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On Thursday, JPMorgan analysts revised their outlook on Novo Nordisk (NYSE:NVO) stock, reducing the price target to DKK1,000 from DKK1,050. Despite the adjustment, they maintained an Overweight rating on the company’s shares. The decision follows the pharmaceutical company’s fourth-quarter results for 2024, which prompted slight increases in sales and operating profit forecasts for 2025 and 2026 by 1-2%. However, projections for the years 2027 to 2030 were reduced by 2-3% due to the anticipated delay in the launch of CagriSema, now expected in the first quarter of 2027.
The analysts noted that earnings per share (EPS) forecasts for 2025 have been lowered by 5% due to significant hedging losses and a projected higher tax rate of 22%. Additionally, EPS estimates for 2026 were trimmed by 2%, with further reductions of 4-5% from 2027 to 2030. Despite these revisions, JPMorgan projects a 16% compound annual growth rate (CAGR) in top-line revenue from 2024 to 2029, which is expected to translate into a 19% EPS CAGR. This growth rate is still considered to be double that of the sector’s.
For the year 2025, the analysts forecast approximately 22% constant exchange rate (CER) growth in sales and a 23% increase in operating profit at CER. These figures are 4% and 6% ahead of the consensus, respectively. JPMorgan anticipates that confidence in Novo Nordisk’s growth will strengthen throughout the year, bolstered by rising U.S. prescriptions for its GLP-1 franchises and consistent strong growth in international operations, where a 20% CER growth is expected for the full year of 2025.
The analysts also expect confidence in CagriSema, Novo Nordisk’s treatment for obese type 2 diabetics, to be restored as more data becomes available. The next significant update is anticipated to be the REDEFINE-2 study results, which are due to be released in the first quarter of 2025.
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