Shares in pharmaceutical giant Novartis (NVS) were flat in pre-market trading today despite lifting its full-year profit guidance.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
Teens Spirit
The group said its core operating income for 2025 was now expected to grow in the low-teens compared with previous guidance of low double-digit growth. It reiterated its guidance for full-year sales of high-single-digit growth.
Novartis reported that its second quarter net sales grew 11%, driven by the strong performance of key medicines such as cardiovascular drug Entresto, multiple-sclerosis drug Kesimpta and breast cancer drug Kisqali.
Novartis made a quarterly net profit of $4.0 billion compared with $3.25 billion for the same period last year. Core operating profit came to $5.925 billion, up 21% at constant currency. Analysts had forecast sales at $14.17 billion and core operating profit at $5.75 billion.
As can be seen below, the performance continues its peer-beating run.
Buyback Boost
Chief executive Vas Narasimhan said: “Our robust balance sheet and confidence in our mid and long-term growth enable us to initiate an up to $10 billion share buyback as part of our commitment to balanced capital allocation.”
It recently completed a $15 billion repurchase program that began in 2023.
There are challenges ahead for Novartis with the patent expiration, and the opening up to generic competitors, for its heart drug Entresto. Although, it pointed out in its results the ‘replacement power’ of new drugs such as Pluvicto for prostate cancer and Scemblix for leukemia.
President Trump’s threatened tariffs on the pharmaceutical sector could be another headache for the group in the months ahead.
As we can see below macro and political risks are key for the stock.
Is NVS a Good Stock to Buy Now?
On TipRanks, NVS has a Moderate Sell consensus based on 2 Hold and 1 Sell ratings. Its highest price target is $138.47. NVS stock’s consensus price target is $111.49, implying a 5.81% downside.
