Novartis stock inched higher Tuesday after the drugmaker hiked its earnings outlook for the third time this year following its Sandoz spinoff.
The Switzerland-based pharmaceutical company beat third-quarter earnings expectations, but sales came in lighter than some analysts expected. Edward Jones analyst John Boylan said it was a "decent yet unsurprising result as good sales and profit trends we saw last quarter continued."
On today's stock market, Novartis stock rose 0.2% to 94.91. Shares are working to retake their 50-day moving average, according to MarketSmith.com. Novartis stock is forming a flat base with a buy point at 99.93.
Novartis Stock: Mixed Earnings Report
During the September quarter, Novartis' core earnings grew 29% in constant currency to $1.74 a share. That easily topped the FactSet-polled forecast for $1.67 and the $1.69 per-share projection cited by Boylan. Sales climbed 12% to $11.78 billion, below calls for $12.42 billion.
The light sales come after Novartis finished spinning off its generic drugs business, Sandoz. It's unclear whether analysts included Sandoz in their projections.
Boylan noted multiple sclerosis treatment Kesimpta benefited from a one-time sales adjustment. Meanwhile, revenue from cancer drug Kisqali came in better than expected at $562 million. Wall Street projected $524 million in sales from Kisqali. In constant currency, sales skyrocketed 76% year over year.
"This was partially offset by modestly slower-than-expected sales of Entresto" in heart failure treatment, Boylan said in a report. Entresto sales popped 31% to $1.49 billion. But analysts polled by FactSet saw it differently. Entresto beat their consensus for a lower $1.47 billion.
Novartis increased its core operating income guidance for the third time this year. Now, the firm expects a mid- to high-teens percentage increase, up from the prior outlook for low double-digit growth. The company retained its sales outlook for a high single-digit percentage increase.
Novartis stock analysts forecast earnings of $6.49 per share and $50.42 billion in sales. On a year-over-year basis, earnings would jumped 12% and sales would be flat.
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