Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Swiss pharmaceutical giant Novartis
With that in mind, let's take a closer look at Novartis' business and see what CAPS investors are saying about the stock right now.
Novartis facts
Headquarters (founded) |
Basel, Switzerland (1895) |
Market Cap |
$125.36 billion |
Industry |
Pharmaceuticals |
Trailing-12-Month Revenue |
$50.21 billion |
Management |
CEO Joseph Jimenez (since 2007) CFO Jonathan Symonds (since 2009) |
Return on Equity (average, past 3 years) |
15.4% |
Cash/Debt |
$7.99 billion / $26.96 billion |
Dividend Yield |
3% |
Competitors |
Pfizer
GlaxoSmithKline
Merck |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 1,474 members who have rated Novartis believe the stock will outperform the S&P 500 going forward. These bulls include FutureMonkey and All-Star TSIF, who is ranked in the top 0.2% of our community.
Just last month , FutureMonkey tapped Novartis as a healthy income opportunity: "Strong dividend producer that should be here for decades and decades. An excellent long term buy-hold with reinvested dividends to help you get rich slow and steady like."
Fools remain attracted to Novartis' diversified nature, sheer number of potential blockbusters, and cheapish valuation. Currently, Novartis even trades at a P/E (12.5) discount to rivals Pfizer (21.8), GlaxoSmithKline (16.8), and Merck (13.5), as well as other big foes such as Abbott Labs
CAPS All-Star TSIF sums up the bull case:
It is difficult for drug companies to maintain headway when licenses to core revenue drugs expire and generics infringe on the margins, but Novartis has continued to lead in new drug development. ... Veterinary, eye products, OTC drugs, and other diversification also helps. The recession impacts drug companies as well as other industries, but not quite as deeply.
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