Key Takeaways
- Investors will be watching sales of Novo’s oral weight-loss drug, which beat expectations in the previous quarter.
- Negative top-line growth amid US price headwinds and continued diabetes share losses make this a likely “trough” year, says Morningstar analyst Karen Andersen.
- Novo shares are flat so far in 2026, having recovered from a five-year low in March.
Novo Nordisk NOVO B will release its second-quarter 2026 earnings on Aug. 5. The Danish pharmaceutical giant’s recently launched obesity pill will be squarely in focus as investors look for further signs of recovery following a slew of setbacks in recent years, including manufacturing bottlenecks, disappointing trial results, and weak financial performance.
Sales of Novo’s oral weight loss drug, the Wegovy pill, smashed past expectations in the first quarter, the first since the treatment’s January launch. Morningstar director Karen Andersen describes the drug as a “bright spot” in an otherwise challenging period. Investors will be looking closely to see how sales stack up against rival Eli Lilly’s slower-to-market competitor, Foundayo, launched in April.
“Wegovy’s brand and strong efficacy should allow it to remain very competitive in the US, while Lilly could have the edge internationally due to sheer supply,” says Andersen. “However, with Wegovy pill’s recent approval in Europe, we’re hoping for more commentary from management on their ability to launch more aggressively beyond the US and UK.”
Key Morningstar Metrics for Novo Nordisk
- Fair Value Estimate: DKK 311
- Morningstar Rating: ★★★
- Morningstar Economic Moat Rating: Wide
- Morningstar Uncertainty Rating: High
A ‘Trough’ Year for the Drugmaker
Solid first-quarter Wegovy pill sales prompted Novo to raise its annual profit guidance, yet it continues to forecast a contraction of between 4% and 12% on a currency-adjusted basis this year.
Beyond the pill, Andersen says it is looking like a “trough” year for the stock, with negative top-line growth amid US price headwinds and continued diabetes share losses.
Sales of Novo’s injectable Wegovy obesity drug climbed in the first quarter, while those of its Ozempic diabetes drug waned amid continued competition from Lilly’s Mounjaro and Zepbound therapies. Novo and Lilly remain wrapped in a fierce battle for market share in the lucrative weight-loss segment, with the latter having surpassed Novo in sales of its injectables in the critical US market.
Elsewhere, a reduction in US GLP-1 pricing under a cash-pay price agreement with the Trump administration has added pressure to Novo’s US revenue. However, Andersen thinks investors should look out for signs that lower prices are unlocking new demand in the cash-pay market and Medicare markets. “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,” she says.
New Drugs Pipeline in Focus
With Novo’s semaglutide GLP-1, the basis of Wegovy and Ozempic, facing US patent expiry in the early 2030s, updates on the firm’s pipeline of new-generation obesity drugs will also be key.
“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,” Andersen says.
Meanwhile, following the pharma giant’s failed bid for obesity biotech Metsera, investors should keep an eye out for any upcoming bolt-on M&A deals, with the firm likely looking for ways to improve its long-term cardiometabolic pipeline, according to Andersen.
Novo Shares Fairly Valued
Novo shares are flat so far in 2026, having recovered from a five-year low in March. Nevertheless, the stock continues to trade at less than one-third of its June 2024 peak, when it held the title of Europe’s most valuable company.
Earlier this month, Andersen lowered her fair value estimate for the stock to 311 Danish kroner per share, bringing it in line with the current price. She says expectations are now “appropriately low” and shares look relatively fairly valued.
