Novo Nordisk ($NVO) has been one of the influential healthcare firms 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 12 months, signalling a serious shift in investor expectations. The query is easy: is that this the start of an extended decline, or the sort of reset that creates alternative for long-term buyers?
1. The Twist in Novo’s Journey
The turning level started in america, which accounts for 58 % of Novo Nordisk’s income. Progress expectations had been minimize a number of instances, Wegovy demand softened, and round a million Individuals 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, rising aggressive strain.
Pipeline updates added to the weak point. CagriSema delivered 22.7 % weight reduction, sturdy however beneath investor expectations, and the inventory dropped about 10 %. Just 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 received the bid with a decrease provide and regulators flagged consolidation considerations. The state of affairs cut up buyers between seeing strategic imaginative and prescient and seeing urgency.
2. Resetting the Playbook
Dealing with strain on development, pricing and provide, Novo Nordisk launched a broad strategic reset. The corporate minimize 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 possible close to 149 {dollars} by 2027. The aim is to develop entry and gradual the migration towards compounded alternate options.
On the identical time, Novo is investing greater than 9 billion {dollars} in 2025 to develop international manufacturing. This contains doubling U.S. manufacturing together with main expansions in Denmark, France, China and Brazil. Some provide tightness is anticipated by way of 2025 as amenities ramp up.
To assist this shift, Novo Nordisk can also 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, scientific growth and industrial 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% 12 months over 12 months, whereas working revenue grew 5% to DKK 95.9 billion. Weight problems care remained the strongest engine, with gross sales rising 41% at fixed alternate charges to DKK 59.9 billion. EBITDA reached DKK 112.3 billion, reflecting one of many highest profitability ranges within the international 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• value to gross sales round 4.3• value to e book round 8
Traditionally Novo Nordisk traded at a P/E between 22 and 27. The present valuation is due to this fact 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 might fall additional, however the decrease valuation additionally provides Novo room to outperform if situations begin to stabilize.
To shift sentiment the corporate might want to ship on three areas:
stabilisation of Wegovy demand• profitable growth into excessive quantity packages equivalent to 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, as we speak’s valuation could show overly pessimistic.
4. Will the Inventory Get well or Fall Additional?
The long run route of the share value will rely on a number of components, however the state of affairs is now extra outlined than earlier within the 12 months. The principle challenges, weaker US demand, stronger competitors and a narrowed full 12 months outlook are already recognized and mirrored within the share value. The main focus now shifts to how Novo Nordisk manages the subsequent stage.
What’s going to buyers look within the close to future:• updates on Wegovy demand in america• the size of compounded GLP 1 use• any changes to 2025 steerage
These areas nonetheless affect how rapidly efficiency within the US market can stabilize.
Trying additional forward, a number of milestones might form the medium time period outlook, though most of them fall in 2026 or later:
the launch of the oral weight problems drug• regulatory selections that have an effect on pricing or entry• growth into massive quantity packages equivalent to Medicare• new scientific information from pipeline candidates
Novo Nordisk ($NVO) stays a major international participant with sturdy monetary efficiency, however the setting round it has grow to be extra complicated. Competitors, pricing strain and regulatory components are more likely to proceed affecting the inventory as new info emerges. The general route is open, and the subsequent part will rely on firm execution and broader market situations.
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