Novo
Nordisk
(NOVO
B),
Europe’s
largest
company
by
market
capitalisation,
reported
earnings
on
May
2.
The
Danish
pharmaceutical
giant
saw
demand
continue
to
rise
for
its
weight-loss
drugs,
Ozempic
and
Wegovy,
reporting
first
quarter
earnings
above
analyst’s
estimates.
The
drugmaker’s
quarterly
net
profit
was
25.41
billion
Danish
kroner
(€3.35
billion),
up
from
19.81
billion
kroner
a
year
ago.
Sales
of
Ozempic
and
Wegovy
increased
25%
year
on
year,
and
sales
in
the
company’s
North
American
operations
rose
34%,
helped
by
longer-lasting
insulins.
The
drugmaker’s
operating
profit
was
+9%
vs
consensus
(+3%
vs
UBS
estimates).
“The
beat
reflects
stronger
sales
and
the
fact
consensus
was
forecasting
a
much
stronger
increase
in
SG&A
[sales
and
general
expenses]
for
1Q
whereas
this
came
in
more
in-line
with
UBSe.
The
beat
vs
UBSe
is
driven
entirely
by
the
stronger
US
sales,”
UBS
analysts
wrote
in
a
comment
following
the
earnings
report
adding
that
they
view
this
as
“more
a
low
quality
beat
given
we
know
the
performance
of
US
prescription
volumes.”
Key
Morningstar
Metrics
for
Novo
Nordisk
Stock
•
Fair
Value
Estimate:
570
DKK
•
Morningstar
Rating:
1
star
•
Morningstar
Economic
Moat
Rating:
Wide
•
Morningstar
Uncertainty
Rating:
High
Novo
Nordisk
Upgrades
Outlook
for
2024
Looking
ahead,
Novo
Nordisk
also
updated
its
2024
outlook,
now
anticipating
sales
growth
between
19-27%,
at
constant
exchange
rates,
slightly
up
from
its
previous
projection
of
18%
to
26%.
The
company
also
increased
its
guidance
for
operating
profit
growth
by
one
percentage
point
in
both
ends
to
22-30%
at
constant
exchange
rates.
“The
guidance
upgrade
reflects
the
benefit
of
the
gross-to-net
price
adjustments
in
1Q,
with
the
business
and
capacity
expansion
in-line
with
company
expectations,”
UBS
analysts
wrote.
Obesity
Drugs
–
Prices
Fall,
Competition
Rises
Despite
beating
consensus
and
increasing
guidance
for
sales
growth
and
operating
profit
growth
slightly,
Novo
Nordisk’s
share
price
initially
fell
4.5%,
but
recovered
to
-2%
in
the
afternoon.
Lower
prices
for
Wegovy
could
be
responsible
for
the
shares
trading
lower.
Indeed,
sales
of
this
drug
rose
by
as
much
as
86%
to
8.2
billion
DKK,
but
on
a
conference
call
with
reporters
Novo
Nordisk
chief
financial
officer
Karsten
Munk
Knudsen
said
that
prices
of
the
products
were
“slightly
down”
last
quarter
and
that
the
company
expects
them
to
continue
to
decline
this
year,
according
to
Reuters.
Wegovy
and
Ozempic’s
main
competitor
in
the
US
marketplace
is
Eli
Lilly’s
(LLY)
tirzepatide,
which
is
marketed
for
weight
loss
as
Zepbound
and
for
diabetes
as
Mounjaro.
The
US
pharmaceutical
giant
reported
their
earnings
on
Wednesday,
with
figures
revealing
high
demand
for
competitor
Zepbound.
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