Novocure Ltd (NVCR)
Valuation Overview•Is Novocure Ltd Overvalued or Undervalued?
The market is pricing the stock in line with historical averages, assuming steady-state growth.
Fragile underlying quality score of 41/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
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Verdict: Average quality business weighed down by significant profitability concerns.
Wall Street is highly bullish, projecting significant upside with steady expected earnings growth. The company currently dilutes shareholders to fund operations and growth rather than returning capital.
NVCR struggles with subpar profitability and pressured margins. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (6.8% 3Y CAGR) paired with stable bottom-line earnings. However, profitability remains a major concern with severely compressed operating margins (-22.1%).
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $183.6M | +8.3% | +6.8% | +5.8% | +34.8% | |
| EBITDA | -$10.6M | — | -20.1% | — | — | |
| Net Income | -$15.7M | +19.2% | -13.8% | — | -2.0% | |
| EPS (Diluted) | $-0.13 | +21.8% | — | — | +0.9% | |
| Free Cash Flow | $5.5M | -9.3% | — | — | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 76.1% | 75.6% | 76.8% | 71.8% |
| Operating Margin | -22.1% | -32.5% | -24.5% | -29.1% |
| Net Margin | -21.2% | -29.8% | -23.5% | -33.5% |
| FCF Margin | -3.0% | -14.2% | -6.0% | -18.6% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q3'26Latest | $-0.33 | $-0.13 | +60.8% | ||
| Q2'26 | $-0.51 | $-0.62 | -21.0% | ||
| Q1'26 | $-0.41 | $-0.22 | +46.3% | ||
| Q4'25 | $-0.42 | $-0.33 | +21.4% | ||
| Q3'25 | $-0.39 | $-0.36 | +7.7% | ||
| Q2'25 | $-0.47 | $-0.31 | +34.0% | ||
| Q1'25 | $-0.34 | $-0.61 | -79.4% | ||
| Q4'24 | $-0.34 | $-0.28 | +17.6% |
Total return is +25.0% (1Y), outperforming the benchmark by +9.2%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +23.9% | +11.5% | — |
| 1Y | +25.0% | +9.2% | — |
| 3YCAGR | -2.1% | -22.4% | — |
| 5YCAGR | -34.1% | -45.4% | — |
| 10YCAGR | +5.9% | -7.4% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Novocure Ltd (NVCR) valuation, health, and returns.
Novocure Ltd is estimated to be fair under our discounted cash flow framework. trading near fair value (DCF: $18.24)
Novocure Ltd has multiple valuation anchors: DCF Intrinsic Value: $18.24 | Wall Street Analyst Target: $26.00 (implying +60.0% upside). A convergence of these signals offers higher conviction.
Novocure Ltd displays fair financial health with a composite quality score of 41/100, supported by a Altman Z-Score of 0.7 (distress zone), Piotroski F-Score of 5/9, Return on Invested Capital (ROIC) of -16.4%.
Novocure Ltd does not return material capital to shareholders via dividends or share repurchases, electing to retain earnings to fund internal growth.
Novocure Ltd's current growth trajectory is Stable. The company achieved +8.3% 1Y revenue growth and +21.8% 1Y EPS growth, compared to its 3Y revenue CAGR of +6.8%.
Wall Street consensus is Buy based on 15 analysts, beating EPS expectations in 83% of recent quarters with a 1-quarter streak. The consensus price target represents a +60.0% change from current levels.
Investment risks for Novocure Ltd include: -32.5% 1-year max drawdown, high beta (1.60x market volatility), elevated distress risk. Volatility risk is characterized by a beta of 1.60x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.