NVS Valuation

Novartis AG

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126.570

+1.07(0.853%)1D

NVS Relative Valuation

NVS's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, NVS is overvalued; if below, it's undervalued.

Historical Valuation

Novartis AG (NVS) is now in the Fair zone, suggesting that its current forward PE ratio of 13.68 is considered Fairly compared with the five-year average of 13.07. The fair price of Novartis AG (NVS) is between 99.26 to 145.48 according to relative valuation methord.

Relative Value

Fair Zone

99.26-145.48

Current Price：126.54

Fair

13.68

Trailing

Forward

11.05

EV/EBITDA

Novartis AG. (NVS) has a current EV/EBITDA of 11.05. The 5-year average EV/EBITDA is 11.56. The thresholds are as follows: Strongly Undervalued below 9.89, Undervalued between 9.89 and 10.73, Fairly Valued between 12.40 and 10.73, Overvalued between 12.40 and 13.23, and Strongly Overvalued above 13.23. The current Forward EV/EBITDA of 11.05 falls within the Historic Trend Line -Fairly Valued range.

12.46

EV/EBIT

Novartis AG. (NVS) has a current EV/EBIT of 12.46. The 5-year average EV/EBIT is 12.37. The thresholds are as follows: Strongly Undervalued below 10.48, Undervalued between 10.48 and 11.43, Fairly Valued between 13.31 and 11.43, Overvalued between 13.31 and 14.26, and Strongly Overvalued above 14.26. The current Forward EV/EBIT of 12.46 falls within the Historic Trend Line -Fairly Valued range.

125.50

Novartis AG. (NVS) has a current PS of 125.50. The 5-year average PS is 4.58. The thresholds are as follows: Strongly Undervalued below -12.12, Undervalued between -12.12 and -3.77, Fairly Valued between 12.94 and -3.77, Overvalued between 12.94 and 21.29, and Strongly Overvalued above 21.29. The current Forward PS of 125.50 falls within the Strongly Overvalued range.

13.05

P/OCF

Novartis AG. (NVS) has a current P/OCF of 13.05. The 5-year average P/OCF is 12.29. The thresholds are as follows: Strongly Undervalued below 10.46, Undervalued between 10.46 and 11.38, Fairly Valued between 13.21 and 11.38, Overvalued between 13.21 and 14.12, and Strongly Overvalued above 14.12. The current Forward P/OCF of 13.05 falls within the Historic Trend Line -Fairly Valued range.

16.06

P/FCF

Novartis AG. (NVS) has a current P/FCF of 16.06. The 5-year average P/FCF is 14.17. The thresholds are as follows: Strongly Undervalued below 12.02, Undervalued between 12.02 and 13.09, Fairly Valued between 15.24 and 13.09, Overvalued between 15.24 and 16.32, and Strongly Overvalued above 16.32. The current Forward P/FCF of 16.06 falls within the Overvalued range.

Novartis AG (NVS) has a current Price-to-Book (P/B) ratio of 5.43. Compared to its 3-year average P/B ratio of 4.71 , the current P/B ratio is approximately 15.37% higher. Relative to its 5-year average P/B ratio of 4.16, the current P/B ratio is about 30.64% higher. Novartis AG (NVS) has a Forward Free Cash Flow (FCF) yield of approximately 8.15%. Compared to its 3-year average FCF yield of 6.99%, the current FCF yield is approximately 16.45% lower. Relative to its 5-year average FCF yield of 6.87% , the current FCF yield is about 18.63% lower.

5.43

P/B

Median3y

4.71

Median5y

4.16

8.15

FCF Yield

Median3y

6.99

Median5y

6.87

Competitors Valuation Multiple

The average P/S ratio for NVS's competitors is 126.97, providing a benchmark for relative valuation. Novartis AG Corp (NVS) exhibits a P/S ratio of 125.50, which is -1.16% above the industry average. Given its robust revenue growth of 8.97%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

P/S

Revenue Growth

Market Cap

Vertex Pharmaceuticals Inc

417.00

10.99%

105.92B

Performance Decomposition

Market capitalization of NVS increased by 18.65% over the past 1 year. The primary factor behind the change was an increase in Margin Expansion from 24.18 to 27.38.

The secondary factor is the Revenue Growth, contributed 8.97%to the performance.

Overall, the performance of NVS in the past 1 year is driven by Margin Expansion. Which is more sustainable.

8.97%

13.17B → 14.35B

Revenue Growth

13.23%

24.18 → 27.38

Margin Expansion

-3.55%

17.83 → 17.19

P/E Change

18.65%