NVO - Novo Nordisk: Outlook For Weight Loss Drugs In 2024

2024-01-22 09:15:00 ET

Summary

• Novo Nordisk's weight loss drug, Wegovy, earned $1.38 billion last quarter and is projected to share a large piece of the growing weight-loss drug market.
• Despite its market dominance, Novo faces challenges in affordability, competition (like Eli Lilly's Zepbound), and sustainable obesity treatments.
• Novo Nordisk's recent financial performance exceeds expectations, indicating strong market confidence and robust growth projections.
• Novo's market sentiment is robust, with strong growth prospects and positive momentum in the stock market.
• Recommendation: Maintain "Buy" on NVO stock; its dominance in obesity treatment and strategic innovations position it for long-term success despite potential short-term volatility.

Novo Nordisk At a Glance

Since my initial assessment and "Buy" recommendation of Novo Nordisk ( NVO ) in May, Novo's stock has nearly doubled the performance of the S&P 500 with a 31% return. Novo Nordisk weight loss drug, Wegovy , continues to rack up billions amidst substantial demand. Wegovy earned $1.38 billion last quarter, for a total of roughly $3.1 billion in the first nine months of '23. Importantly, Wegovy was recently discovered to reduce the risk of cardiovascular events (heart attack, stroke, and death), which is expected to spark increased interest and use. Following this discovery, J.P. Morgan analysts revised their market projections for GLP-1 medicines, including Wegovy and Eli Lilly's ( LLY ) Zepbound, from $34 billion to $71 billion by 2032. Novo is projected to share a large piece of that....

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