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NovoCure Ltd (NVCR)
NASDAQ:NVCR
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NovoCure
(NASDAQ:NVCR)
45Neutral
Positive Factors
Clinical Trials
The successful Phase 3 PANOVA-3 trial in pancreatic cancer demonstrated a statistically significant improvement in overall survival, strengthening the clinical evidence supporting TTFields therapy.
Regulatory Approvals
Optune Lua received CE Mark approval in Europe, representing a meaningful regulatory milestone and a potential catalyst for Optune Lua's expansion into international markets.
Revenue Growth
NVCR reported a ~19% increase in year-over-year net revenues, primarily due to the success of Optune Gio's launch in France and improved approval rate in the U.S.
Negative Factors
Prescription Decline
Prescriptions for Optune Gio shrunk overall in 4Q24 with 1,520 received in the quarter compared to 1,586 in 3Q24, a 4% decrease.
Revenue Decline
Revenue in Greater China was below estimates and represented only about half of historical quarterly revenue.
Tariff Impact
Management shared their expectation on the potential impact of recent global tariff changes, projecting an increase in import duties of up to $8-11M in 2025.
NovoCure (NVCR) vs. S&P 500 (SPY)
Market Cap
$2.02B
Dividend YieldN/A
Average Volume (3M)883.20K
Price to Earnings (P/E)―
Beta (1Y)1.56
Revenue Growth18.27%
EPS Growth16.28%
CountryUS
Employees1,488
SectorHealthcare
Sector Strength38
IndustryMedical - Instruments & Supplies
Share Statistics
EPS (TTM)-0.31
Shares Outstanding111,485,634
10 Day Avg. Volume878,938
30 Day Avg. Volume883,197
Financial Highlights & Ratios
PEG Ratio-3.64
Price to Book (P/B)5.30
Price to Sales (P/S)0.00
P/FCF Ratio-26.86
Enterprise Value/Market Cap1.24
Enterprise Value/Revenue1.06
Enterprise Value/Gross Profit5.23
Enterprise Value/Ebitda-4.97
Forecast
1Y Price Target
$34.00Price Target Upside93.29% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
NovoCure Business Overview & Revenue Model
Company DescriptionNovoCure (NVCR) is a global oncology company pioneering a novel therapy called Tumor Treating Fields (TTFields) for the treatment of solid tumors. The company operates in the healthcare sector, focusing on the development and commercialization of non-invasive, portable devices that utilize electric fields to disrupt cancer cell division. NovoCure's core product, Optune, is approved for the treatment of glioblastoma, a type of brain cancer, and the company is actively researching its application for other types of solid tumors.
How the Company Makes MoneyNovoCure generates revenue primarily through the sale and leasing of its TTFields therapy devices, particularly Optune, to healthcare providers and patients. The company's revenue model is centered on a durable medical equipment model, where patients typically rent the devices for the duration of their treatment. NovoCure also earns revenue from reimbursement by insurance companies and government health programs, as TTFields therapy is increasingly recognized and covered by these entities. Additionally, the company engages in partnerships and collaborations with research institutions and pharmaceutical companies to expand the potential indications for its technology, which may contribute to future revenue growth.
