Finance managers being CEO's-case of Novartis AG (Essay Sample)
Write a two page paper discussing what you find interesting about this company, and whether or not you think this company will have a successful future. Get to the company's web site, into the "investors relations" section and provide some financial highlights of your company for the past year. Indicate which stock exchange the company is listed on and what was the past 12 month rate of return (% gain or loss) to investors who bought shares of this company a year ago and sold the shares yesterday. This rate of return is called the one-year Holding Period Return, or HPR. Also state what is the most recent price of the shares on the company?
In addition discuss briefly some information about the top management team including the CEO and CFO. If there are any issues involved with the company that relate to the issues discussed in the case assignment, mention them briefly as well.source..
Finance mod 1 SLP: Finance managers being CEO’s-case of Novartis AG
I chose Novartis AG (NVS) a pharmaceutical company manufacturing drugs and other healthcare products listed and is listed the New York Stock Exchange (NYSE). Despite the company’s headquarters being in Switzerland, the company is a major player in the U.S. health care industry. There are numerous challenges in the drug manufacturing industry because of the cost implications and need to have employees with highly specialized skills in biotechnology. Even though, the big pharmaceutical companies are dominant they need to be more innovative as they patent their healthcare products, and there is a risk of loss in market share when the companies appear static.
As at July 10th 2015, the company’s stock was trading at $ 103.22, compared with a closing price of $ 89.81. On the other hand, the adjusted closing price taking into account the dividends and splits was $87.34 as at July 10th 2014 (Yahoo Finance, 2015). The resultant change in the stock price over the 1-year period is a 14.9% increase in the stock price between July 10th 2014 and 2015, while using the adjusted closing price the change is +18.1%. As a multinational company, the company’s stock performance is affected by the industry performance in the major markets as well as management changes in the parent company.
Joseph Jimenez is the CEO of Novartis AG (NVS), while Harry Kirsch the CFO is also a key executive in Novartis Ag. Both executives previously served as the CEO and CFO of the pharmaceuticals division of the company respectively, before their promotion to head the overall company. The CEO has a background in business administration, but the CFO studied industrial engineering and economics (Reuters, 2015). According to Picker (1989), CFOs who have broadened their knowledge outside their financial backgrounds are most likely to succeed as CEOs, given the need to deal with diverse issues and personalities as the overall head of an organization. CPAs are well placed to be CFOs as they work closely with CEOs and present financial...
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