Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.
What we think about Novo Nordisk’s revenue
Novo Nordisk New b A constant currency sales growth of 18% was reported in the first quarter, with the midpoint of the 2025 currency sales growth guidance down from 20% to 17%. As reported in Denmark’s Cloner, management is currently viewing foreign exchange fluctuations as a headwind in 2025.
Why it matters: The market closely monitors Novo’s ability to maintain solid double-digit GLP-1 growth despite both branded competition (Eli Lilly) and unbranded combined versions of US products.
• First quarter growth was primarily due to disappointing sales of obesity drug Wegovy in the face of brand competition. However, the bounty period of the massive complex ends on May 22nd, and we expect the competition to disappear in the second half.
•NOVO aims to address the decline in combined supply by improving access to products for self-paying patients (with collaboration between the NOVOCARE website and telehealth companies) and the subsidized patient (WeGovy will be the exclusive CVS National Formulary option starting July 1st).
Conclusion: The disappointing first quarter results are expected to be balanced against unexpected growth in the second half, so we maintain a $89 fair value estimate for Widemote NOVO. Stocks are undervalued.
•While exposure to potential pharma-specific tariffs remains a risk, Novo believes that the expansion of US manufacturing facilities (a period of uncertainty in tariffs) only means short-term pressure on margins.
Longview: Oral GLP-1 drugs for obesity are the next wave of innovation, with Novo in a solid position and I think it will be possible to launch oral semaglutide for obesity in 2026.
• Lilly’s Orforglipron is cheaper to manufacture and could reach the global market more rapidly, but the drug has much limited long-term safety data and could be about a year after the launch of Novo in the US.
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