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

MorningstarAdvisor.com 63


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Morningstar Advisor - April/May 2010

Table of Contents for the Digital Edition of Morningstar Advisor - April/May 2010

Morningstar Advisor - April/May 2010
Contents
New On MorningstarAdvisor.com
Contributors
Letter from the Editor
Our Job: Building Better Investors
What’s Your Biggest Long-term Concern for the Economy?
An Early Start
Women’s Work
Investment Briefs
Markowitz 2.0
Asset Allocation Is King
A Decade of Riskier Assets ...
... but with plenty of Silver Linings
Be Prepared
Facing up to the Economy’s Problems
Levelheaded
Surviving on Conviction
Four Picks for the Present
Pharmaceutical Firms Get the Urge to Merge
Funds That Look Cheaper Than the Market
Finding Dividend Leaders
Mutual Fund Analyst Picks
50 Most Popular ETFs
Undervalued Stocks with Wide Moats
VAs: Assets Rise as New Sales Slip
New at Morningstar
When You Wish Upon a Star
Morningstar Advisor - April/May 2010 - Morningstar Advisor - April/May 2010
Morningstar Advisor - April/May 2010 - Cover2
Morningstar Advisor - April/May 2010 - 1
Morningstar Advisor - April/May 2010 - 2
Morningstar Advisor - April/May 2010 - Contents
Morningstar Advisor - April/May 2010 - 4
Morningstar Advisor - April/May 2010 - 5
Morningstar Advisor - April/May 2010 - New On MorningstarAdvisor.com
Morningstar Advisor - April/May 2010 - 7
Morningstar Advisor - April/May 2010 - Contributors
Morningstar Advisor - April/May 2010 - Letter from the Editor
Morningstar Advisor - April/May 2010 - 10
Morningstar Advisor - April/May 2010 - Our Job: Building Better Investors
Morningstar Advisor - April/May 2010 - 12
Morningstar Advisor - April/May 2010 - 13
Morningstar Advisor - April/May 2010 - What’s Your Biggest Long-term Concern for the Economy?
Morningstar Advisor - April/May 2010 - 15
Morningstar Advisor - April/May 2010 - An Early Start
Morningstar Advisor - April/May 2010 - 17
Morningstar Advisor - April/May 2010 - Women’s Work
Morningstar Advisor - April/May 2010 - 19
Morningstar Advisor - April/May 2010 - Investment Briefs
Morningstar Advisor - April/May 2010 - 21
Morningstar Advisor - April/May 2010 - Markowitz 2.0
Morningstar Advisor - April/May 2010 - 23
Morningstar Advisor - April/May 2010 - 24
Morningstar Advisor - April/May 2010 - 25
Morningstar Advisor - April/May 2010 - 26
Morningstar Advisor - April/May 2010 - 27
Morningstar Advisor - April/May 2010 - Asset Allocation Is King
Morningstar Advisor - April/May 2010 - 29
Morningstar Advisor - April/May 2010 - 30
Morningstar Advisor - April/May 2010 - 31
Morningstar Advisor - April/May 2010 - 32
Morningstar Advisor - April/May 2010 - 33
Morningstar Advisor - April/May 2010 - A Decade of Riskier Assets ...
Morningstar Advisor - April/May 2010 - ... but with plenty of Silver Linings
Morningstar Advisor - April/May 2010 - 36
Morningstar Advisor - April/May 2010 - Be Prepared
Morningstar Advisor - April/May 2010 - 38
Morningstar Advisor - April/May 2010 - 39
Morningstar Advisor - April/May 2010 - 40
Morningstar Advisor - April/May 2010 - 41
Morningstar Advisor - April/May 2010 - 42
Morningstar Advisor - April/May 2010 - 43
Morningstar Advisor - April/May 2010 - Facing up to the Economy’s Problems
Morningstar Advisor - April/May 2010 - 45
Morningstar Advisor - April/May 2010 - 46
Morningstar Advisor - April/May 2010 - 47
Morningstar Advisor - April/May 2010 - 48
Morningstar Advisor - April/May 2010 - 49
Morningstar Advisor - April/May 2010 - Levelheaded
Morningstar Advisor - April/May 2010 - 51
Morningstar Advisor - April/May 2010 - 52
Morningstar Advisor - April/May 2010 - 53
Morningstar Advisor - April/May 2010 - Surviving on Conviction
Morningstar Advisor - April/May 2010 - 55
Morningstar Advisor - April/May 2010 - 56
Morningstar Advisor - April/May 2010 - 57
Morningstar Advisor - April/May 2010 - Four Picks for the Present
Morningstar Advisor - April/May 2010 - 59
Morningstar Advisor - April/May 2010 - 60
Morningstar Advisor - April/May 2010 - Pharmaceutical Firms Get the Urge to Merge
Morningstar Advisor - April/May 2010 - 62
Morningstar Advisor - April/May 2010 - 63
Morningstar Advisor - April/May 2010 - Funds That Look Cheaper Than the Market
Morningstar Advisor - April/May 2010 - 65
Morningstar Advisor - April/May 2010 - Finding Dividend Leaders
Morningstar Advisor - April/May 2010 - 67
Morningstar Advisor - April/May 2010 - Mutual Fund Analyst Picks
Morningstar Advisor - April/May 2010 - 69
Morningstar Advisor - April/May 2010 - 70
Morningstar Advisor - April/May 2010 - 71
Morningstar Advisor - April/May 2010 - 50 Most Popular ETFs
Morningstar Advisor - April/May 2010 - 73
Morningstar Advisor - April/May 2010 - Undervalued Stocks with Wide Moats
Morningstar Advisor - April/May 2010 - 75
Morningstar Advisor - April/May 2010 - VAs: Assets Rise as New Sales Slip
Morningstar Advisor - April/May 2010 - 77
Morningstar Advisor - April/May 2010 - 78
Morningstar Advisor - April/May 2010 - New at Morningstar
Morningstar Advisor - April/May 2010 - When You Wish Upon a Star
Morningstar Advisor - April/May 2010 - Cover3
Morningstar Advisor - April/May 2010 - Cover4
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