In a report released today, Thibault Boutherin from Morgan Stanley upgraded Novartis AG to a Hold, with a price target of CHF100.00.
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Thibault Boutherin has given his Hold rating due to a combination of factors including Novartis AG’s balanced risk-reward profile within the European large cap pharmaceutical sector. Novartis is favored over Roche due to its slightly better mid-term growth prospects and potential for positive surprises in commercial execution and catalyst development. The company’s strategy of bolt-on mergers and acquisitions in its key therapeutic areas is seen as a strong approach to addressing loss of exclusivity challenges.
While Novartis has a strong balance sheet and cash flow generation, its valuation remains demanding relative to its growth profile. However, the quality of growth is considered higher, with potential pipeline upsides from upcoming readouts. Overall, the Hold rating reflects a cautious optimism, recognizing both the opportunities and challenges faced by Novartis in the coming years.
Boutherin covers the Healthcare sector, focusing on stocks such as Novo Nordisk, Indivior, and Bayer. According to TipRanks, Boutherin has an average return of 2.0% and a 42.86% success rate on recommended stocks.