NVO, NVS And ACT, Pushing Drugs Industry Downward

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

All three major indices are trading up today with the Dow Jones Industrial Average ( ^DJI) trading up 153 points (1.0%) at 15,456 as of Tuesday, May 28, 2013, 12:50 PM ET. The NYSE advances/declines ratio sits at 2,106 issues advancing vs. 846 declining with 109 unchanged.

The Drugs industry currently sits up 1.0% versus the S&P 500, which is up 0.9%. Top gainers within the industry include Valeant Pharmaceuticals International ( VRX), up 7.2%, Biogen Idec ( BIIB), up 2.5%, Celgene Corporation ( CELG), up 2.2%, Abbott Laboratories ( ABT), up 2.0% and AstraZeneca ( AZN), up 1.5%.

TheStreet Ratings group would like to highlight 3 stocks pushing the industry lower today:

3. Novo Nordisk A/S ( NVO) is one of the companies pushing the Drugs industry lower today. As of noon trading, Novo Nordisk A/S is down $1.50 (-0.9%) to $167.14 on average volume Thus far, 132,984 shares of Novo Nordisk A/S exchanged hands as compared to its average daily volume of 282,900 shares. The stock has ranged in price between $167.05-$169.67 after having opened the day at $169.06 as compared to the previous trading day's close of $168.64.

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 $92.8 billion and is part of the health care sector. The company has a P/E ratio of 4.0, below the S&P 500 P/E ratio of 17.7. Shares are up 3.3% year to date as of the close of trading on Friday.

TheStreet Ratings rates Novo Nordisk A/S as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow. Get the full Novo Nordisk A/S Ratings Report now.

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2. As of noon trading, Novartis ( NVS) is down $1.07 (-1.4%) to $73.29 on heavy volume Thus far, 1.2 million shares of Novartis exchanged hands as compared to its average daily volume of 1.6 million shares. The stock has ranged in price between $73.11-$73.79 after having opened the day at $73.52 as compared to the previous trading day's close of $74.36.

Novartis AG engages in the research, development, manufacture, and marketing of a range of healthcare products worldwide. Novartis has a market cap of $182.7 billion and is part of the health care sector. The company has a P/E ratio of 19.1, above the S&P 500 P/E ratio of 17.7. Shares are up 17.5% year to date as of the close of trading on Friday.

TheStreet Ratings rates Novartis as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, revenue growth and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow. Get the full Novartis Ratings Report now.

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1. As of noon trading, Actavis ( ACT) is down $2.53 (-2.0%) to $124.70 on heavy volume Thus far, 1.4 million shares of Actavis exchanged hands as compared to its average daily volume of 1.6 million shares. The stock has ranged in price between $124.32-$128.64 after having opened the day at $128.00 as compared to the previous trading day's close of $127.23.

Actavis, Inc., an integrated specialty pharmaceutical company, engages in developing, manufacturing, marketing, selling, and distributing generic, branded generic, brand, biosimilar, and over-the-counter pharmaceutical products worldwide. Actavis has a market cap of $16.3 billion and is part of the health care sector. Shares are up 47.9% year to date as of the close of trading on Friday.

TheStreet Ratings rates Actavis as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Get the full Actavis Ratings Report now.

Exclusive Offer: Jim Cramer's 'go-to' small/mid-cap guru Bryan Ashenberg only buys stocks he thinks could return 50-100%. See his top picks for 14-days FREE.

If you are interested in one of these 5 stocks, ETFs may be of interest. Investors who are bullish on the drugs industry could consider SPDR S&P Pharmaceuticals ETF ( XPH) while those bearish on the drugs industry could consider ProShares UltraShort Nasdaq Biotech ( BIS).

A reminder about TheStreet Ratings group: 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.

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