NovoCure Financial Statement Overview
Summary
NovoCure is experiencing moderate revenue growth but faces profitability challenges with negative profit margins. While its balance sheet is stable, leverage and cash flow issues are pressing concerns, highlighting the need for improved operational efficiencies and cash generation.Income Statement
NovoCure has shown a modest increase in revenue over the TTM period, with a revenue growth rate of 2.72%. However, the company is struggling with profitability, as indicated by negative net profit and EBIT margins of -26.41% and -26.84% respectively. The gross profit margin is relatively healthy at 77.16%, suggesting strong core operations but high operational costs are eroding profitability.45
Neutral
Balance Sheet
The balance sheet presents a mixed picture. NovoCure has a relatively high debt-to-equity ratio of 0.25, indicating moderate leverage. The return on equity is negative due to the net loss, but the equity ratio is a healthy 59.98%, indicating a stable capital structure with sufficient equity backing.50
Neutral
Cash Flow
Cash flow is a concern for NovoCure, with negative free cash flow of -$72.14 million and deterioration in free cash flow growth. The operating cash flow to net income ratio is negative, reflecting challenges in converting profits into cash. The company appears to be burning cash, which poses a risk if not addressed.40
Negative
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 621.71M | 605.22M | 509.34M | 537.84M | 535.03M | 494.37M | Gross Profit |
| 479.70M | 468.04M | 381.06M | 422.97M | 420.15M | 387.87M | EBIT |
| -166.87M | -170.50M | -232.87M | -89.52M | -44.33M | 21.25M | EBITDA |
| -105.45M | -108.26M | -175.87M | -63.11M | -38.38M | 45.30M | Net Income Common Stockholders |
| -164.19M | -168.63M | -207.04M | -92.53M | -58.35M | 19.81M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 929.13M | 962.20M | 910.62M | 969.42M | 937.70M | 842.58M | Total Assets |
| 1.25B | 1.24B | 1.15B | 1.19B | 1.14B | 1.05B | Total Debt |
| 696.73M | 683.35M | 596.24M | 584.27M | 575.21M | 444.20M | Net Debt |
| 569.45M | 519.59M | 355.42M | 468.94M | 366.41M | 209.52M | Total Liabilities |
| 886.85M | 880.61M | 783.63M | 750.48M | 729.00M | 575.46M | Stockholders Equity |
| 361.96M | 360.18M | 362.50M | 441.17M | 410.49M | 476.53M |
| Cash Flow | Free Cash Flow | ||||
| -72.14M | -69.22M | -100.43M | 9.43M | 58.59M | 84.18M | Operating Cash Flow |
| -30.46M | -26.37M | -73.34M | 30.79M | 82.76M | 99.15M | Investing Cash Flow |
| -392.93M | -140.24M | 184.15M | -139.96M | -144.83M | -472.85M | Financing Cash Flow |
| 95.35M | 90.31M | 15.79M | 15.49M | 25.70M | 440.21M |
NovoCure Technical Analysis
Negative
17.59
Price Trends
18.00
Negative
21.57
Negative
20.33
Negative
Market Momentum
-0.06
Negative
49.52
Neutral
53.38
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NVCR, the sentiment is Negative. The current price of 17.59 is above the 20-day moving average (MA) of 17.51, below the 50-day MA of 18.00, and below the 200-day MA of 20.33, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 49.52 is Neutral, neither overbought nor oversold. The STOCH value of 53.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NVCR.
NovoCure Risk Analysis
NovoCure disclosed 41 risk factors in its most recent earnings report. NovoCure reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
NovoCure Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $1.56B | ― | -8.38% | ― | 15.79% | -1.20% | |
60 Neutral | $2.40B | ― | -10.59% | ― | -3.18% | 81.18% | |
60 Neutral | $311.97M | ― | -28.58% | ― | 34.65% | -128.56% | |
57 Neutral | $941.00M | 55.81 | -19.14% | ― | -14.44% | -557.38% | |
54 Neutral | $1.05B | ― | -3.29% | ― | -23.12% | 97.46% | |
52 Neutral | $5.04B | 3.15 | -44.58% | 2.85% | 16.08% | -0.27% | |
45 Neutral | $2.02B | ― | -45.52% | ― | 18.27% | 16.28% |
* Healthcare Sector Average
Performance Comparison
NVCR
NovoCure
17.59
-4.58
-20.66%
ATRC
Atricure
32.30
9.67
42.73%
QDEL
QuidelOrtho
33.03
-10.96
-24.91%
STAA
Staar Surgical
18.29
-24.33
-57.09%
BLFS
BioLife Solutions
21.99
0.02
0.09%
SMTI
Sanara MedTech
30.88
-0.82
-2.59%
NovoCure Earnings Call Summary
Earnings Call Date:Apr 24, 2025
(Q1-2025)
| % Change Since: -1.01%|
Next Earnings Date:Jul 24, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted NovoCure Limited's successful expansion efforts with CE Mark approval in Europe and promising clinical trial results, which are overshadowed by financial losses and margin pressures. The company's strategic focus on expanding indications shows potential for growth, but current financial challenges are notable.Q1-2025 Updates
Positive Updates
CE Mark Approval for OptuneLua
OptuneLua received European CE Mark approval for metastatic non-small cell lung cancer, allowing for concomitant treatment with immune checkpoint inhibitors or docetaxel. This approval opens up the European market, with Germany being launch-ready pending local registration.
