Why This 1 Value Stock Could Be a Great Addition to Your Portfolio
For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.
Many investors also have a go-to methodology that helps guide their buy and sell decisions. One way to find winning stocks based on your preferred way of investing is to use the Zacks Style Scores, which are indicators that rate stocks based on three widely-followed investing types: value, growth, and momentum.
Why Investors Should Pay Attention to This Value Stock
Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.
Novartis (NVS)
Switzerland-based Novartis has one of the strongest and broadest portfolios of varied drugs that has enabled it to maintain its dominant position as a top pharma company over the years. It continues to build depth in core therapeutic areas like cardiovascular, renal and metabolic, immunology, neuroscience and oncology in geographies like the United States, China, Germany and Japan. Novartis’ efforts to strengthen its wide portfolio by developing breakthrough treatments have made it even more formidable in this space. Kesimpta, Pluvicto, Scemblix, Kisqali, Leqvio and Fabhalta should fuel growth.
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NVS boasts a Value Style Score of B and VGM Score of B, and holds a Zacks Rank #2 (Buy) rating. Shares of Novartis are trading at a forward earnings multiple of 13.2X, as well as a PEG Ratio of 1.7, a Price/Cash Flow ratio of 10.8X, and a Price/Sales ratio of 4.7X.
Many value investors pay close attention to a company's earnings as well. For NVS, five analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.27 to $8.74 per share for 2025. Per share NVS boasts an average earnings surprise of 7.1%.
NVS should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores.
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Novartis AG (NVS) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).