Novo Nordisk – Slimming Down Its Share Price. Is It a Future-Proof Investment? [Guide]

Novo Nordisk was until recently one of the largest success story on the European stock exchange. The company is currently experiencing significant declines, which increases uncertainty among investors. Today's article will answer the following questions:

• What caused such fluctuations in the share price of this large pharmaceutical company?
• Has Novo Nordisk's competitive advantage expired?
• What future do analysts see for the company in the coming years?

Novo Nordisk – it's not just Ozempic

The company is currently known mainly for its weight loss drugs. Ozempic. However, it has a much broader product portfolio, which has allowed this Danish company to become one of the most important companies in the global pharmaceutical market. This is due to the fact that Novo Nordisk has been developing products to combat diabetes i obesityThis has led to the development of many groundbreaking drugs that help millions of diabetics with their daily lives. Novo

Nordisk is a true pioneer in the diabetes treatment market. According to Morningstar data, the company has over 30% of the share in the diabetes therapy market and half of the share in the insulin marketBoth markets have a combined value of approximately 95 billion USDIt's worth remembering that diabetes is a lifestyle disease, and the number of patients with this condition will likely increase in the coming years. This trend is beneficial for the company and will ensure the coming decades of solid revenues and profits. Of course, due to patent expirations, Novo Nordisk must constantly allocate significant resources to research and development to introduce ever-new drugs and stay ahead of the competition. Currently, there is a growing shift from insulin to modern insulin analogues, such as NovoLog from Novo Nordisk. In addition, other solutions from the company have also appeared on the market, such as Tresiba or Fiasp (mealtime insulin).

Despite competition from American and Chinese companies, the Danish company has very good prospects in this market. However, it's worth remembering that it may come under pressure from the American side, as President Donald Trump is increasingly vocal about the need to lower drug prices, which could negatively impact Novo's revenue and profit growth. More than half of its revenue comes from the American market.

But it's true growth stories it came mainly from therapy GLP-1 drugs, which belong to victoza, Rybelsus and the most important: OzempicThis drug became a sales hit not because it cured diabetes, but because it aided weight loss. It's an open secret that this type of medication was used e.g.Movie stars and millionaires alike. Over time, less affluent individuals also began using this type of therapy. Of course, there are many concerns about the long-term effects of using the drugs by people who don't have diabetes. However, people looking to lose weight quickly often turn to GLP-1 drugs. The sales hit translated into a huge increase in revenues and profits. As a result, the stock price skyrocketed, reaching a peak in 2024. Currently, the price has fallen sharply, shocking many investors who expected profits and revenues to grow above 20% annually. Until recently, Novo was the clear leader in the GLP-1 market, which is estimated at around $40 billion, but the problem is increasingly fierce competition. This also shocked management, which expects single-digit revenue growth in the coming years.

What caused the dynamic decline in Novo's price?

In the last few quarters, Novo's stock price has fallen by dozens of percent, likely shocking many who held the stock "for decades to come." What caused such rapid declines? After all, no drug has yet been invented that can cure diabetes with a single pill. Diabetes therapies continue to generate solid revenues and profits. The main problem has become a product that was a real hit not long ago: Ozempic.

Previously, the problem with this drug was that demand far exceeded supply, preventing the company from achieving significant sales due to insufficient production capacity. The current challenge is increasingly fierce competition. Eli Lilly introduced the preparation Mounjaro in 2022, but only recently has it started to chip away at Ozempic's share. This was due to the Eli Lilly product providing significantly greater weight loss (21% vs 15% Ozepic)The final straw in December 2024 was the news that the results of tests on a new drug CagiSema were disappointing and provided a similar weight reduction to Mounjaro, while the market was expecting the next-generation drug to regain its leadership position. The price drop was devastating, the share price fell 27% in one day.

Another very negative announcement came in July 2025. At that time, the management board decided to lower its revenue growth forecast for 2025 from 13%-21% to 8%-14%. This came as a significant surprise to investors, as it meant the management board saw significant challenges in maintaining market share in the GLP-1 drug segment. Unsurprisingly, the company also reduced its profit growth forecast from 16%-24% to 10%-16%. The share price fell by more than 20%Moreover, there are reports that Eli Lilly is working on an oral drug that acts like GLP-1. This also poses a significant challenge for Novo, as it would potentially create a drug that would be easier for consumers to take.

