Will Novo Nordisk Rise Again or Keep Declining?

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Ah, Novo Nordisk (NVO), the darling of the Danish pharmaceutical scene two years back-turns out that high was short-lived, like a fleeting chat with a neighbor you can’t quite remember. They were boosting the local economy so well you could practically hear the Danes humming “We Will Rock You.” But fast forward just 18 months and they’ve taken a nose dive. Shares? Down 58%. It’s a classic tale of “You had one job!”

And yet, here we are, with potential catalysts lurking on the horizon like a long-lost friend wanting to borrow your lawnmower. Can Novo Nordisk turn it around? A good question, but let’s dive deeper before we commit to buying a few shares.

What happened to Novo Nordisk

So, in the first half of this year, they posted net sales of 154.9 billion Danish kroner ($24.4 billion). Not too shabby-up 15% from the same time last year. Essentially, if you squint just right, it looks like they’re pulling their weight. Almost all that coin came from diabetes and weight management products, so let’s give a solid nod to their stars: Ozempic and Wegovy. But, you see, when a company’s riding the wave of two or three key products, any hiccup feels a lot like a sneeze at a fancy dinner-everyone turns to look at you, and it’s awkward.

Their warning lights have been flashing, though. They lowered their 2025 guidance thanks to their GLP-1 medicines acting like they’ve lost their mojo. And let’s admit, competition is looming like an ex at a party; it’s uncomfortable, and you can’t help but watch, waiting for a misstep. Eli Lilly, their biggest rival, is flexing muscles with Zepbound, gathering momentum like a snowball rolling down a hill. You know what that means? Less love in the marketplace.

Novo Nordisk finds itself in quite the pickle. Sure, CagriSema showed promise in phase 3 trials, but when it wasn’t the slam dunk they expected, panic set in. Can we just say: Talk about a collective cringe!

Why the company can rebound

In the midst of this mishmash, they’ve decided to play defibrillator with their leadership, appointing Maziar Mike Doustdar as CEO-quite a decision, right? New blood, new ideas. And what’s he doing? Well, he’s shaking things up by striking new deals that could fuel growth-kind of like that friend who promises to not make plans without consulting you, then goes and arranges a surprise trip without telling you. It’s exciting but also deeply unsettling.

They licensed something wonderful called UBT251 from United Biotechnology for a cool $200 million upfront, plus potential bonuses of up to $1.8 billion. They say it’s a triple agonist, which is fancy talk for “it works on three fronts.” No drugs like this are approved for weight management, but if it performs, it could be a game-changer-like suddenly finding a parking spot right in front of your favorite coffee shop.

We’re talking a 15.1% weight loss in just 12 weeks during trials. That’s promising, yet I can already envision the inevitable follow-up meetings and the actual outcomes. “So, how’s that going to affect our bottom line?” you can hear the analysts say, eyes darting back and forth, all while trying not to trip over their words.

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And let’s not skip over the internal projects. Their amycretin is kicking off phase 3 studies, and guess what? They’re launching an oral version of semaglutide for weight loss. No GLP-1 pill approved yet, but boy, wouldn’t that be a hassle-free alternative to those needles? It’s like picking between taking the stairs or waiting for the elevator-everyone’s leaning toward the easy route.

On top of that, Wegovy just scored a label expansion for that obscure condition called metabolic dysfunction-associated steatohepatitis (MASH). Sounds like a bad rap album, but hey, it affects millions in the U.S. Now they’re in the game with something meaningful, and you can count on that to reflect in some spiffy results moving forward.

The price is right

Here’s the kicker: despite the hiccups, Novo Nordisk’s results remain pretty stellar. A 15% sales increase year over year in this dog-eat-dog world of pharmaceuticals? Impressive. Their earnings per share? Up 23% to 12.49 DKK ($2) this past half-year. And their forward price-to-earnings ratio? A delightful 13.1-lower than the healthcare average of 16.5. It’s like finding a great deal at the farmer’s market, amidst overpriced avocados.

So, with all that considered, despite facing headwinds tougher than a windy day by the beach, Novo Nordisk’s stock is still looking pretty sweet. Buying today could just be your best bet in the next five years-granted you don’t step on a rake or trip over a garden hose in the process. 🥴

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2025-09-20 14:43