New Lifetime High Reached: 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 new lifetime high 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 $99.9 million.
  • NVO has traded 33,346 shares today.
  • NVO is trading at a new lifetime high.

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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%. 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 $121.2 billion and is part of the health care sector and drugs industry. Shares are up 19.3% year-to-date as of the close of trading on Thursday.

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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, solid stock price performance and growth in earnings per share. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • NVO's revenue growth has slightly outpaced the industry average of 2.8%. Since the same quarter one year prior, revenues slightly increased by 6.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • NVO's debt-to-equity ratio is very low at 0.01 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 1.22, 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.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.73% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NVO should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • NOVO NORDISK A/S has improved earnings per share by 11.6% 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 $1.73 versus $1.37 in the prior year. This year, the market expects an improvement in earnings ($1.89 versus $1.73).

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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