Novo Nordisk (NVO) experienced a surge in stock value after the Denmark-based pharmaceutical company revised its sales and operating profit expectations. The increased outlook is primarily attributed to the high demand for its drugs, Ozempic and Wegovy, in the United States.
Strong Growth Anticipated
Novo Nordisk now projects a sales growth range of 32% to 38% for the year 2023, surpassing the previous estimate of 27% to 33%. Similarly, the company expects its operating profit growth to be between 40% and 46%, up from the prior forecast of 31% to 37%.
The Impact of Ozempic and Wegovy
The improved outlook can be mainly attributed to the exceptional performance of Ozempic and its closely-related drug, Wegovy. These drugs have witnessed an unprecedented surge in demand as patients are relying on them for weight loss purposes. Analysts surveyed by FactSet predict that Novo Nordisk will report revenue of $3.32 billion for Ozempic and $1.07 billion for Wegovy in the third quarter.
Positive Market Response and Promising Trials
On Friday, American depositary receipts of Novo Nordisk rose by 1.6% to reach $101.77. With this upward trajectory, the stock is expected to achieve a new high, according to Dow Jones Market Data. Moreover, Novo Nordisk recently concluded a trial for kidney failure in diabetes patients, where Ozempic exhibited notable success. As a result, the study was halted prematurely, signaling a significant milestone for the company.
Steady Growth throughout the Year
Novo Nordisk has had a remarkable year so far, with its stock witnessing a 50% increase. This notable growth further highlights the company’s strong performance and solid market position.