Forecasts for the coming years and the current valuation of the company

Currently, one share is valued at DKK 367, meaning the company is valued at 14,7 times its expected earnings for 2025. This valuation suggests that the market is concerned about whether the company will be able to maintain its revenue and profit growth rate in the coming years.

However, let's take a look at the analysts' forecasts. They expect earnings per share in 2028 to reach DKK 34,7, which is at the current price. C / Z ratio 28' at 10,6, which is a fairly reasonable level. If the company can grow at an annual rate of 8-10% in the coming years, a more reasonable valuation of around 15 times earnings seems to be appropriate. This would result in a 2028 valuation of around DKK 520, almost 42% higher than the current level. If the company manages to defend its market position and grows above 10% annually, a valuation of 20 times net earnings should not be surprising. In this case, the target level in 2028 would be DKK 694. Profit growth is possible if the company manages to introduce new drugs that are more effective and help Novo regain its leadership in the weight loss market.

Of course, this is a positive scenario, as it could turn out that the Trump administration will launch a war on pharmaceutical companies, which could result in lower margins generated in the lucrative US market. Reported profits in subsequent years will certainly be lower than in the above forecast. Analysts are divided on the company's forecasts for the coming year. UBS forecasts a valuation of DKK 340, while Deutsche Bank, for example, forecasts DKK 600.

Where to buy shares of Novo Nordisk and its competitors?

More and more brokers are offering access to a broad market and a huge number of equity instruments, including shares of Novo Nordisk and its direct competitors.

For example on XTB Today we can find over 11 equity instruments and 400 ETFs, Saxo Bank over 19 companies and 000 ETF funds, incl Exante as many as 50 shares and 000 ETFs.

Broker
Country	Poland	Denmark	Cyprus
Number of exchanges on offer	16 exchanges	37 exchanges	50 exchanges
Number of shares in the offer	approx. 7000 - shares circa 2200 - CFDs on shares	19 - shares 8 - CFDs on shares	50 - shares
The amount of ETF on offer	approx. 1700 - ETF approx. 200 - CFD on ETF	3000 - ETF 675 - CFD on ETF	10 - ETF
Commission	0% commission up to EUR 100 turnover / month	according to the price list + 250 EUR discount from Forex Club	according to the price list
Min. Deposit	0 PLN (recommended min. PLN 2000 or USD 500, EUR)	0 PLN / 0 EUR / 0 USD	10 000 EUR
Tool	xStation	SaxoTrader	Exante platform
	REVIEW	REVIEW	REVIEW
	CREATE AN ACCOUNT	CREATE AN ACCOUNT	CREATE AN ACCOUNT

CFDs are complex instruments and involve a high risk of a quick loss of cash due to leverage. 69-80% of retail investor accounts lose money when trading CFDs with this CFD provider. Consider whether you understand how CFDs work and whether you can afford the high risk of losing your money.

Investing is risky and you may lose some or all of your invested capital. The information provided is for informational and educational purposes only and does not constitute any type of financial advice or investment recommendation.

Is Novo Nordisk a bargain or a value trap?

Novo Nordisk has the potential to grow revenues and profits for decades to come. This stems from the fact that civilizational changes have led to a growing percentage of the population suffering from diabetes and obesity. This will translate into an increase in market value, which could help scale the business. In an optimistic scenario, the Danish company can be expected to maintain its market share in this dynamically developing market. This could then lead to double-digit earnings per share growth over the next few years.

A value trap would occur if Novo lost market share in both the GLP-1 and diabetes therapy markets. At this point, this is particularly difficult to imagine in the latter market. Of course, many drugs will lose patent protection in the coming years, but Novo is working on new drugs that will help it maintain its leadership position. Another potential threat is the potential reform of the US healthcare system, which would translate into lower revenues from drug sales in this market.

The situation in the GLP-1 market is much worse, as it is highly competitive, and the Danish company currently lacks a sustainable competitive advantage. Therefore, there is a certain probability of a pessimistic scenario, which would mean a significant slowdown in revenue and profit growth.

Looking objectively, in the medium and long term, Novo Nordisk presents itself as a quite attractively valued company that has the potential to grow in revenues and profits over the next few years.