Novartis Low Valuation Signal
Well positioned in generic drugs which will be an important growth area as drug patents expire.
Good financial track record with a Return on Invested Capital of 80.3% and an Earnings yield of 8.7%.
Novartis trades at a Price Earnings (PE) multiple of 9.7X based on adjusted Earnings Per Share (EPS) of $5.57.
Market capitalization of $US 129 billion and S&P has a rating of 4 stars and target of $66.00
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Low valuation signal at USD $54.25. Note that although part of the EPS line is missing prior to 2007, the EPS line has been rising steadily since 1997. The low slope of the EPS line is an indication that the current valuation is the lowest that we’ve seen in 14 years.
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