Johnson & Johnson (JNJ) vs Novartis AG (NVS)

Johnson & Johnson and Novartis AG are both Drug Manufacturers General companies. Johnson & Johnson is the larger, with a market value of $652.8B against $264.3B — 2.5× the size. Novartis AG trades at the lower P/E: 21.8× against 31.4×. Johnson & Johnson grew revenue faster over the last twelve months: 8.06% against 2.73%. Novartis AG has the higher net margin (22.5% vs 21.5%) and the lower return on invested capital (13.1% vs 15.5%). Both pay a dividend; Novartis AG yields more (3.69% vs 3.07%). Across the 23 metrics below, Novartis AG leads on 15 and Johnson & Johnson on 8.

Valuation

Metric JNJ NVS Drug Manufacturers General median
P/E 31.43 21.84 24.72
P/S 6.67 4.89 3.35
P/B 7.68 6.61 5.00
Price to free cash flow 28.73 18.26 17.68
EV/EBITDA 19.20 14.04 13.91
EV/Sales 6.84 5.58 3.95
Earnings yield 3.18% 4.58% 2.92%
Free cash flow yield 3.48% 5.48% 4.42%

Profitability

Metric JNJ NVS Drug Manufacturers General median
Gross margin 67.91% 74.74% 72.77%
Operating margin 27.69% 30.17% 18.90%
Net margin 21.48% 22.50% 8.27%
Free cash flow margin 23.20% 26.77% 17.25%
Return on equity 25.74% 30.37% 6.97%
Return on assets 10.67% 11.27% 2.76%
Return on invested capital 15.51% 13.14% 6.30%

Growth

Metric JNJ NVS Drug Manufacturers General median
Revenue growth (TTM) 8.06% 2.73% 6.79%
EPS growth (last fiscal year) 90.50% 21.81% —
Revenue growth, 5-year CAGR 2.67% 2.58% 3.98%
Net income growth, 5-year CAGR 12.74% 11.62% 0.42%

Health

Metric JNJ NVS Drug Manufacturers General median
Debt to equity 0.44 1.12 0.63
Current ratio 1.09 0.86 1.32
Net debt to EBITDA 0.46 0.96 1.15

Dividend

Metric JNJ NVS Drug Manufacturers General median
Dividend yield 3.07% 3.69% 3.57%
Payout ratio 0.93 0.97 0.53

Size

Metric JNJ NVS Drug Manufacturers General median
Market cap 652.82b 264.33b 125.91b

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