Key Morningstar Metrics for Novo Nordisk
- : DKK 285Fair Value Estimate
- : ★★★Morningstar Rating
- : WideMorningstar Economic Moat Rating
- : HighMorningstar Uncertainty Rating
What We Thought of Novo Nordisk’s Earnings
Novo Nordisk NOVO B saw 6% adjusted revenue growth and 8% adjusted operating profit growth in the second quarter. Management raised its 2026 guidance at constant exchange rates for sales and operating profit to between flat and a 6% decline. Copenhagen shares fell 4% on Aug. 5.
Why it matters: Novo’s guidance raise looks like it accounts for strong results so far this year, but the company is heading into a more difficult second half, with generic semaglutide already launching in Brazil and Canada as well as increasing penetration of lower-priced, oral cash pay sales globally.
- Wegovy pill US and UK launches have been clear volume success stories this year but pull the firm’s overall obesity pricing lower. We think Medicare obesity drug access in the second half and Wegovy pill’s launch in Germany in September could drive growth, based on bullish capacity commentary.
- Novo also appears to be matching generic pricing with savings-card programs in Canada, a strategy that could help preserve revenue but weigh further on margins as generic access expands.
The bottom line: We are lowering our fair value estimate for wide-moat Novo Nordisk to DKK 285/USD 44 from DKK 311/USD 48 after reducing our long-term gross margin forecast and cagrisema sales expectations, as well as slightly lowering our stage 2 growth assumptions.
- Cagrisema’s disappointing results from the Reimagine 4 study (failed to show noninferiority to Mounjaro on blood glucose control) follow its failure against Zepbound on weight loss in the Redefine 4 study earlier this year, making the fight against Lilly’s entrenched product tougher.
- We now see gross margins settling in the mid-70s (down from our prior assumption of high 70s) given increased reliance on cheaper pill options in the cash-pay channel, which is further emphasized by injectable cagrisema’s disappointments. Shares look overvalued at recent prices.
