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I am bullish on Novo Nordisk due to its 62% global GLP-1 market share and dominant Ozempic sales, supporting long-term leadership. Novo Nordisk's diversified GLP-1 portfolio, including Rybelsus and pending pill versions, positions it well against competitors and broadens its addressable market. Consistent double-digit revenue and profit growth, plus strong Q2 2025 expectations, reflect robust demand and effective cost management.
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Healthcare stocks have lagged the S&P 500, with Novo Nordisk already hit hard by intense competition from Eli Lilly. Despite recent setbacks and a decelerating growth outlook, Novo Nordisk's valuation now reflects steep pessimism, suggesting the downside appears limited. Novo Nordisk's robust brand, R&D, and profit margins provide a significant moat, even as competition in the GLP-1 market intensifies.
Novo Nordisk holds 72% international and 50%+ U.S. market share in GLP-1 treatments, serving 46 million patients globally. Obesity drug sales surged 65% YoY in Q1-FY25, driving total revenue growth of 18% and free cash flow of $1.38 billion. The company projects FY25 free cash flow between $8.14–$9.59 billion, supported by 48.43% EBIT margins and expanding manufacturing capacity.
Novo Nordisk's Q1 2025 results were solid, but FY guidance was cut, suggesting a longer recovery. Large growth potential exists, with 85% of diabetes patients undertreated and obesity treatments under 1% market penetration. The company is investing heavily in expanding manufacturing capacity ($9B+ capex) to meet rising GLP-1 demand, while risks from US drug price cuts seem limited.
Wegovy and Ozempic drive 66% of NVO's Q1 revenues - investors eye Q2 sales ahead of results on Aug. 6.
NVO shares fall 19.9% year to date amid weak CagriSema data, CEO exit and rising pressure from rivals in obesity care.
Novo Nordisk (NVO) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
Novo Nordisk remains dominant in diabetes and obesity care, with strong growth and expanding market share despite recent investor concerns. The company's pipeline, especially the oral GLP-1 and Alzheimer's trial, offers significant long-term upside. The company needs to grow its top-line at mid-% to justify its current valuation. By assuming the market growth rate, the company is massively undervalued.
In the closing of the recent trading day, Novo Nordisk (NVO) stood at $71.01, denoting a +1.89% move from the preceding trading day.
Novo Nordisk is a global diabetes and weight loss leader with strong long-term growth prospects due to rising global demand and a robust pipeline. Recent stock weakness is overdone; valuation models show NVO trading at a significant discount, offering potential double-digit annual returns and dividend growth. The company's transition away from Hims & Hers and the upcoming oral Semaglutide launch position NVO for further market expansion and first-mover advantage.