Novo Nordisk A/S (NVO): Today's Featured Health Care Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Novo Nordisk A/S ( NVO) pushed the Health Care sector lower today making it today's featured Health Care laggard. The sector as a whole closed the day down 2.0%. By the end of trading, Novo Nordisk A/S fell $4.48 (-2.5%) to $172.15 on light volume. Throughout the day, 235,428 shares of Novo Nordisk A/S exchanged hands as compared to its average daily volume of 366,800 shares. The stock ranged in price between $171.80-$175.78 after having opened the day at $175.76 as compared to the previous trading day's close of $176.63. Other companies within the Health Care sector that declined today were: Progenics Pharmaceuticals ( PGNX), down 13.7%, Astex Pharmaceuticals ( ASTX), down 12.7%, Aastrom Biosciences ( ASTM), down 12.7% and ZELTIQ Aesthetics ( ZLTQ), down 11.9%.
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Novo Nordisk A/S engages in the discovery, development, manufacture, and marketing of pharmaceutical products primarily in Denmark. It operates in two segments, Diabetes Care and Biopharmaceuticals. Novo Nordisk A/S has a market cap of $98.0 billion and is part of the drugs industry. The company has a P/E ratio of 4.0, below the S&P 500 P/E ratio of 17.7. Shares are up 8.2% year to date as of the close of trading on Tuesday. Currently there are 2 analysts that rate Novo Nordisk A/S a buy, 2 analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates Novo Nordisk A/S as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the positive front, MediciNova ( MNOV), down 21.9%, Regeneron Pharmaceuticals ( REGN), down 10.3%, IGI ( IG), down 8.0% and Sarepta Therapeutics ( SRPT), down 7.3%.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health care sector could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health care sector could consider ProShares Ultra Short Health Care ( RXD).

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