Novartis Beats Analyst Estimates on EPS

Novartis (NYSE: NVS) reported earnings on July 19. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), Novartis met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue contracted and GAAP earnings per share contracted.

Gross margins shrank, operating margins dropped, net margins grew.

Revenue details
Novartis logged revenue of $14.30 billion. The 11 analysts polled by S&P Capital IQ predicted a top line of $14.20 billion on the same basis. GAAP reported sales were 3.8% lower than the prior-year quarter's $15.12 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.38. The nine earnings estimates compiled by S&P Capital IQ predicted $1.33 per share. GAAP EPS of $1.11 for Q2 were 0.9% lower than the prior-year quarter's $1.12 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 68.3%, 120 basis points worse than the prior-year quarter. Operating margin was 21.9%, 10 basis points worse than the prior-year quarter. Net margin was 18.6%, 70 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $14.36 billion. On the bottom line, the average EPS estimate is $1.38.

Next year's average estimate for revenue is $57.20 billion. The average EPS estimate is $5.22.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Novartis is outperform, with an average price target of $62.04.

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