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I have been covering Novo Nordisk A/S (NVO) regularly and as I have been a shareholder for many years, this is probably not surprising. But from time to time, I am also looking at Novo Nordisk's major competitor Eli Lilly and
Investment Case For Eli Lilly Still Weak, Despite Novo Nordisk's Struggle
Summary
- Eli Lilly's growth is impressive, driven by Mounjaro and Zepbound, but its current valuation is only justifiable with sustained high growth.
- Despite strong results and superior products, Eli Lilly is not a buy at current prices; I rate it a Hold due to valuation risks.
- Novo Nordisk offers similar growth prospects but trades at a much more attractive valuation, making it the better investment opportunity now.
- While Eli Lilly is fairly valued after recent declines, Novo Nordisk is potentially undervalued by 35% and presents less downside risk.
My analysis is focused on high-quality companies, that can outperform the market over the long-run due to a competitive advantage (economic moat) and high levels of defensibility. Focused on European and North American companies, but without constraints regarding market capitalization (from large cap to small cap companies).My academic background is in sociology and I hold a Master’s Degree in Sociology (with main emphasis on organizational and economic sociology) and a Bachelor’s Degree in Sociology and History.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of CVS, NVO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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