For a lot of traders, the pounds loss drug boom has boosted Danish pharmaceutical big Novo Nordisk ‘s appeal this calendar year — but just one financial investment bank has reservations. “Above the coming yr, we envisage sentiment to change, most likely originally as a final result of the launch of competitor Eli Lilly ‘s anti-being overweight drug Zepbound and the danger of disappointment from slower than predicted Wegovy source ramp-up,” Jefferies’ analysts led by Peter Welford wrote in a Dec. 7 equity analysis observe. Eli Lilly’s Zepbound, its tirzepatide bodyweight-decline drug, been given acceptance from the U.S. Foods and Administration (Food and drug administration) for fat reduction in early November. Novo Nordisk, for its section, introduced in the very same month that its Wegovy pounds-loss drug could obtain expanded approval from the Food and drug administration within 6 months . Other pharmaceutical companies like AstraZeneca and Pfizer are also developing bodyweight-decline drugs. Jefferies thinks the concentrate could change from Novo Nordisk “to other anti-being overweight drugs in the competitive landscape, with early/mid-phase data in 2024 expected from [over] 10 competing medications in growth.” Year-to-date shares in Novo Nordisk were up all around 40% to 661 Danish krone ($95.58) on Dec. 12. NOVOB-CH YTD mountain 12 months-to-day shares in Novo Nordisk Jefferies is underweight on the stock — naming it as one particular of the “underperformers” of 2024. The investment decision lender has a concentrate on rate of 430 Danish krone on the drug manufacturer— supplying it all around 36% downside. “We argue present multiples presently replicate extraordinary growth, income beats and sizeable assert on current market share. Shorter time period, we envisage product danger of sentiment modify all over the inventory as target shifts to competitor readouts and drug launches,” the analysts wrote. Bullish phone calls Financial commitment lender BofA, however, is bullish on Novo Nordisk, offering it a purchase rating at a price tag goal of 875 Danish krone in its Dec. 6 note, representing 32.4% upside potential. The bank’s analysts like the stock many thanks to the robust profits compound annual expansion price of close to 11% among 2025 and 2028, pushed in component by the start of Wegovy. BofA expects the firm’s “earnings updates cycle to go on” in 2024, next its “share rate outperformance in the last 18 months.” Citi is also favourable on the inventory, providing it a goal selling price of 815 Danish krone, or all-around 24% upside. “Novo proceeds to supply materially better advancement and returns ( > 3x pharma peers) and provides earnings visibility over and above 2035. We see the GLP-1 market place continuing to be dominated by [Novo/Eli Lilly],” the financial commitment bank’s analysts wrote in a Dec. 8 flash be aware. “Wegovy instructions a 92% share of the GLP-1 being overweight market place. Around 80% of organization will come from individuals having to pay a $25 regular monthly co-pay out, with hard cash-pay back symbolizing 5-10% Rx (health-related prescriptions),” they additional. Some 500,000 people today in the U.S. presently consider Wegovy and the enterprise stands to attain from an addressable client inhabitants of additional than 100 million in the U.S. and 700 million globally, the analysts mentioned. Of the 28 analysts masking the stock, 16 have a buy or obese ranking with an normal price concentrate on of 729.49 Danish krone, in accordance to FactSet. — CNBC’s Michael Bloom contributed to this report.
