Novo Nordisk ($NVO) has been one of the vital influential healthcare corporations because of its weight problems medicine Ozempic and Wegovy. These merchandise modified the burden loss business, drove explosive income development and briefly made Novo Nordisk Europe’s most beneficial firm. However 2025 has marked a pointy reversal. The inventory is down about 50 % for the yr, signalling a serious shift in investor expectations. The query is easy: is that this the start of a protracted decline, or the type of reset that creates alternative for long-term traders?
1. The Twist in Novo’s Journey
The turning level started in the USA, which accounts for 58 p.c of Novo Nordisk’s income. Progress expectations had been lower a number of instances, Wegovy demand softened, and round a million People shifted to cheaper compounded semaglutide, pulling significant quantity away. On the identical time, Eli Lilly expanded provide of Mounjaro and Zepbound and secured broader insurance coverage protection, growing aggressive strain.
Pipeline updates added to the weak spot. CagriSema delivered 22.7 % weight reduction, sturdy however beneath investor expectations, and the inventory dropped about 10 %. Lately, an Alzheimer’s trial failed, pushing shares to a four-year low and elevating questions on Novo’s pipeline outdoors GLP-1 medicines.
A management transition created additional uncertainty. New CEO Mike Doustdar tried a ten billion greenback takeover of Metsera, however Pfizer gained the bid with a decrease supply and regulators flagged consolidation considerations. The state of affairs break up traders between seeing strategic imaginative and prescient and seeing urgency.
2. Resetting the Playbook
Going through strain on development, pricing and provide, Novo Nordisk launched a broad strategic reset. The corporate lower out-of-pocket costs for Ozempic and Wegovy to 199 {dollars} for starter doses and 349 {dollars} month-to-month, with Medicare pricing set to drop towards 245 {dollars} and oral GLP-1 choices probably close to 149 {dollars} by 2027. The purpose is to develop entry and sluggish the migration towards compounded alternate options.
On the identical time, Novo is investing greater than 9 billion {dollars} in 2025 to develop world manufacturing. This consists of doubling U.S. manufacturing together with main expansions in Denmark, France, China and Brazil. Some provide tightness is predicted via 2025 as services ramp up.
To help this shift, Novo Nordisk can be restructuring. About 9,000 jobs (roughly 11 % of the workforce) might be eradicated, together with 5,000 roles in Denmark. Hiring continues in manufacturing, medical growth and business areas, whereas nonessential recruitment is frozen.
3. What the Numbers Reveal
Regardless of the challenges, Novo Nordisk continues to ship sturdy monetary efficiency. Within the first 9 months of 2025, gross sales reached DKK 229.9 billion, up 12% yr over yr, whereas working revenue grew 5% to DKK 95.9 billion. Weight problems care remained the strongest engine, with gross sales rising 41% at fixed trade charges to DKK 59.9 billion. EBITDA reached DKK 112.3 billion, reflecting one of many highest profitability ranges within the world pharmaceutical business.
What stands out most is the valuation reset. Novo Nordisk now trades at:
- P/E round 13
• ahead P/E round 12
• EV/EBITDA round 9
• worth to gross sales round 4.3
• worth to e book round 8
Traditionally Novo Nordisk traded at a P/E between 22 and 27. The present valuation is subsequently 40–50% beneath its long run common.
The market now not costs Novo Nordisk as a high-growth innovator and is now valuing it extra like a mature pharmaceutical firm. This shift cuts each methods. If development weakens once more, the inventory may fall additional, however the decrease valuation additionally provides Novo room to outperform if circumstances begin to stabilize.
To shift sentiment the corporate might want to ship on three areas:
- stabilisation of Wegovy demand
• profitable enlargement into excessive quantity applications reminiscent of Medicare, TrumpRx and decrease priced tiers
• a aggressive pipeline, particularly the oral weight problems drug anticipated in 2026 and future CagriSema growth
If these parts strengthen, at present’s valuation might show overly pessimistic.
4. Will the Inventory Get better or Fall Additional?
The longer term path of the share worth will depend upon a number of elements, however the state of affairs is now extra outlined than earlier within the yr. The principle challenges, weaker US demand, stronger competitors and a narrowed full yr outlook are already identified and mirrored within the share worth. The main target now shifts to how Novo Nordisk manages the subsequent stage.
What’s going to traders look within the close to future:
• updates on Wegovy demand in the USA
• the size of compounded GLP 1 use
• any changes to 2025 steerage
These areas nonetheless affect how shortly efficiency within the US market can stabilize.
Trying additional forward, a number of milestones may form the medium time period outlook, though most of them fall in 2026 or later:
- the launch of the oral weight problems drug
• regulatory choices that have an effect on pricing or entry
• enlargement into massive quantity applications reminiscent of Medicare
• new medical knowledge from pipeline candidates
Novo Nordisk ($NVO) stays a major world participant with sturdy monetary efficiency, however the atmosphere round it has grow to be extra advanced. Competitors, pricing strain and regulatory elements are more likely to proceed affecting the inventory as new data emerges. The general path is open, and the subsequent section will depend upon firm execution and broader market circumstances.
This communication is for data and schooling functions solely and shouldn’t be taken as funding recommendation, a private advice, or a proposal of, or solicitation to purchase or promote, any monetary devices. This materials has been ready with out considering any explicit recipient’s funding targets or monetary state of affairs and has not been ready in accordance with the authorized and regulatory necessities to advertise unbiased analysis. Any references to previous or future efficiency of a monetary instrument, index or a packaged funding product will not be, and shouldn’t be taken as, a dependable indicator of future outcomes. eToro makes no illustration and assumes no legal responsibility as to the accuracy or completeness of the content material of this publication.
