Morgan Stanley Upgrades Novo Nordisk, Cuts Price Target to 250 DKK
Morgan Stanley raised Novo Nordisk’s rating to Equal-weight from Underweight after a 40% share price drop since January, cutting its price target to 250 DKK from 270. The bank forecasts 5% sales growth and 4% EBIT growth through 2029, noting 130,000 weekly Wegovy Pill scripts and $4.4 billion peak CagriSema sales.
1. Rating Upgrade and Price Target Adjustment
Morgan Stanley upgraded Novo Nordisk to Equal-weight from Underweight, reflecting a 40% share price decline since late January. The price target was cut to 250 DKK from 270 DKK as the current valuation now better accounts for mid-term growth uncertainty and semaglutide risks.
2. Mid-Term Growth and Risk Outlook
The bank projects 5% sales growth and 4% EBIT growth across 2026–2029, noting the stock trades at roughly 11 times 2026 earnings. It expects sales and profit growth to moderate this year due to softer U.S. performance forecasts.
3. Drug Pipeline Highlights
Disappointing REDEFINE-4 results for CagriSema led to a peak sales forecast of $4.4 billion and highlighted complex U.S. positioning limited to patients refractory to Zepbound. Meanwhile, Wegovy Pill prescriptions reached about 130,000 weekly scripts in week seven, lifting forecasts to $2 billion in 2026 and $3.4 billion in 2027.
4. Competitive and Market Risks
Risks persist in U.S. injectable Ozempic and Wegovy trends, which are running below initial expectations. Competition will intensify with Eli Lilly’s orforglipron launch in Q2 2026, a key catalyst for the obesity market and a potential challenge to Wegovy Pill’s trajectory.