Analyst Note
| Damien Conover, CFA |Novartis reported first-quarter results slightly below our projections, but we don’t expect any major change to our fair value estimate. We continue to view the stock as fairly valued, with the late-stage pipeline and currently marketed portfolio offsetting patent losses over the next several years. We project close to 2% annual sales growth over the next five years with some margin improvement driving faster earnings growth. This solid midterm outlook combined with a strong early and mid-stage pipeline help reinforce the firm’s wide moat rating.