Novo Nordisk (NYSE:NVO)

Since 1923, Novo Nordisk has been committed to improving care for people with diabetes – and today is world leader in diabetes treatment. Its product range extends from modern insulin analogues, through traditional human insulins, an oral antidiabetic, to a large number of insulin delivery systems tailored to the needs of users, such as pens.

Novo Nordisk is also the pharmaceutical company that is preparing the largest number of research and development projects in the field of diabetes. Current projects deal with, for example, appetite regulation, insulin secretion, overload of insulin-producing beta cells, sugar production by the liver, insensitivity of the body's cells to insulin (insulin resistance) and lipid metabolism disorders.

THE average annual yield NVO is modest, with 1.66%. The price/earnings ratio confirms this unattractive valuation, with 19.80. On the other hand, there average annual dividend growth is impressive, with 33.24% and above all it is done in concert with that of profits. Thus, despite this spectacular increase, the distribution ratio remains particularly cautious, with only 36.06%.

This NVO strength nevertheless comes at a price for investors. In addition to the current high valuation, Volatility is extreme for this type of investment, with 27.11%The beta, with 1.66, indicates that NVO is particularly sensitive to market variations.

The price progression is impressive and almost interrupted since 1985. The difference compared to the S&P is particularly marked during the "lost" decade 2000-2010.

The title offers an interesting protection against fluctuations in the dollar (NVO is listed in New York but the company is Danish).

In conclusion, NVO may be of interest to an investor willing to take risks and who has a long-term investment horizon. With junk food becoming more and more widespread in both developed and developing countries, Diabetes unfortunately still has a bright future ahead of it.

NVO is a income booster which allows the dividends received from a given capital to be increased very quickly. The low distribution ratio and the potential growth in profits will undoubtedly allow for maintaining comfortable dividend growth in the future.

From our point of view, still a little cautious about high volatility stocks, we prefer to stay on the sidelines of NVO for the moment.