Panova Three Clinical Trial Success
The Panova three phase three clinical trial in unresectable locally advanced pancreatic cancer demonstrated a meaningful survival benefit and was accepted for presentation at the ASCO annual meeting. This trial is the first and only phase three trial to show such a benefit in this cancer type.
Strong Financial Performance
NovoCure Limited reported $155 million in net revenue for Q1 2025, a 12% increase year-over-year. Active patients grew by 40% in France, 17% in Japan, 10% in Germany, and 4% in the US.
Non-Small Cell Lung Cancer Launch Success
The early commercial indicators for the US launch of OptuneLua for non-small cell lung cancer are promising, with 92 prescriptions and 62 patients on therapy in Q1 2025.
Expansion of Active Patient Base
The GBM segment showed strong performance with a record 4,162 active patients globally, highlighting continued growth especially in France and Japan.
Negative Updates
Gross Margin Decline
Gross margin for the quarter was 75%, down from 76% in the prior year period, due to the rollout of HFE arrays and the NACOC launch treating unlabeled patients before establishing broad reimbursement.
Tariff Uncertainty
Potential tariff changes could impact 2025 cost of goods by up to $11 million if tariffs return to increased rates, adding financial pressure.
Net Loss in Q1 2025
NovoCure Limited reported a net loss of $34 million for the quarter with a loss per share of $0.31, reflecting investment in growth and new product launches.
Company Guidance
In NovoCure Limited's first quarter 2025 earnings call, several key metrics highlighted the company's momentum and strategic focus. The quarter saw a net revenue of $155 million, marking a 12% increase from the previous year, driven by a 40% patient growth in France and other regions. The company reported 92 prescriptions for non-small cell lung cancer, with 62 patients on therapy by the end of the quarter, alongside 44 mesothelioma patients, totaling 106 Optima active patients. NovoCure also celebrated the CE Mark approval for OptuneLua in Europe, positioning them for a launch in Germany. Additionally, the company managed to collect $1.5 million from OptuneLua claims, reflecting initial reimbursement efforts. Their adjusted EBITDA was negative $5 million, while they maintained a robust cash and investment balance of $929 million. Despite a quarterly net loss of $34 million, NovoCure remains focused on expanding its reach across multiple indications, leveraging its infrastructure for anticipated future growth and profitability.NovoCure Corporate Events
Product-Related Announcements
NovoCure’s Optune Lua Gains CE Mark Approval
Positive
Apr 22, 2025
On April 22, 2025, Novocure announced that its Optune Lua® device received CE Mark approval for treating adult patients with metastatic non-small cell lung cancer (mNSCLC) in conjunction with immune checkpoint inhibitors or docetaxel, following progression on a platinum-based regimen. This approval, supported by the Phase 3 LUNAR trial, marks a significant milestone for Novocure, as Optune Lua demonstrated a substantial improvement in median overall survival for this patient group, offering a promising new treatment option with minimal systemic toxicity. Novocure is preparing to launch Optune Lua in Germany, following local registration requirements, and will conduct a post-market study to further assess its effectiveness.
Spark’s Take on NVCR Stock
According to Spark, TipRanks’ AI Analyst, NVCR is a Neutral.
NovoCure shows potential with revenue growth and successful expansions into new indications. However, significant challenges remain, including ongoing net losses, cash flow issues, and increased operating expenses. Technical indicators suggest a bearish trend, while valuation metrics highlight concerns due to negative earnings and no dividend yield. The earnings call reflects some optimism with strategic expansions but also emphasizes hurdles related to reimbursement and margin pressures.
To see Spark’s full report on NVCR stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.