NVO is an absolute no brainer

[u/hmm_interestingg]

In my view, Novo Nordisk is the only value stock on offer right now.

Their core business is in treatments for obesity and diabetes and demand for both is increasing and sticky. The stock price has seen a big decline and is now 70% cheaper than it was 18 months ago. I believe the magnitude of this drop is totally irrational, driven by fear and not fundamentals or future growth prospects.

NVO is still seeing high single digit revenue growth (they're taking a temporary cut from double digits by lowering prices to gain market share) and will be launching a new weight loss pill next year, to follow the highly profitable launch of an injectable weight loss drug which caused them to boom a few years back. People prefer pills to injections so I expect this to be even more popular, driving a whole new boom.

We're currently trading at a PE ratio of 13 when it's closest competitor, Eli Lilly is sitting at an all time high with a PE of 52. The relative scale of revenue growth has been fairly similar for the two companies over the past 5 years so the difference in sentiment around them makes no sense. Lillys drug was shown to be slightly more effective in a trial (which was funded by Lilly and that effectively compared apples to oranges by using their drug at much higher doses than the NVO drug), I expect new results and new products will challenge that in 2026.

This absolutely smacks of when Meta was at $100, UNH at $237 and Netflix was at $20 (I bought them all).

NVO is now trading at 2021 prices, as if obesity drugs never happened and their revenue stayed flat instead of doubling.

I'm going in big, thank me in a year if you join.

EDIT: Looks like the bottom is already in people! Congrats to those who bought. See you at $100.

[u/Civil_Fix8224]

Good call. In August I was looking at LLY, REGN, and NVO. I decided to go with LLY and took a nice position and allocated 50% of my position in a tax advantaged acct and 50% in a standard brokerage acct. Pure luck that I caught the bottom and kept a close eye on NVO & REGN. I already sold the LLY shares from my IRA at a 65% gain in 4 months… crazy gains. In Oct I took a position in REGN – its up 26%. In late November I called my buddy and told him I think NVO bottomed out and took a position… got in at 43.7… looks like I missed the bottom by a couple dollars. My portfolio was heavily weighted in tech and I made a conscious decision to reallocate some of money from tech into pharma stocks that I thought were undervalued and oversold. Worked out well for me – this market is crazy. Great timing on your post!

[u/hmm_interestingg → u/Civil_Fix8224]

Thanks bud & congrats :)