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Novartis AG (FRA:NOT) Forward PE Ratio Explanation
The Forward PE Ratio of a company is often used to compare current earnings to estimated future earnings, as well as gaining a clearer picture of what earnings will look like without charges and other accounting adjustments. If earnings are expected to grow in the future, the Forward PE Ratio will be lower than the current PE Ratio. This measure is also used to compare one company to another with a forward-looking focus.
Trailing PE Ratio relies on what is already done. It uses the current share price and divides by the total EPS (Basic) over the past 12 months. PE Ratio can be affected by Non Operating Income such as the sale of part of businesses. This may increase for the current year or quarter dramatically. But it cannot be repeated over and over. Therefore PE Ratio without NRI is a more accurate indication of valuation than PE Ratio .
Novartis AG Forward PE Ratio Related Terms
Novartis AG Forward PE Ratio Historical Data
* Premium members only.
The historical data trend for Novartis AG's Forward PE Ratio 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.
Novartis AG Forward PE Ratio Chart
Novartis AG Annual Data
Trend
2015-12
2016-12
2017-12
2018-12
2025-12
Forward PE Ratio
17.51
14.62
15.90
15.34
15.19
Novartis AG Quarterly Data
2015-12
2016-03
2016-06
2016-09
2016-12
2017-03
2017-06
2017-09
2017-12
2018-03
2018-06
2018-09
2018-12
2019-03
2019-06
2019-09
2025-06
2025-09
2025-12
2026-03
Forward PE Ratio
17.51
13.00
16.53
15.27
14.62
15.72
17.54
16.16
15.90
14.97
14.06
15.36
15.34
17.61
18.38
16.10
14.08
13.34
15.19
16.98
FRA:NOT vs LLY, JNJ, ABBV: Forward PE Ratio Comparison
For the Drug Manufacturers - General subindustry, Novartis AG's Forward PE Ratio, along with its competitors' market caps and Forward PE Ratio 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.
Novartis AG Forward PE Ratio vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Novartis AG's Forward PE Ratio distribution charts can be found below:
* The bar in red indicates where Novartis AG's Forward PE Ratio falls into.
It's a measure of the price-to-earnings ratio (PE Ratio) using forecasted earnings for the calculation. While the earnings used are just an estimate and are not as reliable as current earnings data, there is still benefit in estimated P/E analysis. The forecasted earnings used in the formula can either be for the next 12 months or for the next full-year fiscal period.
Novartis AG (FRA:NOT) has a Forward PE Ratio of 17.72 as of Jul. 15, 2026. Forward P/E ratio is the share price dividend by the expected per-share earnings in the next 12 months. View historical data on Novartis AG and its competitors. According to the industry distribution chart, Novartis AG ranks #213 out of 409 companies in the Drug Manufacturers industry, placing it in the top 52.1%.
Is Novartis AG's Forward PE Ratio too high?
Novartis AG's current Forward PE Ratio is 17.72. The Drug Manufacturers industry median Forward PE Ratio is 17.39. Novartis AG's value of 17.72 is 1.9% above this industry median. Based on the distribution chart, Novartis AG ranks #213 out of 409 companies in the Drug Manufacturers industry, which is below the industry midpoint. Overall, Novartis AG has a GF Score™ of 81/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Novartis AG's Forward PE Ratio compare to LLY and JNJ?
According to the Drug Manufacturers industry distribution chart, Novartis AG ranks #213 out of 409 companies for Forward PE Ratio. This places Novartis AG in the lower half of its industry. The industry median Forward PE Ratio is 17.39. Novartis AG's value of 17.72 is 1.9% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Forward PE Ratio for a Drug Manufacturers company?
The median Forward PE Ratio among Drug Manufacturers companies is 17.39, based on 409 companies in the industry. Companies in the top quartile (top 25%) have a Forward PE Ratio significantly above this median, while those in the bottom quartile fall well below. However, Forward PE Ratio should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Novartis AG's current Forward PE Ratio of 17.72 is 1.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Forward PE Ratio mean?
A high Forward PE Ratio can signal that a stock is expensive relative to its fundamentals. Forward P/E ratio is the share price dividend by the expected per-share earnings in the next 12 months. View historical data on Novartis AG and its competitors. For the Drug Manufacturers industry, the median Forward PE Ratio is 17.39 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Novartis AG's current Forward PE Ratio is 17.72. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Novartis AG stock overvalued right now?
Based on GuruFocus' analysis, Novartis AG (FRA:NOT) is currently considered Modestly Overvalued. The stock's GF Value™ is €113.18, compared to a current price of €133.72 — trading 18.1% above its estimated fair value. The current Forward PE Ratio is 17.72 and 1.9% above the Drug Manufacturers industry median of 17.39. Novartis AG's overall GF Score™ is 81/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Forward PE Ratio calculated?
Forward PE Ratio is calculated from a company's financial statements. For Novartis AG (FRA:NOT), the current Forward PE Ratio is 17.72 as of Jul. 15, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Novartis AG (FRA:NOT) Overvalued in 2026?
Based on GuruFocus' analysis, Novartis AG stock appears to be overvalued.
The current stock price of €133.72 is trading 18.1% above its estimated GF Value™ of €113.18.
GuruFocus considers Novartis AG to be Modestly Overvalued.
Key valuation signals for FRA:NOT:
Forward PE Ratio: 17.72
GF Value™: €113.18 vs. price of €133.72 (18.1% above fair value)
Industry Position: 1.9% above the Drug Manufacturers median (#213 of 409)
No single metric tells the full story. See the FRA:NOT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Novartis develops and manufactures innovative drugs. Key areas of drug development are oncology, immunology, neuroscience, respiratory, and cardiovascular, renal, and metabolic. It also has an established medicines business, which includes off-patent franchises. The company sells its products globally, with the United States constituting close to one-third of total revenue.
81GF Score
Get the complete analysis for FRA:NOT
Forward PE Ratio is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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