Analysts Give Mixed Recommendations for Novartis

Analysts’ estimates

As discussed earlier, Novartis (NVS) reported EPS of $1.28 and revenue of $12.7 billion in the first quarter. In the second quarter, its revenue is expected to rise 7.8% year-over-year to $13.2 billion from $12.2 billion. The chart below shows analysts’ recommendations for Novartis over the last 12 months.

Analysts Give Mixed Recommendations for Novartis

Analysts’ recommendations

Novartis’s stock price has fallen ~7.0% in the last 12 months and ~10.7% year-to-date. Analysts’ 12-month target price of $88.17 implies a ~17.6% potential return based on the stock’s May 29 price of $74.96.

Of the four analysts covering Novartis ADRs,[1.American depositary receipts] one recommends “strong buy,” one recommends “buy,” one recommends “hold,” and one recommends “sell.” Their consensus rating for Novartis ADRs is 2.5, representing a moderate “buy” for long-term growth and value investors.

Of the 28 analysts covering Novartis stock on SIX Swiss Exchange, seven recommend “strong buy,” eight recommend “buy,” 11 recommend “hold,” and two recommend “sell.” Their consensus rating for Novartis is 2.3, which also represents a moderate “buy” for value investors.

The Vanguard FTSE All-World ex-US ETF (VEU) invests 0.7% of its holdings in Novartis, 0.4% in GlaxoSmithKline (GSK), 0.4% in AstraZeneca (AZN), and 0.1% in Teva Pharmaceutical (TEVA).

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