Amgen Inc. (AMGN) vs Novartis AG (NVS)

Amgen Inc. and Novartis AG are both Drug Manufacturers General companies. Novartis AG is the larger, with a market value of $264.3B against $219.1B — 1.2× the size. Novartis AG trades at the lower P/E: 21.8× against 25.6×. Amgen Inc. grew revenue faster over the last twelve months: 9.10% against 2.73%. Amgen Inc. has the higher net margin (23.0% vs 22.5%) and the lower return on invested capital (13.0% vs 13.1%). Both pay a dividend; Novartis AG yields more (3.69% vs 3.16%). Across the 23 metrics below, Novartis AG leads on 17 and Amgen Inc. on 6.

Valuation

Metric AMGN NVS Drug Manufacturers General median
P/E 25.56 21.84 24.72
P/S 5.88 4.89 3.35
P/B 19.16 6.61 5.00
Price to free cash flow 22.98 18.26 17.68
EV/EBITDA 16.20 14.04 13.91
EV/Sales 7.01 5.58 3.95
Earnings yield 3.91% 4.58% 2.92%
Free cash flow yield 4.35% 5.48% 4.42%

Profitability

Metric AMGN NVS Drug Manufacturers General median
Gross margin 69.52% 74.74% 72.77%
Operating margin 29.99% 30.17% 18.90%
Net margin 22.95% 22.50% 8.27%
Free cash flow margin 26.71% 26.77% 17.25%
Return on equity 91.47% 30.37% 6.97%
Return on assets 9.53% 11.27% 2.76%
Return on invested capital 12.98% 13.14% 6.30%

Growth

Metric AMGN NVS Drug Manufacturers General median
Revenue growth (TTM) 9.10% 2.73% 6.79%
EPS growth (last fiscal year) 88.23% 21.81% —
Revenue growth, 5-year CAGR 7.65% 2.58% 3.98%
Net income growth, 5-year CAGR 1.20% 11.62% 0.42%

Health

Metric AMGN NVS Drug Manufacturers General median
Debt to equity 4.90 1.12 0.63
Current ratio 1.37 0.86 1.32
Net debt to EBITDA 2.94 0.96 1.15

Dividend

Metric AMGN NVS Drug Manufacturers General median
Dividend yield 3.16% 3.69% 3.57%
Payout ratio 0.55 0.97 0.53

Size

Metric AMGN NVS Drug Manufacturers General median
Market cap 219.05b 264.33b 125.91b

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