Since we left the market bottom in our rearview mirror in March
2009, you can't deny the momentum that has developed in economies
the world over. This is the primary reason that you should be
"going global" right now. All you need to do is look at the recent
trends in manufacturing around the world -- one of the most
important measures of growth.
In the end, the low interest rate policy at the Federal Reserve,
coupled with a weak dollar, a strong earnings environment, a
tremendous amount of cash earnings from equities and next-to-zero
returns for money market funds translates -- I believe -- to the US
stock market bringing us excellent long-term returns in the coming
In the more immediate term, there's booming growth to capture
abroad. Remember that a weaker dollar boosts the earnings of
multinational companies. And this is precisely why we have been
adding these stocks to our balanced portfolio of stocks over the
last several months. In fact, one great buy right now is
a global company fighting disease worldwide.
) combats illnesses on four fronts:
2. Vaccines and diagnostics
3. Generic drugs, and
4. Consumer health.
The company's pharmaceuticals division develops and manufactures
prescription drugs to treat a wide spectrum of ailments. Its
vaccine and diagnostics division manufactures vaccines and
blood-screening tools. Novartis's generics subsidiary, Sandoz,
produces generic drugs, as well as active pharmaceutical
The company's consumer health unit includes over-the-counter
medications, including Benefiber, Excedrin, and Theraflu, along
with CIBA Vision's contact lenses and eye care products. The
company also has an animal health companion unit and agricultural
animal care products.
In the fourth quarter, Novartis's earnings rose 53.3% to $2.3
billion, or $1.26 per share, compared with $1.5 billion in the same
quarter in 2008. During the same period, the company's sales rose
28% to $12.93 billion. Novartis' pharmaceutical sales grew a
healthy 21% to $7.8 billion, and its sales in its vaccines and
diagnostic division surged 182% to $1.4 billion, thanks in part to
sales of the H1N1 flu vaccine.
The analyst community had estimated earnings of $1.19 per share
and sales of $11.95 billion, so Novartis posted a 5.9% earnings
surprise and a whopping 8.2% sales surprise! For the first
quarter, the analyst community is estimating 21% annual sales
growth and 44.8% annual earnings growth.
So, the next time you reach for that bottle of Excedrin to
combat one of springtime's allergy headaches, remember to add some
shares of this conservative stock to your portfolio.
As of this writing, Louis Navellier was recommending Novartis
in his Blue Chip Growth newsletter.