Ozempic's creator lowered forecasts for the fourth time this year. Should we sell the stock?

Pharmaceutical giant Novo Nordisk has lowered its revenue and operating profit forecast for 2025 for the fourth time this year. However, the company's shares rose more than 1.5% in trading on November 5. The company is going through a challenging period: it is already losing ground to US-based Eli Lilly in the market for obesity drugs, which it created. Analysts' opinions on Novo securities differ.

Danish pharmaceutical company Novo Nordisk A/S said that in 2025 revenue will grow by a maximum of 11% and operating profit by no more than 7% (at fixed exchange rates). The outlook has worsened: in July, the company expected sales growth of up to 14% in the best-case scenario and operating profit of 10%. This is the fourth time in a year when one of the world's leaders in the production of drugs for patients with diabetes, obesity and endocrine diseases lowered forecasts, writes Bloomberg.

The company attributed its decision to changes in the prescription sales dynamics of its key drugs Wegovy and Ozempic, increased competition and pricing pressures.

The revision of the forecast followed simultaneously with the publication of financial results for the third quarter, Bloomberg points out . The company's net profit for the quarter amounted to 20 billion Danish kroner ($3.1 billion): analysts, according to FactSet, expected 20.12 billion kroner, writes CNBC. Operating profit for the first nine months of 2025 increased 10% year-on-year to 95.9 billion kroner. Excluding restructuring costs of about 9 billion crowns, the growth would have been 21%, Novo said.

Novo Nordisk shares were up nearly 2.7% in Copenhagen trading on Nov. 5, but then slowed to about 1%. Novo Nordisk's American Depositary Receipts (ADRs) were also up more than 2% at one point in the U.S. premarket.

Novo Nordisk Novo is going through a difficult period: since the beginning of the year, the Copenhagen-based company's shares have fallen by more than 50%, sales growth has slowed, which has led to a change of CEO and reshuffling of the board of directors. The new head Mike Doustdar has already started a large-scale restructuring: about 11% of employees will be cut.

In addition, Novo is intensifying its fight with the US pharmaceutical company Eli Lilly in the market of obesity drugs. Morgan Stanley analysts note that the sales dynamics of Eli Lilly in major foreign markets are beginning to repeat the indicators in the U.S., writes Bloomberg. Last week Eli Lilly raised its own forecast and exceeded expectations for revenue in the third quarter.

Meanwhile, Novo Nordisk, which was the first to bring its weight-loss drugs Ozempic and Wegovy to the market, is losing ground. Last year, the company faced a setback: its new experimental injection turned out to be less effective in clinical trials than expected. Now the Danish manufacturer is betting on the tablet form of Wegovy, expecting to strengthen its position in the segment of drugs to combat obesity. The company is also bidding for biotech startup Metsera against U.S. rival Pfizer to strengthen its position in the market, Reuters writes .

Thanks to Wegovy's booming sales, Novo has become Europe's most valuable company in 2024: the company's market value peaked in June 2024, but has since fallen by around 70% - almost to the level of when Wegovy was launched in 2021.

Given the decline in the stock by more than 50%, analysts' opinions on Novo shares now diverge, writes CNBC. For example, Jefferies downgraded the securities to "below market", while Berenberg maintained a "buy" recommendation, saying that "Novo has reached the peak of uncertainty".

"Good growth rates and outstanding R&D results justify the company's higher valuation compared to its competitors," Berenberg said.

Most analysts recommend buying Novo Nordisk securities: they have 20 Buy and Overweight ratings out of 32 total, MarketWatch shows. Another ten analysts advise to hold the securities (Hold), two - to sell (Sell). The average target price of ADR at $68.12 implies their growth by 41%.

This article was AI-translated and verified by a human editor