Morningstar Advisor - April/May 2010 - 63

Sector Snapshot: Pharmaceuticals
The data shown on this page represent the pharmaceutical companies that are in Morningstar’s database. Specifically, it’s the companies in these industries: drug manufacturers, drugs generic, and biotechnology.

Sector Structure
Moat Breakdown* % Breakdown S&P 500

Key Stats
Aggregates

Industry Map
480 $1,864.13 billion $2,194.4 billion
31878.001953 25840.001465 19802.000977 13764.000488

Number of Companies Total Market Cap Total Fair Value Total Revenue
Valuation
6479.800293 5234.600220 3989.400146 2744.200073 1499.000000

Wide Moat Narrow Moat No Moat NA
Stock Type Breakdown

76.45% 10.14% 6.56% 6.85%

42.30% 44.80% 11.30% 1.60%

1 2 3 45 67 89 10 11 13 15 14

Market Cap 12 Large

$2,997.76 billion
7726.000000

Medium

Sector

S&P 500
1282.600037 1067.200027 851.800018 636.400009 421.000000 420 336 252 168 84 0

% Breakdown

S&P 500

High Yield Distressed Hard Asset Cyclical Slow Growth Classic Growth Aggressive Growth Speculative Growth Not Classified
*Based on Morningstar analyst coverage.

0.00% 1.89% 0.00% 0.00% 10.48% 6.71% 25.76% 3.91% 51.24%

0.00% 1.82% 12.81% 34.56% 13.94% 20.46% 13.07% 2.93% 0.41%

Price/Fair Value P/E Price/Book Price/Sales Price/Cash Flow Dividend Yield %
Profitability and Financial Health

0.84 11.48 40.25 166.70 10.15 2.28

0.91 14.36 2.03 1.21 3.61 3.37
Undervalued 0 .5 Price/Fair Value 1 Overvalued 1.5 2

Small

Sector

S&P 500

0.0 0.0

ROE % ROA % Net Margin % Debt to Capital %

18.33 7.17 –7.56 36.57

17.19 6.56 9.30 35.75

0.0

Pharmaceutical-sector companies are plotted based on their market cap and price/fair value ratio. Companies with a price/fair value ratio of less than 1 are undervalued. Companies with a ratio of more than 1 are overvalued. Numbered plots show companies listed in the “Pharmaceutical-Sector Companies” chart below.
0.5 1.0 1.5 2.0 0.5 1.0 1.5 2.0 0.0 0.5 1.0 1.5 2.0 0.5 1.0 1.5 2.0

H

R U

S
Economic Moat Growth Grade Profitability Grade Financial Distance Dividend Free Cash Health to Yield % Flow Grade Default Yield %

Notable Pharmaceutical-Sector Companies
Name/Ticker Market 3-Yr Total Cap ($mil) Rtrn % Revenue TTM ($mil) 3-Yr Rev/ Morningstar Share Rating Growth % Uncertainty Rating

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Roche Holding AG ADR RHHBY Johnson & Johnson JNJ Pfizer Inc. PFE Novartis AG ADR NVS Merck & Co., Inc. MRK GlaxoSmithKline PLC ADR GSK Sanofi-Aventis ADR SNY Abbott Laboratories ABT AstraZeneca PLC ADR AZN Teva Pharmaceutical Industries, Ltd. ADR TEVA Amgen, Inc. AMGN Bayer AG ADR BAYRY Novo Nordisk A/S ADR NVO Gilead Sciences, Inc. GILD Bristol-Myers Squibb Company BMY
Data as of Feb. 28, 2010

288,785.99 174,940.00 139,859.56 122,337.47 115,702.88 105,781.69 97,956.46 83,966.95 64,884.88 56,484.38 55,594.95 53,618.68 44,931.40 42,513.02 41,945.02

–0.55 47,904.00 2.85 60,528.00 2.49 42,306.00 –2.09 23,367.20 –8.35 27,184.00 –1.26 39,078.01 2.38 29,924.85 –3.56 32,052.00 19.84 12,945.00 –4.14 14,584.00 7.06 32,918.00 19.78 49,328.00 9.99 6,407.21 2.19 21,135.00

5.54 {{{{

Medium

Wide Wide Wide Wide Wide Wide Wide Wide Wide

X C C C C C C C X

X Z C C Z X C X Z V X X Z Z Z Z Z Z Z Z Z Z C Z V X

8.87 6.99 6.51 N/A 8.55 11.36 N/A 14.95 N/A 9.19 10.09 1.95 N/A N/A 10.20

3.33 3.08 3.81 3.69 4.09 5.18 3.87 2.96 5.13 0.88

4.81 8.12

5.10 {{{{{ Low 9.46 {{{{{ Low 6.61 {{{{ 3.91 {{{{ 0.24 {{{{ 9.68 {{{{ 18.24 {{{ 0.87 {{{ 10.05 {{ 10.57 {{{ 32.32 {{{ 2.91 {{{ Medium Medium Medium Medium Medium Medium High Medium High Medium

–6.08 45,818.00 111.12 {{{{{ Medium

11.00
8.42 1.67

5.45
7.06 7.37 7.25 4.70

11.03 {{{{{ Low

Narrow X Wide None Wide Wide
X C X

10.44
1.96 1.08 5.11 3.45 24.18 6.70 7.95

Narrow Z C

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Morningstar Advisor - April/May 2010

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