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NVO’s Earnings Surprise History <\/p>\n
Novo Nordisk has an impeccable performance history over the trailing four quarters, with earnings beating estimates each time. On average, Novo Nordisk registered an earnings surprise of 16.86% in the trailing four quarters. In the last reported quarter, the company reported an earnings surprise of 19.54%. <\/p>\n
Image Source: Zacks Investment Research <\/p>\n What Does Our Model Say? <\/p>\n Per our proven model, companies with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) have a good chance of delivering an earnings beat, which is not the case for NVO, as you will see below. You can uncover the best stocks to buy or sell before they’re reported with our\u00a0Earnings ESP Filter. <\/p>\n Novo Nordisk has an Earnings ESP of 0.00% and a Zacks Rank #5 (Strong Sell) at present. <\/p>\n You can see\u00a0the complete list of today’s Zacks #1 Rank stocks here. <\/p>\n Factors Shaping NVO’s Upcoming Results <\/p>\n Novo Nordisk operates under two segments \u2014 Diabetes and Obesity Care and Rare disease. <\/p>\n Novo Nordisk’s second-quarter revenues are expected to have been driven by sales of its diabetes and obesity treatments, particularly semaglutide-based (GLP-1) drugs \u2014 Ozempic (for type II diabetes [T2D]) and Wegovy (for obesity). <\/p>\n Since launch, Novo Nordisk has steadily expanded the commercial opportunity for both Ozempic and Wegovy through multiple label expansions. Investors will be most interested in the sales numbers for these two drugs when Novo Nordisk reports second-quarter 2026 results. <\/p>\n Novo Nordisk has also broadened its oral semaglutide franchise. Following the FDA approval of the oral Wegovy pill to treat obesity and reduce cardiovascular risk in late December, the drug was launched in the United States in early January, offering a more convenient alternative to injections. The pill has already surpassed three million prescriptions since launch, indicating strong early uptake. Earlier this month, oral Wegovy also received approval in the EU, setting the stage for additional sales growth in the coming quarters. <\/p>\n Beyond obesity, Novo Nordisk is strengthening its diabetes portfolio with oral semaglutide. In May, the FDA approved oral Ozempic for adults with T2D and to reduce cardiovascular risk. The drug was subsequently launched in the United States, likely contributing to second-quarter sales, which the investors will be keen to learn. The company also continues to generate meaningful revenues from Rybelsus, its oral semaglutide therapy for T2D. <\/p>\n However, Novo Nordisk’s weak 2026 outlook, expecting a decline in adjusted sales and operating profit, signals limited near-term momentum for its GLP-1 franchise, suggesting that second-quarter sales growth for Wegovy and Ozempic is likely to have remained under pressure amid intensifying competition from arch-rival Eli Lilly LLY. Pricing pressure in the United States, weaker prescription trends for injectable GLP-1 drugs, higher operating expenses and intensifying competition continue to create significant operational and executional hurdles. <\/p>\n Beyond its GLP-1 franchise, Novo Nordisk’s insulin and Rare Disease portfolios are likely to have provided additional support to overall revenues during the period. <\/p>\n NVO’s Stock Price & Valuation <\/p>\n Year to date, Novo Nordisk shares have lost 7.4% against the industry’s 10% growth. The company has also underperformed the sector and the S&P 500 during the same time frame, as seen in the chart below. <\/p>\n NVO Stock Underperforms the Industry, Sector & the S&P 500 Image Source: Zacks Investment Research <\/p>\n Novo Nordisk is trading at a discount to the industry, as seen in the chart below. Going by the price\/earnings ratio, the company’s shares currently trade at 14.19 forward earnings, which is lower than 18.51 for the industry. The stock is trading much below its five-year mean of 29.25. <\/p>\n NVO Stock’s Valuation Image Source: Zacks Investment Research <\/p>\n NVO’s Investment Thesis <\/p>\n Novo Nordiskhas achieved tremendous commercial success with Wegovy and Ozempic injections since their launch. However, the company’s growth trajectory has suffered in the past year. <\/p>\n The biggest challenge facing Novo Nordisk is the rapid ascent of Eli Lilly in the obesity market. Competition in the obesity treatment space has intensified significantly over the past year, driven by the vast, still-underpenetrated market opportunity. Lilly has emerged as Novo Nordisk’s strongest rival in the diabetes and obesity markets with its tirzepatide-based therapies \u2014 Mounjaro for T2D and Zepbound for obesity \u2014 which compete directly with Novo Nordisk’s Ozempic and Wegovy, respectively. Despite launching later, Mounjaro and Zepbound have rapidly gained market share in both indications, emerging as Lilly’s primary growth drivers while increasing competitive pressure on Novo Nordisk. <\/p>\n LLY also secured FDA approval and