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Introduction & Thesis
My second ever article on Seeking Alpha was on Danish diabetes and weight loss drug leader Novo Nordisk (NVO)(OTCPK:NONOF) on March 30, 2025. Since then, it has underperformed the S&P 500 index by more
Novo Nordisk Has So Much Room To Go
Summary
- 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.
- Key risks include increasing regulatory scrutiny in Europe, rising competition from Eli Lilly, margin pressures, and uncertainties in the drug pipeline.
- Overall, NVO is a bargain and a strong buy.
Hi! I'm a passionate investor who has been researching publically traded companies for over 6 years. My primary focus is on identifying great businesses at reasonable prices and holding them for the long term but I also dive into trend following strategies from time to time. While I have a slight bias toward technology companies, I maintain a broad perspective, including opportunities in crypto. I take a global approach to investing, occasionally seeking value beyond the U.S. market. Thanks for reading!
Analyst’s Disclosure:I/we have a beneficial long position in the shares of 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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