$NOVO B (+3,18%) ✌️🤌

Updated portfolio with new positions in $NBIS (+4,43%)
$ASTS (-2,15%)
$HIMS (+8,82%) and $NOVO B (+3,18%) . Closed $AAPL (+2,14%) for good as I believe they have been left behind in innovation for a long time now and its prospects are less attractice than the other Mag7 I hold ($NVDA (+3,19%) , $AMZN (+3,59%) , $GOOG (+3,76%)
$MSFT (+0,93%) and $TSLA (+6,14%) , ordered in decreasing % of overall portfolio). Also i doubled my position in $LLY (+1,37%) as currently experienced a healty but significant pullback.

Big part of portfolio is now in nuclear stocks, as I have increased my position in $OKLO and opened a position in $SMR

What do you think would be the most compelling 10-15y holds missing here? Please argument as I am very interested in learning macrotrends I may have overlooked.

$NOVO B (+3,18%)

Let me know your thoughts

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1. 🔑 Key Insights

• Novo Nordisk is a global leader in diabetes and obesity care, with a robust competitive moat built on brand trust, economies of scale, IP protection, and regulatory expertise.

• The company has delivered consistent growth, high margins, strong returns on capital, and disciplined financial management.

• Recent investor attention has been driven by the success of GLP-1 products like Ozempic and Wegovy, with growing global demand despite intensifying competition.

• While trading at a premium on certain valuation multiples, the stock appears justifiable based on growth-adjusted metrics and strong fundamentals.

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2. 🧩 Core Evaluation Areas

Valuation

• P/E (TTM): 20.3x

• PEG Ratio: 0.96 → Suggests earnings growth supports current valuation.

• Free Cash Flow Yield: 3.95%

• Estimated Intrinsic Value (DCF-based): ~$75/share

• Current Price: ~$72/share

• Margin of Safety Entry Point: ~$64/share

Growth Potential

• Short-Term: New indications for GLP-1 therapies, direct-to-patient services (e.g., NovoCare), and expanded U.S. distribution via CVS partnership.

• Long-Term: Global prevalence of diabetes/obesity; emerging market penetration; pipeline drugs beyond metabolic disease.

Operational Efficiency

• ROIC: ~30% vs. WACC of ~8.8% → value-accretive capital deployment

• Gross Margin: ~84.7%; Operating Margin: ~48.4%

• CapEx/FCF: ~66% (2024), rising due to manufacturing investments but still well-funded by operations

Risk Factors

Company-Specific (Moderate to High):

• U.S. sales pressure from compounded semaglutide products (now partially mitigated by FDA action)

• Competitive encroachment from Eli Lilly (Zepbound, Mounjaro)

Systemic (Low to Moderate):

• FX volatility (Denmark-based with significant U.S. revenue)

• Regulatory risks, particularly in pricing and generic entry

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3. 📌 Supporting Metrics & Comparisons

Metric Novo Nordisk Eli Lilly Pfizer

Market Cap (USD) ~$312B ~$700B ~$134B

P/E (TTM) 20.3x ~47x ~12x

FCF Yield 3.95% 0.56% 8.4%

Net Debt/EBITDA 0.76 ~0.5 ~1.0

• Novo appears more balanced on valuation and profitability than Lilly, though Pfizer trades cheaper due to lower growth prospects.

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4. 📈 Projections & Scenarios

• FCF Base: $10.7B (2024)

• Growth Forecast: 10–12% annually over the next 5 years (implicit via PEG and sector projections)

• DCF-Implied Range: $70–75 fair value; $64 as value-investor entry price with margin of safety

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5. ⚠️ Risk Assessment & Categorization

Risk Type Level Mitigants

Regulatory/Legal Moderate FDA crackdown on compounding; IP

Competitive Disruption High Continued R&D and brand equity

Financial / Liquidity Low High coverage, low net debt

Macro (FX, recession) Low-Mod Diverse global ops; non-cyclical

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6. ✅ Conclusion & Recommendation

Novo Nordisk is a high-quality, cash-generative business with a wide moat and well-managed balance sheet. While the stock is currently priced near intrinsic value, it presents an attractive opportunity for long-term investors with a patient, value-oriented strategy. The key is to wait for a modest pullback (~10–15%) to strengthen the margin of safety.

• Intrinsic Value Estimate: ~$75

• Buy Below: $64

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I challenge you to critique my current holdings. Any critique is welcome. Go!

