Trade-Ideas: Novartis (NVS) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Novartis ( NVS) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Novartis as such a stock due to the following factors:

  • NVS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $84.3 million.
  • NVS has traded 1.2 million shares today.
  • NVS is trading at a new lifetime high.

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More details on NVS:

Novartis AG engages in the research, development, manufacture, and marketing of a range of healthcare products worldwide. The stock currently has a dividend yield of 2.7%. NVS has a PE ratio of 19.3. Currently there are 6 analysts that rate Novartis a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Novartis has been 1.4 million shares per day over the past 30 days. Novartis has a market cap of $184.0 billion and is part of the health care sector and drugs industry. Shares are up 18.8% year to date as of the close of trading on Thursday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Novartis as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, NVS's share price has jumped by 25.79%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NVS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 3.9%. Since the same quarter one year prior, revenues slightly increased by 1.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • NVS's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Despite the fact that NVS's debt-to-equity ratio is low, the quick ratio, which is currently 0.66, displays a potential problem in covering short-term cash needs.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Pharmaceuticals industry and the overall market on the basis of return on equity, NOVARTIS AG has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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