Mié, Ene 31 2024
Novartis underperform becomes evident as shares plummet following fourth-quarter results. Analysts’ projections were not met, impacting market standings.
Novartis shares took a significant hit early Wednesday, underperforming against analyst expectations in the fourth quarter. The operating profit margin fell nearly two percentage points short of the AWP consensus.
By 9.20 a.m., Novartis had dropped 4.6% to 88.32 francs, hitting a daily low of 87.68 francs. This decline nearly halved the year-to-date gain of 9.1%. The overall market (SMI) saw a 0.5% decrease, influenced by Novartis. This could be connected to the challenge their sister company is proving to be for them.
Despite adverse currency effects, the Basler Group saw an increase in fourth-quarter sales year-over-year. Yet, expectations for double-digit growth were unmet, appearing overly optimistic in hindsight.
Essential drugs like Entresto performed slightly above forecasts. However, Zolgensma, Lutathera, and Pluvicto fell short in quarterly contributions. The drop in Gilenya sales, an MS medication, was a significant letdown for analysts.
This year’s financial guidance also didn’t meet expectations, with 2024 forecasts slightly below consensus at the revenue level. Core EBIT predictions were particularly disappointing, prompting analysts to potentially lower their estimates by 2-4% for the current year.
The delayed submission of the KRAS inhibitor and the halt in developing Sjögren’s treatment with rem ibrutinib were seen negatively—Additionally, the failure of sabatolimab to meet the primary endpoint in a Phase III trial dampened sentiments.
Bank Vontobel offered a slightly more optimistic view, attributing the weaker fourth quarter to typical end-of-year higher costs and more substantial than anticipated currency impacts. Despite these challenges, the quarter was deemed solid overall.
©Keystone/SDA
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