NovoCure (NAS:NVCR) Degree of Financial Leverage

: 0.76 (As of Sep. 2023)

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Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in Earnings Before Interest and Taxes (EBIT). NovoCure's Degree of Financial Leverage for the quarter that ended in Sep. 2023 was 0.76. The higher Degree of Financial Leverage, the more volatile earnings will be.

The industry rank for NovoCure's Degree of Financial Leverage or its related term are showing as below:

NVCR's Degree of Financial Leverage is ranked better than
63.91% of 834 companies
in the Medical Devices & Instruments industry
Industry Median: 0.98 vs NVCR: 0.76

NovoCure Degree of Financial Leverage Historical Data

The historical data trend for NovoCure's Degree of Financial Leverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

NovoCure Annual Data

Trend

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Degree of Financial Leverage

0.77

-0.56

1.67

0.93

NovoCure Quarterly Data
	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23
Degree of Financial Leverage																0.09	0.93	0.78	0.74	0.76

Competitive Comparison

For the Medical Devices subindustry, NovoCure's Degree of Financial Leverage, along with its competitors' market caps and Degree of Financial Leverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

NovoCure Degree of Financial Leverage Distribution

For the Medical Devices & Instruments industry and Healthcare sector, NovoCure's Degree of Financial Leverage distribution charts can be found below:

* The bar in red indicates where NovoCure's Degree of Financial Leverage falls into.

NovoCure Degree of Financial Leverage Calculation

NovoCure's Degree of Financial Leverage for the quarter that ended in Sep. 2023 is calculated as:

Degree of Financial Leverage	=	% Change in Earnings per Share (Diluted)^**	/	% Change in EBIT
	=	( -1.86 (Sep. 2023) / -0.77 (Sep. 2022) - 1 )	/	( -213.121 (Sep. 2023) / -74.245 (Sep. 2022) - 1 )
	=	1.4156	/	1.8705
	=	0.76^***

** TTM data of EPS and EBIT was used to calculate Degree of Financial Leverage.
*** Please be aware that the Degree of Financial Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.

NovoCure (NAS:NVCR) Degree of Financial Leverage Explanation

Degree of Financial Leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s Earnings per Share (EPS) to fluctuations in its operating income, also referred to as Earnings Before Interest and Taxes (EBIT), resulting from adjustments in its capital structure. DFL is an essential tool for companies to assess the appropriate level of debt or financial leverage in their capital structure. When EBIT remains relatively stable, it results in stable earnings and earnings per share. In such cases, the company may consider taking on substantial debt. However, for companies operating in industries with significant fluctuations in EBIT, it is advisable to keep debt at a manageable level.

The higher Degree of Financial Leverage, the more volatile earnings will be. Because interest is a fixed expense, leverage can amplify earnings and EPS. This is beneficial when EBIT is growing, but it can become problematic in tough economic conditions when EBIT is under pressure.

Be Aware

The use of financial leverage varies across different industries and business sectors, and the application of Degree of Financial Leverage (DFL) should be adjusted accordingly.

NovoCure Degree of Financial Leverage Related Terms

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NovoCure (NAS:NVCR) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » NovoCure Ltd (NAS:NVCR) » Definitions » Degree of Financial Leverage

Comparable Companies

Traded in Other Exchanges

NVCR:Mexico 038:Germany

Address

Grenville Street, No. 4 The Forum, Second Floor, St. Helier, JEY, JE2 4UF

Website

https://www.novocure.com

NovoCure Ltd serves in the healthcare sector of the United States. Its business involves the development, manufacture and commercialization of Tumor Treating Fields (TTFields) devices, including Optune and Optune Lua, for the treatment of solid tumor cancers. Its pipeline consists of Ovarian Cancer, Pancreatic Cancer, Non-Small Cell Lung Cancer, and Brain Metastasis. Products are comprised of two main components: electric field generator and arrays and related accessories. NovoCure derives its major revenues in the United States.

Executives

Arye Barak Ben	officer: General Counsel	TOPAZ BUILDING, 4TH FLOOR, MATAM CENTER, PO BOX 15022, SH'AR HACARMEL, HAIFA L3 31905
Timothy J Scannell	director	2825 AIRVIEW BOULEVARD, KALAMAZOO MI 49002
Kristin Stafford	director	1550 LIBERTY RIDGE DRIVE, SUITE 115, WAYNE PA 19087
Uri Weinberg	officer: Chief Innovation Officer	NOVOCURE INC., 20 VALLEY STREAM PARKWAY, SUITE 300, MALVERN PA 19355
Frank X Leonard	officer: President, CNS Cancers US	20 VALLEY STREAM PARKWAY,, SUITE 300, MALVERN PA 19355
Ashley Cordova	officer: Chief Financial Officer	20 VALLEY STREAM PARKWAY,, SUITE 300, MALVERN PA 19355
William Patrick Burke	officer: Chief Human Resources Officer	195 COMMERCE WAY, PORTSMOUTH NH 03801
Allyson J Ocean	director	1550 LIBERTY RIDGE DRIVE, SUITE 115, WAYNE PA 19087
Ely Benaim	officer: Chief Medical Officer	C/O REXAHN PHARMACEUTICALS, INC., 15245 SHADY GROVE ROAD, SUITE 455, ROCKVILLE MD 20850
Jeryl L Hilleman	director	C/O INTERSECT ENT, INC., 1555 ADAMS DRIVE, MENLO PARK CA 94025
Pritesh Shah	officer: Chief Commercial Officer	C/O NOVOCURE INC., 20 VALLEY STREAM PARKWAY, SUITE 300, MALVERN PA 19355
Sherilyn S Mccoy	director	JOHNSON & JOHNSON, ONE JOHNSON & JOHNSON PLAZA, NEW BRUNSWICK NJ 08933
David Hung	director	C/O AXOVANT SCIENCES, INC., 320 WEST 37TH STREET, 5TH FLOOR, NEW YORK NY 10018
Martin J. Madden	director	C/O MICROBOT MEDICAL INC., 175 DERBY STREET 27/1, HINGHAM MA 02043
Pomona Secondary Associates Vii Llc	10 percent owner	780 THIRD AVENUE, 46TH FLOOR, NEW YORK NY 10017