Buy Rating on Novartis: Near-Term Guidance Headwinds Outweighed by Resilient Fundamentals, Advancing Pipeline, and Supportive Valuation

Sachin Jain, an analyst from Bank of America Securities, maintained the Buy rating on Novartis AG. The associated price target remains the same with CHF130.00.

Sachin Jain has given his Buy rating due to a combination of factors that, in his view, outweigh near‑term guidance headwinds. While FY25 earnings were broadly in line and FY26 guidance implies a mid‑single‑digit downside to consensus EPS, he notes that top-line expectations remain solid and that margin pressure is largely tied to the Avidity transaction and higher financial costs rather than a structural deterioration in the core business. He also highlights that current concerns around revenue deductions in the US and some product-specific misses are partly offset by stronger performance in key growth drivers such as Pluvicto and Cosentyx.

Sachin Jain’s rating is based on the belief that Novartis’s advancing pipeline and recent launches can more than compensate for the looming patent expiries at the end of the decade. He emphasizes that multiple products already on the market are scaling well, and that forthcoming launches such as Rhapsido and ianalumab should further support growth. In addition, he underlines a series of Phase III readouts in 2026–2027 with sizable risk-adjusted peak sales potential, including remibrutinib, abelacimab, and Avidity-partnered assets, which he believes can increasingly rebalance the risk from loss‑of‑exclusivity on key franchises. Overall, he argues that the combination of resilient fundamentals, an underappreciated late-stage pipeline, and a supportive valuation underpins a positive risk‑reward profile for the shares.

According to TipRanks, Jain is a 3-star analyst with an average return of 3.8% and a 57.24% success rate. Jain covers the Healthcare sector, focusing on stocks such as Sanofi, Novartis AG, and Novo Nordisk.

In another report released today, Citi also maintained a Buy rating on the stock with a CHF133.00 price target.