Novo
Nordisk
(NOVO
B)
released
earnings
on
Wednesday.
Here’s
what
our
analysts
thought
of
the
results
Wide-Moat
Novo
Nordisk
reported
36%
full-year
constant
currency
sales
growth
for
the
full
year
2023,
ahead
of
our
expectations
and
those
of
consensus,
although
operating
income
growth
of
44%
was
in
line
with
our
estimates,
and
we’re
maintaining
our
DKK
540
(£61.82)
Fair
Value
Estimate.
The
sales
outperformance
was
driven
by
52%
growth
in
the
firm’s
GLP-1
diabetes
sales
(largely
Ozempic),
despite
GLP-1
obesity
sales
growth
of
154%
(largely
Wegovy)
which
was
slightly
below
investors’
already
sky-high
expectations.
Key
Data
Coming
on
Next-Gen
Obesity
Drugs
We
still
forecast
a
$170
billion
global
GLP-1
market
by
2031,
with
$120
billion
of
this
from
obesity/
overweight
and
most
of
the
market
relatively
evenly
split
between
Novo
and
Lilly.
We
expect
to
see
key
data
on
next-generation
obesity
drug
candidates
this
year
that
could
help
diversify
away
from
the
semaglutide
molecule
and
support
Novo’s
wide
economic
moat.
In
2024,
we
expect
prescribing
labels
for
semaglutide
to
extend
beyond
basic
indications
in
diabetes
(where
it
is
approved
as
Ozempic
and
Rybelsus)
and
obesity
(as
Wegovy),
with
cardiovascular
benefits
poised
to
be
added
after
the
clear
benefit
in
the
Select
trial.
Recent
positive
data
in
heart
failure,
kidney
disease,
and
knee
osteoarthritis
is
also
encouraging,
and
we
expect
additional
data
in
liver
disease
(end
of
2024)
and
Alzheimer’s
(2025)
could
further
boost
the
drug’s
midterm
potential.
With
roughly
three
quarters
of
Novo’s
sales
now
tied
to
GLP-1
therapies
and
potential
Medicare
negotiation
(2028)
and
the
semaglutide
patent
loss
(2032)
coming
into
focus,
Novo
is
rightly
focused
on
next-generation
cardometabolic
drug
candidates.
Key
Morningstar
Metrics
for
Novo
Nordisk
Shares
• Fair
Value
Estimate:
540
DKK;
• Last
close:
774,80
DKK;
• Morningstar
Rating:
2
stars;
• Morningstar
Economic
Moat
Rating:
Wide;
• Morningstar
Uncertainty
Rating:
High.
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