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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 $296.4B against $248.8B — 1.2× the size. Amgen Inc. trades at the lower P/E: 26.5× against 30.9×. Amgen Inc. grew revenue faster over the last twelve months: 8.15% against 1.76%. Amgen Inc. has the higher net margin (24.1% vs 17.5%) and the higher return on invested capital (14.3% vs 12.1%). Both pay a dividend; Novartis AG yields more (2.92% vs 2.16%). Across the 23 metrics below, Novartis AG leads on 12 and Amgen Inc. on 11.

Valuation

Metric AMGN NVS Drug Manufacturers General median
P/E 26.51 30.91 26.51
P/S 6.41 5.36 3.49
P/B 17.37 8.19 5.28
Price to free cash flow 27.25 21.76 21.67
EV/EBITDA 16.91 15.59 14.73
EV/Sales 7.46 6.02 4.15
Earnings yield 3.77% 3.24% 2.41%
Free cash flow yield 3.67% 4.60% 4.07%

Profitability

Metric AMGN NVS Drug Manufacturers General median
Gross margin 70.90% 74.92% 73.01%
Operating margin 32.41% 25.18% 18.34%
Net margin 24.14% 17.49% 7.31%
Free cash flow margin 24.63% 24.66% 18.56%
Return on equity 78.35% 24.37% 5.80%
Return on assets 10.09% 8.94% 2.28%
Return on invested capital 14.29% 12.05% 6.26%

Growth

Metric AMGN NVS Drug Manufacturers General median
Revenue growth (TTM) 8.15% 1.76% 6.72%
EPS growth (last fiscal year) 88.23% 21.81% 21.81%
Revenue growth, 5-year CAGR 7.65% 2.58% 4.75%
Net income growth, 5-year CAGR 1.20% 11.62% 0.00%

Health

Metric AMGN NVS Drug Manufacturers General median
Debt to equity 3.76 1.23 0.62
Current ratio 1.48 0.88 1.39
Net debt to EBITDA 2.94 0.96 1.15

Dividend

Metric AMGN NVS Drug Manufacturers General median
Dividend yield 2.16% 2.92% 2.32%
Payout ratio 0.58 0.91 0.59

Size

Metric AMGN NVS Drug Manufacturers General median
Market cap 248.84b 296.42b 129.04b

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