Novo Nordisk Shares Fall on Disappointing Q2 Earnings

Shares of pharmaceutical giant slide after presenting a weaker-than-expected net profit while trimming its operating profit outlook. 

Johanna Englundh 7 August, 2024 | 9:46AM
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Shares in Danish pharmaceutical giant Novo Nordisk (NOVO B) fell on Wednesday as it reported net profit at 20,05 billion DKK in second quarter, below forecasts. A LSEG aggregate forecast had projected the figure would come in at 20,9 billion Danish kroner, whereas Bloomberg consensus was at 22,6 billion DKK. 

The company's stock price slid to 864 DKK, a loss of nearly 3%, having been down nearly 7% in early trading.

Earnings before interest and tax also came in below the forecasts at 25,93 billion DKK compared to 26,86 billion DKK for LSEG and 27,36 for Bloomberg. 

Additionally, Novo Nordisk trimmed its operating profit outlook for full-year 2024, saying growth was now anticipated to come in between 20% and 28%, rather than the previously expected 22% to 30% range. 

Key Morningstar Metrics for Novo Nordisk

 • Fair Value Estimate: DKK 600
• Morningstar Rating: 2 stars
• Economic Moat: Wide
• Morningstar Uncertainty Rating: High

Weight Loss Drugs Miss Forecasts

"The performance is borderline in line with expectations, but the composition is disappointing with both Wegovy and Ozempic significantly missing estimates. This was offset by the better-than-expected performance of Rybelsus but also older drugs like Victoza or Saxenda. The product mix is not what we anticipated to say the least", Stifel wrote in an analyst note.

Despite the trimmed profit outlook, Novo Nordisk raised its sales growth expectations again on Wednesday, now forecasting a growth of 22% to 28% at constant exchange rates for the full year 2024, up from the previous estimate of 19% to 27%. 

"While the Wegovy 'miss' will grab short term attention we note volume trends are strengthening with the body of evidence to support growing GLP-1 use is increasing", Citi states in an analyst comment. 

 

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Novo Nordisk A/S Class B764.90 DKK-1.94Rating

About Author

Johanna Englundh  Johanna Englundh is an editor for Morningstar in Sweden 

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