Novartis stock slumped Tuesday — undercutting the lower boundary of a flat base — after sales of its biggest moneymaker missed third-quarter expectations.
Though sales of heart-failure treatment Entresto surged 26% in constant currency, $1.87 billion in sales lagged forecasts for $1.88 billion. Edward Jones analyst John Boylan noted Entresto will lose patent protection in the coming year.
Novartis stock tumbled 4.4%, closing at 110.50. Shares fell below the lower edge of a flat base with a buy point at 120.92, according to MarketSurge. Novartis stock is also losing support at its 10-week moving average.
Novartis Stock: Earnings Surge And Beat
Overall, Novartis earned $2.06 per share on $12.82 billion in sales. Earnings climbed 18%, or 20% in constant currency, and beat expectations for $1.94. Sales grew 9% and topped views for $12.79 billion, according to FactSet. Excluding the impact of exchange rates, sales rose 10%.
"This was a good quarter," Edward Jones' Boylan said in a report. "But much like last quarter, we believe investors were expecting one."
Novartis put up several strong numbers. Revenue from cancer treatment Kisqali came in at $787 million, growing 43% in constant currency. Analysts projected a lower $769 million. But Boylan says investors may have been hoping for a better showing "due to ongoing momentum for this drug."
On a positive note, revenue from immunology drug Cosentyx and cancer treatment Pluvicto beat expectations.
The company raised its guidance for the year and now expects sales to grow by a low-double-digit percentage. Previously, Novartis guided sales to high-single-digit or low-double-digit growth. Novartis stock analysts projected $50.07 billion in sales, a 10% increase over 2023.
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