Heavy Early Morning Activity On Novo Nordisk A/S (NVO)

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 Novo Nordisk A/S ( NVO) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Novo Nordisk A/S as such a stock due to the following factors:

  • NVO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $68.5 million.
  • NVO traded 705,592 shares today in the pre-market hours as of 8:48 AM, representing 40.1% of its average daily volume.

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More details on NVO:

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. The stock currently has a dividend yield of 1.2%. NVO has a PE ratio of 4.0. Currently there is 1 analyst that rates Novo Nordisk A/S a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for Novo Nordisk A/S has been 1.6 million shares per day over the past 30 days. Novo Nordisk A/S has a market cap of $20.4 billion and is part of the health care sector and drugs industry. Shares are up 3.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Novo Nordisk A/S as a buy. The company's strengths can be seen in multiple areas, such as its 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.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 1.1%. Since the same quarter one year prior, revenues rose by 14.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • NVO's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.07, which illustrates the ability to avoid short-term cash problems.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Pharmaceuticals industry and the overall market, NOVO NORDISK A/S's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for NOVO NORDISK A/S is currently very high, coming in at 82.92%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 31.00% significantly outperformed against the industry average.
  • NOVO NORDISK A/S has improved earnings per share by 28.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NOVO NORDISK A/S increased its bottom line by earning $1.37 versus $1.05 in the prior year. This year, the market expects an improvement in earnings ($1.71 versus $1.37).

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