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Novo Nordisk (CPSE:NOVO B): Revisiting Valuation After Recent Share Price Reset

Simply Wall St · 01/05 02:24

Novo Nordisk (CPSE:NOVO B) has been quietly grinding higher, with the stock up around 7% over the past month, even after a weaker stretch in the past 3 months and year.

See our latest analysis for Novo Nordisk.

That recent 6.7% one month share price return looks more like a short term reset than a full trend change, given the 1 year total shareholder return of minus 45.1% and 5 year total shareholder return still up 67.2%. This suggests long term believers have been rewarded even as momentum has cooled.

If Novo Nordisk has you revisiting opportunities in healthcare, it might be worth exploring other healthcare stocks that are starting to show improving momentum and fundamentals.

With earnings still growing, the share price well below analyst targets, and our estimates pointing to a sizable intrinsic discount, the key question now is whether Novo Nordisk remains attractively valued or if the market already reflects its next leg of growth.

Most Popular Narrative: 16% Undervalued

With Novo Nordisk last closing at DKK 330.25 against a narrative fair value near DKK 393.04, the story leans toward a discounted long term cash machine.

Analysts expect earnings to reach DKK 142.5 billion (and earnings per share of DKK 32.15) by about September 2028, up from DKK 111.1 billion today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting DKK 161.8 billion in earnings, and the most bearish expecting DKK 113.8 billion.

Read the complete narrative.

Curious how steady mid single digit revenue growth, firmer margins and a richer future earnings multiple can still justify upside from here? The full narrative unpacks the earnings path, the cash flow trajectory and the valuation bridge that turns today’s price into that higher fair value.

Result: Fair Value of $393.04 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, several risks could derail that upside, including intensifying price pressure on GLP 1 therapies and earlier-than-expected generic competition in key markets.

Find out about the key risks to this Novo Nordisk narrative.

Build Your Own Novo Nordisk Narrative

If you want to stress test these assumptions yourself and challenge the consensus view, you can build a complete narrative in just a few minutes: Do it your way.

A great starting point for your Novo Nordisk research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.