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Opinions Charles Lannon
Novo-NordiskNVOCOMMENTJan 28, 2014
Charles LannonStock price when the opinion was issued
As of Jun 18, 2026. Market Open.
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A personal holding since 1995. Their weight-loss drug is the big news now. Remember that after this hype, we'll see if there are any long-term side effects (i.e. the stomach). It's an unproven drug, but could be fine. Meanwhile, they grow their dividend 12% annually. He took profits, because shares ran up so fast. Have the highest R&D to revenues among pharmas. A long-term hold.
David DriscollNovo and Eli Lilly have both run up, but there's still more room to go, given the strong demand for their weight-loss drug. Insurers will probably pay for these drugs, because without them consumers couldn't afford them. Sure, others are developing their own drugs, but it's not easy. Pfizer just announced it's giving up.
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Premium contentYou've seen the ads, heard the hype about NVO's Ozempic (and its related Wegovy). As noted above, weight-loss drugs are all the rage, and NVO has attracted as much hype as Taylor Swift's latest album. In mid-October, the Danish company raised full-year guidance in sales and operating profit for the third time this year. NZO expects sales growth of 32-38% up from the prior 27-33%, based on surging popularity for both its drugs in the U.S.
Global leader. Recently became Europe's most valuable company by market cap. Diabetes and obesity drugs. Weight loss drug data showing positive cardiac effects as well. Raised guidance to 38% sales growth this year, with operating profit near 46% on the top end. Obesity treatment projected to move from 1M to 48M users by 2030.
Share price above its moving averages, beating S&P, 25% earnings growth rate forecast. Yield is 0.89%.
Stan WongThe largest company in Scandinavia. There is and will be lots of competition in weight-loss drugs. NVO has made a fortune through this drug, but their margins will shrink over time as competitors come. If you own this already, take profits, but don't expect NVO to double again.
Good job marketing Ozempic, taking the US and other countries by storm. Could be a $100B drug class for all participants. Significant weight loss, kidney and heart benefits. Always going to be side effects. Because of its runup, start with a 1/2 position, and then add on any weakness.
He strongly disagrees with some analysts who say that the new weight-loss drugs won't move the needles of their company stocks. He expects huge demand for these drugs to battle diabetes, which would prevent many other diseases. He sees a lot of runway ahead for LLY and Novo Nordisk.
Headquartered in Denmark it is the leading global health care company with $32 billion in revenue expected in 2023 and estimates keep growing. It was recently crowned as Europe's most valuable company by market cap. It is the clear leader in diabetes care and obesity drug treatments and produces 50% of the world's insulin. Expected sales growth is 38% this year with operating profit growth of 46%. EPS growth is 25% going forward.
Buy 4 Hold 1 Sell 1
Stan Wong
Diabetes is not going away. Obesity has made its latest drug popular. Have to ask what are the side effects? Trading at 34-35x forward PE, with a 25%+ growth rate. PEG of 1.6x is not cheap, but not expensive. Overbought. He'd like to see it at the 50- or 200-day MA, around $170-175.
Lost an Express Scripts (ESRX-Q) contract for its synthetic insulin medicine because of price. Although that is a headwind, it is not material. Has a very broad base of profits and sells its products throughout North America and Europe. Also likes that manufacturing insulin is almost a craft, which means it is much more resistance to generics in the long-term. Not necessarily cheap at about 20X trailing earnings, but it’s a business that has pretty strong visibility into decent high single digit top line growth and much better operating profit growth for the next few years. Have done a great job of returning cash to shareholders through buybacks and dividend increases.