Novo Nordisk is set to release its first quarter 2026 earnings report on May 6. Here’s Morningstar’s take on what to look for in Novo Nordisk’s earnings and the outlook for its stock.
Key Morningstar Metrics for Novo Nordisk
- Fair Value Estimate: DKK 343.00
- Morningstar Rating: ★★★★
- Economic Moat: Wide
- Morningstar Uncertainty Rating: High
Novo Nordisk Earnings Release Date
- Wednesday, May 6, 07:30 CEST
What to Watch for in Novo’s Q1 Earnings
- Oral obesity drug face-off: With Novo’s Wegovy pill off to a strong launch in the US starting in January, and Lilly’s Foundayo just launching in April, we’re expecting both drugs to generate more than $1 billion in US sales this year in obesity alone, with additional sales for Novo’s longstanding Ozempic pill (Rybelsus) as well as potential approval later this year for Foundayo in diabetes. The drugs are similarly priced, with Wegovy pill perhaps slightly cheaper for some patients at the higher doses, and we think the Wegovy pill looks slightly more effective on weight loss as well. However, some food/water restrictions tied to taking Wegovy pill could make Foundayo easier to take for some patients, and we think Lilly has the edge in expanding supply to international markets, due to easier manufacturing of Foundayo (as a small molecule). We’re watching for any signs from Novo’s management that they can supply the Wegovy pill beyond the US market in a significant way.
- Expecting Q1 to reflect deeply discounted US GLP-1 prices and start of a price reset year, although some government sales could begin to contribute to growth by 2027. We think the Wegovy pill’s growth is one of the few bright spots in an otherwise tough 2026 for Novo, as we model sales declines for most of the rest of Novo’s portfolio. This is tied to both the GLP-1 US price reset starting last November as well as growing international competition across diabetes and obesity from Lilly’s Mounjaro/Zepbound. We’re looking for additional commentary from management on improved access to GLP-1 therapies in obesity across Medicare and Medicaid, and we think this could contribute to a return to growth beginning in 2027.
- Cagrisema and zenagamtide updates could help improve sentiment for performance beyond 2026. With cagrisema poised for a 2027 launch and zenagamtide potentially launching by 2029, Novo does have new products that could gain significant traction ahead of the 2032 semaglutide patent expiration across the US and European markets. However, cagrisema data hasn’t been able to match Zepbound’s profile, making Novo more reliant on zenagamtide and earlier-stage programs with limited public data so far.
- Market expectations are still quite low, and shares trade at a discount to our valuation. We think momentum has pulled Novo’s valuation down too far, with too little credit being given to the firm’s innovation and pipeline opportunities. We’re particularly interested in mid-stage pipeline updates and any upcoming bolt-on M&A deals, as following Novo’s failed bid for Metsera, it’s clear the firm is still looking for ways to improve its cardiometabolic pipeline in the long run with both internal and external sources of innovation.
Fair Value Estimate for Novo Nordisk Stock
With its 4-star rating, we believe Novo Nordisk’s stock is undervalued compared with our long-term fair value estimate of DKK 343 per share. After declines in 2026 and 2027, we expect Novo’s top line to resume mid-single digit growth, on average, through 2031. We assume US prices for Novo’s semaglutide could fall by over 20% in 2026, on average, ahead of our prior pricing pressure assumption for Ozempic and Rybelsus, which begin in 2027, and well ahead of their 2032 patent expirations.
Read more about Novo Nordisk’s fair value estimate.
Economic Moat Rating
We assign Novo Nordisk a wide economic moat rating, stemming from its strong intangible assets in diabetes and related cardiometabolic diseases like obesity.
A focused research and development strategy allows the firm to repeatedly extend patent protection through innovation. Efficient manufacturing techniques and economies of scale have allowed Novo’s insulin business to provide strong global profitability, qualities that it shares with the only two other global insulin players, Sanofi and Eli Lilly. However, we don’t think Novo’s cost advantages are strong enough to stand as a moat source for the entire firm, given that Novo’s foundation has rapidly shifted from insulin (17% of 2025 sales) to GLP-1 therapies (76% of 2025 sales).
Read more about Novo Nordisk’s economic moat.
Financial Strength
We assign Novo Nordisk an Exemplary Capital Allocation Rating, reflecting our belief that Novo possesses a sound balance sheet, exceptional investments outlook, and appropriate shareholder distributions.
As of the end of 2025, Novo held roughly DKK 130 billion in borrowings against DKK 26 billion in cash and equivalents. Historically, Novo has held low debt levels, but it has used debt to finance acquisitions like Emisphere (delivery technology) in 2020, Dicerna (RNAi technology) in 2021, and Catalent sites (manufacturing) in 2024. With strong free cash flows, Novo is in a solid position to continue investing in its internal and externally acquired pipeline and distributing cash via dividends and share repurchases.
Read more about Novo Nordisk’s financial strength.
Risk and Uncertainty
We assign Novo Nordisk a High Uncertainty Rating as price pressure and growing reliance on the high-growth GLP-1 class add volatility to potential cash flows.
Strong competition from Eli Lilly as well as potential competition from other biopharma firms adds pressure on Novo to continue to innovate in the cardiometabolic space. In addition, unauthorized compounded versions of semaglutide remain on the US market after the May 2025 deadline; it is unclear how long they will be available to patients before enforcement from regulators or litigation.
Read more about Novo Nordisk’s risk and uncertainty.
Novo Nordisk Bulls Say
- Novo’s Wegovy and Wegovy pill are expanding the obesity treatment market with strong efficacy and convenience, and are poised to remain key drugs until patent expiration in 2032.
- With a portfolio of older GLP-1 products, including injectable Ozempic and oral Rybelsus, as well as a pipeline of newer products like cagrisema and amycretin, Novo is well positioned to defend its formidable diabetes market share.
- Semaglutide could see significant sales potential in obesity-adjacent markets like liver disease (MASH), and Novo could achieve a strong share in these nascent markets.
Novo Nordisk Bears Say
- Tresiba’s strong profile in the long-acting insulin market hasn’t been enough to defend it from US pricing pressure due to competition from Sanofi and Lilly, and biosimilar insulins have weighed on category pricing since 2017.
- Novo’s Victoza and Ozempic have made GLP-1 a key part of the firm’s diabetes growth, but oral GLP-1 Rybelsus has had slower uptake, and Lilly’s Mounjaro provides strong competition.
- Wegovy had a slow launch due to supply constraints, and Zepbound, Lilly’s obesity drug, has a superior profile.
This article was compiled by Johanna Englundh.
