Novo shares hits 9-month low as 2025 guidance underwhelms
By Danilo Masoni
MILAN, Nov 7 (Reuters) -Danish drugmaker Novo Nordisk's NOVOb.CO shares hit an over 9-month low on Thursday after surging more than 8% the previous day, as underwhelming guidance for next year overshadowed strong sales growth for its popular Wegovy weight-loss drug.
The two-day move saw Europe's biggest company by market cap trade in a wide 14-percentage-point range from low to high. By 1018 GMT, the stock was down 3% in Copenhagen < .OMXC20> after earlier falling 5.5% to its lowest since January.
In an analyst call on Wednesday, following a quarterly release that eased concerns that demand for Wegowy was slowing, Novo's finance chief Karsten Munk Knudsen said sales growth next year could be in the high percentage teens.
Barclays said commentary on 2025 weighed on the shares.
"We had a call back with IR and the moving parts seem to indicate (at least what we know now) a midpoint for FY25 top line a touch lower than current company consensus," Emily Field, analyst at the UK bank, wrote in a note, affirming her overweight rating on the stock.
The company will formally guide for 2025 in February.
Gilles Guibout, head of European equity strategies at AXA Investment Managers in Paris, said the sharp moves in Novo's shares were probably due to hedge fund action.
"Novo Nordisk is a widely held stock. Its market has significant potential. However, it's easier to find sellers than buyers for the stock, as everyone already holds plenty of it," he said.
"It's a stock that needs to be normalised. At the beginning of the year, there was too much hype around it," he added.
Novo Nordisk shares are up around 4% so far this year, but they have fallen almost 30% from the record high set in June.
The stock trades at a 27 times its expected earnings, a 22% premium to its 20-year average valuation, according to LSEG Datastream data. It is worth around $470 billion.
Novo PE https://tmsnrt.rs/3UIGEBH
Reporting by Danilo Masoni; Editing by Amanda Cooper
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
