnings on April 19, 2018. Analysts expect the company to report EPS of $1.28 on revenue of $12.6 billion in 1Q18.
1Q18 revenue estimates
Wall Street analysts expect Novartis’s revenue to rise over 8.8% to $12.6 billion in 1Q18 compared to its revenue of $11.5 billion in 1Q17. This revenue growth is expected due to an increase in operating revenues in all three of the company’s segments: Innovative Medicines, Sandoz, and Alcon. The Innovative Medicines segment includes prescription pharmaceutical products, the Sandoz segment includes generic pharmaceutical products, and the Alcon segment includes eye care products.
Analysts’ estimates show a gross profit margin of ~74.9% for the company in 1Q18, a 0.6% expansion compared to its gross profit margin of ~74.3% in 1Q17. Also, due to lower research and development expenses and higher selling, general, and administrative expenses, the company’s EBITDA (earnings before interest, tax, depreciation, and amortization) margin is expected to contract to ~30.4% in 1Q18 compared to ~32.1% in 1Q17. The company’s net adjusted income is expected to be ~$3.0 billion in 1Q18, a 13.1% rise compared to 1Q17.
The First Trust Value Line Dividend ETF (FVD) holds 5.9% of its total investments in healthcare companies. FVD holds 0.5% in Novartis’s ADR (American depositary receipt), 0.6% in GlaxoSmithKline’s ADR (GSK), 0.5% in Merck & Co. (MRK), and 0.5% in Eli Lilly and Company (LLY).
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