Novartis AG Stock Update

The pharmaceutical company is expected to face a little competition in the near future.

In 2014, Novartis announced a shutdown of a number of its sites as it was planning to restructure its pharmaceutical division. One of these sites was the Rockland County property for close for over two years now primarily in Suffern. This huge campus was used in the manufacturing of tablets, inhalation products, and capsules for the pharmaceutical company. According to a real estate broker, this deal of selling more than 160 acres of the company is likely to close as early as winter.

The firm has narrowed the potential buyers to two in which both have industrial and commercial use that will divide the campus into more multiple tenants, according to Andrew Merin, a broker at the research and financial services firm ‘Cushman and Wakefield’s Metropolitan Area Capital’. This deal is expected to be finalized in the first quarter of the upcoming year.

In other news on Tuesday, Novartis stock traded at a share price of $87. During the course of the trade, the share price went as high as $88.16 and low as $87.70. It kept fluctuating between these numbers and was finally called off at $88.05 indicating an increase of 1.50%. The traded commenced at a share price of $87.87.

The pharmaceutical giant has received a rating of “Buy” by the research firm Zack’s, which is an upgrade from an initial “Hold” rating. The price target suggested by Zack’s is $97.00 on the stock of the drug-maker. The earnings result posted for the third quarter was quite disappointing, as it posted lower than expected earnings per share. It is expected that it will be facing competition in the near future for some of its products.

A 52-week low in the share price of the drug-maker was registered at $83.66 and a 52-week high in the share price was registered at $106.84. The current market capitalization of the pharm organization is $230.77 billion, along with earnings per share of 3.44 and price to earnings ratio of $25.61. The latest earnings results were reported on October 27. 2015. For the quarter, the EPS was reported to be $1.27, which was not up to analysts’ expectations of $1.31. There was a difference of $0.04 between the actual and the estimated earnings.

The revenue according to the earnings result was of $12.30 billion and the stock experts had predicted it to be $12.66 billion. The Switzerland based organization has an average of “Buy” and a price target of $103.50.

CVS Health Witnesses Hike In Dividends

After the finalization of the Target deal, the stock of the healthcare company has increased.

CVS Health Corporation recently acquired Target’s pharmacy along with clinic business due to which, during the pre-market trading, the stock of the healthcare company went up by 2.04% and traded at $94.48 per share. The pharmaceutical company also declared its quarterly dividend of $0.425 per share.

The following year, the pharma company has planned to raise its earnings outlook at the Annual Investor’s Day that will be held in New York. A recent press release of the company suggested that the estimations of adjusted earnings of CVS are within $5.73 and $5.88. These estimated earnings could suggest a year-over-year growth of 11.25 – 14.25%. In comparison to the earnings call for the third quarter, the health care company has increased its calculations by $0.05 per share.

As for the free cash flow predictions, CVS health is planning to generate $5.3-5.6 billion (FCF). About the common shares of the company, the board of directors has announced an increase of 21% in its quarterly cash dividends to $0.425. This increase in the cash dividend will result in an increase in the company’s three-month dividend as well, which is payable on February 2 of the following year. This dividend, which will be paid in 2016, will mark the increase in dividend for the 13^th time since the year 2011. Presently, 28% is the compound annual growth rate of the company.

The acquisition of Target’s pharmacy and clinic business was a deal worth $1.9 billion, which was also announced at the Investor’s Day by the drugstore chain. It now owns over 1,672 of Target’s pharmacies in 47 different states. The operations at these pharmacies will be carried out through store-within-store format and will run under CVS’s name. CVS/pharmacy will be in all of Target’s stores that provide pharmaceutical services.

Target clinics will also be rebranded with CVS/pharmacy’s name ‘MinuteClinic’ and it will further introduce 20 new pharmacies/clinics in different Target Stores after the deal is finalized. These clinics will likely come into being in a time span of three years. Larry Merlo, the CEO of CVS stated that the company is looking forward to serve Target customers for a better and healthy lifestyle, with their leading clinical programs, including Specialty Connect, Maintenance Choice, and Pharmacy Advisor.

Furthermore, the CEO stated that the company will leverage its business scale and will offer cost saving and convenience to customers and payers. Presently, CVS stock is being traded at $96.50 indicating an increase of 4.22%.