A double beat on the latest quarterly results and raised guidance made investors happy.
Scooting past analyst estimates for its latest quarter gave Novartis (NVS 2.27%) a lift on Tuesday. Investors like what they heard about the global healthcare company’s inaugural earnings release for 2024, and rewarded Novartis with a more than 2% lift in its stock price today. The shares did better than the S&P 500 index, which had a relatively good trading session with a 1.2% gain.
Double beats in the first quarter
In its first quarter, Novartis managed to boost net sales by 11% year over year to $11.8 billion. The pharmaceutical company’s core net income rose by 14% to hit $3.68 billion ($1.80 per share).
Both headline figures came in above the average analyst estimates. Collectively, prognosticators tracking the company were anticipating it would post net sales of $11.43 billion, and a per-share core net income of $1.67.
“Our performance was broad-based, across all key growth brands and geographies,” CEO Vas Narasimhan said.
The company came into 2024 with a new strategic focus. It now considers itself a “pure-play innovative medicines business.” The current Novartis concentrates on four therapeutic areas, each of which it believes has excellent potential.
Guidance raised, although still not very specific
Novartis is clearly feeling confident about this recent strategic shift and its first-quarter results because it raised full-year 2024 guidance.
Management now believes net sales will grow by high-single-digit to low-double-digit percentages compared to 2023; previously it was forecasting a mid-single-digit increase. Core operating income is now anticipated to rise by low-double-digit to mid-teen percentages. This is an improvement over the former estimate in the high single digits. The company did not provide any guidance for either headline or core net income.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
