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Investing.com - BMO Capital maintained its Market Perform rating and $50.00 price target on Novo Nordisk (NYSE:NVO), a prominent pharmaceutical player with an impressive 84% gross profit margin, following the company’s label expansion for Wegovy. According to InvestingPro data, the stock currently appears undervalued despite its strong fundamentals.
Wegovy received approval for the treatment of F2 and F3 MASH (metabolic dysfunction-associated steatohepatitis) patients, according to the updated product label.
BMO Capital described the approval as a "step in the right direction" for Novo Nordisk, potentially helping to shift momentum for the company after a challenging start to the year.
The pharmaceutical company has faced headwinds in recent months, including competition from compounders and multiple guidance cuts that negatively impacted its share price.
BMO Capital continues to view Novo Nordisk as a "show-me story" for the second half of the year but expects shares to trade higher when markets open Monday.
In other recent news, Novo Nordisk has been the focus of several analyst actions and legal developments. BNP Paribas (OTC:BNPQY) Exane upgraded Novo Nordisk’s stock to Neutral from Underperform, although it lowered the price target to DKK345.00. Meanwhile, HSBC raised its price target for the company to DKK355.00, maintaining a Hold rating, suggesting an 11% upside potential. Conversely, BMO Capital reduced its price target to $50.00, citing a strategic shift towards obesity and metabolic treatments amid competitive challenges. UBS downgraded the stock to Neutral from Buy, lowering the price target to DKK340.00, due to concerns about growth in the GLP1 market and competition from Eli Lilly (NYSE:LLY).
Additionally, Novo Nordisk has expanded its legal efforts, filing 14 new lawsuits against companies producing and marketing compounded semaglutide products. This brings the total to 132 complaints across 40 states, with 44 permanent injunctions already granted. The legal actions specifically target telehealth providers accused of violating state corporate practice of medicine laws. These recent developments reflect ongoing strategic adjustments and legal measures impacting Novo Nordisk’s business landscape.
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