A look at Novartis
Novartis (NVS), a leading pharmaceutical company, reported EPS of $1.29 on revenues of $13.2 billion in Q2 2018, a 5% growth year-over-year compared to $12.2 billion in Q2 2017. Foreign exchange had a 2% favorable impact on revenues during the quarter.
The above chart compares revenues and EPS for Novartis since the first quarter of 2017.
Forward PE multiple
On August 28, Novartis was trading at a forward PE multiple of ~15.4x compared to the industry average of ~14.1x. Competitors Johnson & Johnson (JNJ), Eli Lilly (LLY), and GlaxoSmithKline (GSK) are trading at forward PE multiples of 16.1x, 18.6x, and 13.8x, respectively.
On a capital structure neutral basis, Novartis currently trades at a forward EV[1. enterprise value]-to-EBITDA multiple of ~13.6x, which is much higher than the industry average of ~11.8x as of August 28. Competitors Johnson & Johnson (JNJ), Eli Lilly (LLY), and GlaxoSmithKline (GSK) are trading at forward EV-to-EBITDA multiples of 12.1x, 14.4x, and 10.1x, respectively, compared to Novartis.
Forward EV-to-revenue multiple
Novartis currently trades at a forward EV-to-revenue multiple of ~4.3x, which is higher than the industry average of ~4.2x as of August 28. Johnson & Johnson (JNJ), Eli Lilly (LLY), and GlaxoSmithKline (GSK) are trading at forward EV-to-revenue multiples of 4.5x, 4.8x, and 3.2x, respectively, compared to Novartis.
Sandoz, Novartis's generic pharmaceuticals business, reported nearly flat revenues at ~$2.46 billion in Q2 2018.
Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.
The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.
Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.
Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.
As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.
Kimberly-Clark (KMB) stock has risen 20.5% this year, boosted by the company’s better-than-expected sales and earnings during its last reported quarter. However, its stock could stop climbing. Here's why.