Here are my current holdings:

$MSFT (+0,93%)

$META (+2,82%)

$MA (+1,49%)

$BRK.B (+1,58%)

$AMZN (+3,59%)

$ASML (+1,26%)

$MSCI (+1,28%)

$MC (+0,36%)

$BKNG (+1,21%)

$SPGI (+0,92%)

$ADBE (+0,49%)

$NOVO B (+3,18%)

$AIR (+0,04%)

$CDNS (+0,12%)

$OR (+0,41%)

$IDXX (+0,98%)

$EL (+1,18%)

$FTNT (+1,99%)

$LULU (+3,08%)

$NOVO B (+3,18%)

💡 Core Investment Thesis

• GLP-1 Dominance: Global leader in obesity/diabetes treatments (Ozempic® and Wegovy®), capturing structural demand from rising obesity rates (44% U.S. prevalence).
• Near-Term Volatility: U.S. compounded drug competition and tariff uncertainty create headwinds, offset by FDA action and pipeline expansion.
• Attractive Valuation: Trading at 19× P/E (vs Eli Lilly’s 58×), offering relative value in high-growth obesity market.

📊 Financial Health & Performance

Q1 2025 Highlights

• Revenue: DKK 78.1bn ($11.9bn, +18% YoY), driven by obesity care sales (+65% YoY).
• Profitability: Operating profit DKK 38.8bn (+20% YoY), beating estimates.
• 2025 Guidance:
• Sales growth lowered to 13–21% (from 16–24%).
• Operating profit growth trimmed to 16–24% (from 19–27%).
• Balance Sheet: Robust $9.8bn operating cash flow funding U.S. production expansion.

Key Headwinds

• Wegovy® sales below expectations due to U.S. compounded alternatives.

💷 Dividends & Shareholder Returns

• Current Yield: 1% (modest but growing).
• Coverage: Strong free cash flow supports consistent payouts.
• Capital Allocation: Prioritising $4.1bn U.S. manufacturing capacity to mitigate supply/tariff risks.

🌍 Governmental & Regulatory Exposure

Catalysts

• FDA Action: Ban on compounded semaglutide (May 2025) reclaiming market share.
• Tariff Reprieve: 50% U.S. duty on EU drugs postponed to July 2025, avoiding immediate cost shock.
• Pipeline Momentum: Oral obesity drug under FDA review; next-gen CagriSema filing in 2026.

Risks

• U.S. Trade Policy: 50% tariff implementation in July could erode margins by 10–15%.
• Medicare Pricing: Inflation Reduction Act negotiations may pressure long-term drug pricing.

📈 Growth Projections & Valuation

Short-Term (2025–2026)

• Price Target: $92.42 average (33% upside from $71.50).
• Catalysts:
• Compounded drug phaseout boosting H2 prescriptions.
• CVS Caremark exclusivity expanding Wegovy® access.

Long-Term (2030–2036)

• Market Potential: Global obesity drug market projected at $105–144bn by 2030.
• Upside Target: $197.75 by 2036 (177% upside) via oral GLP-1 adoption and pipeline expansion.

Valuation Metrics

• Share Price: $71.50
• P/E (TTM): 19× (Eli Lilly: 58×)
• Dividend Yield: 1%
• Analyst Upside: 33% consensus (range: $61–$138.53)

⚠️ Key Risks

Compounded Drug Persistence: 30% U.S. obesity patients still use alternatives post-FDA ban.

Pipeline Delays: CagriSema filing pushed to 2026; oral GLP-1 approval timeline uncertain.

Competition: Eli Lilly’s Zepbound® gaining share; Viking Therapeutics advancing rivals.

Tariff Impact: July duty could raise U.S. consumer costs by 15–20%.

🎯 Investment Recommendation

Accumulate Below $70 for Long-Term Growth

• Near-Term Catalyst: Q2 prescription data (August 2025) confirming market share recovery.
• Entry Strategy: Buy dips below $70; hedge with puts if U.S.-EU tariff talks stall.
• Total Return Scenarios:
• Base Case (60%): 33% upside + 1% yield by mid-2026.
• Bull Case (25%): $138+ with tariff resolution/CagriSema acceleration.
• Bear Case (15%): $61 if competition intensifies.

Bottom Line: Novo Nordisk remains a high-conviction obesity play with unshakeable long-term demand (1bn+ obese globally). Near-term volatility is a buying opportunity for patient investors.

Does Novo’s 19× P/E justify its leadership vs Lilly’s 58× premium?

Can FDA action fully eliminate compounded GLP-1 competition?

How will U.S. tariffs impact Novo’s $4.1bn manufacturing strategy?

Disclaimer: Not financial advice. Conduct your own due diligence.