subsequently launched its oral GLP-1 pill, Foundayo (orforglipron), for obesity in early April, which now competes directly with Novo Nordisk’s Wegovy pill. Investors will be most keen on learning the initial commercial performance of Foundayo when Eli Lilly reports its second-quarter results on Aug. 5 as well. Both NVO and LLY have introduced multiple price cuts in response to pressure from the U.S. government during 2025 and 2026 to improve patient access to GLP-1 medicines. <\/p>\n Smaller biotech firms, like\u00a0Viking Therapeutics\u00a0VKTX and Structure Therapeutics\u00a0GPCR, are also advancing GLP-1\u2013based therapies to challenge the incumbents. Viking Therapeutics’ dual GIPR\/GLP-1 receptor agonist, VK2735, is being developed as both oral and subcutaneous formulations for the treatment of obesity.\u00a0Viking Therapeutics plans to advance oral VK2735 into phase III development for obesity in the fourth quarter of 2026. <\/p>\n Structure Therapeutics’ phase II ACCESS study on its orally administered GLP-1 RA, aleniglipron, demonstrated significant weight loss across all doses. Structure Therapeutics expects to initiate the late-stage program of aleniglipron in obesity in the second half of 2026. <\/p>\n Beyond its existing products, Novo Nordisk continues to invest heavily in next-generation obesity and metabolic disease therapies. The most advanced candidate in Novo Nordisk’s pipeline is CagriSema injection, a fixed-dose combination of a long-acting amylin analog, cagrilintide and semaglutide. The company filed a new drug application with the FDA in December 2025 for CagriSema\u00a0to treat obesity.\u00a0A decision is expected in the fourth quarter. Another key candidate for T2D and obesity is zenagamtide (formerly known as amycretin), a novel long-acting GLP-1 and amylin receptor agonist, in phase III. <\/p>\n While Novo Nordisk’s pipeline remains anchored by promising next-generation obesity therapies, recent setbacks in other late-stage programs have tempered investor optimism. Its shares plunged 8.9% on Friday after the company reported disappointing phase III ZEUS cardiovascular outcomes study results, marking another setback to its efforts to diversify beyond its blockbuster diabetes and obesity portfolio. The study failed to meet its primary endpoint, as investigational IL-6 inhibitor ziltivekimab did not reduce the risk of major adverse cardiovascular events compared with placebo in patients with atherosclerotic cardiovascular disease, chronic kidney disease and inflammation. Although the candidate demonstrated the expected biological activity by inhibiting the IL-6 pathway and lowering inflammatory markers such as hsCRP, these effects failed to translate into meaningful clinical benefits. <\/p>\n NVO also disclosed that the trial outcome would trigger a non-cash impairment charge in the third quarter of 2026, further dampening investor sentiment. Despite the disappointment, Novo Nordisk will continue the ongoing HERMES and ARTEMIS cardiovascular outcomes studies, with data expected in the first half of 2027, and reiterated that the ZEUS results do not alter its previously issued 2026 adjusted operating profit guidance. <\/p>\n Here’s How to Play NVO Stock Before Q2 <\/p>\n Ahead of second-quarter results, Novo Nordisk’s near-term outlook remains challenging, and the stock appears vulnerable even if the company delivers an earnings beat. Investors are likely to focus less on quarterly numbers and more on management’s commentary around GLP-1 prescription trends, pricing pressure in the United States and the competitive impact of Eli Lilly’s expanding obesity franchise. The recent failure of the phase III ZEUS cardiovascular outcomes study has further weakened confidence in Novo Nordisk’s pipeline diversification strategy, while intensifying competition, slowing growth in its core semaglutide franchise and continued estimate cuts suggest that downside risks remain elevated. <\/p>\n Given these headwinds, we believe investors should remain on the sidelines ahead of the earnings release. Although Novo Nordisk retains a strong position in the diabetes and obesity markets and continues to advance promising next-generation candidates such as CagriSema and zenagamtide, these longer-term opportunities are unlikely to offset near-term challenges. Until the company demonstrates a sustained improvement in prescription growth, competitive positioning and earnings visibility, the risk-reward profile remains unfavorable. <\/p>\n Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report<\/a> <\/p>\n Novo Nordisk A\/S (NVO) : Free Stock Analysis Report<\/a> <\/p>\n Eli Lilly and Company (LLY) : Free Stock Analysis Report<\/a> <\/p>\n Viking Therapeutics, Inc. (VKTX) : Free Stock Analysis Report<\/a> <\/p>\n Structure Therapeutics Inc. Sponsored ADR (GPCR) : Free Stock Analysis Report<\/a> <\/p>\n This article originally published on Zacks Investment Research (zacks.com).<\/a> <\/p>\n<\/a> Zacks Investment Research <\/p>\n
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