Novo Nordisk A/S (NVO): A Bull Case Theory

By Ricardo Pillai | October 22, 2025, 5:59 PM

We came across a bullish thesis on Novo Nordisk A/S on The Analyst's Journal’s Substack by A_Capital. In this article, we will summarize the bulls’ thesis on NVO. Novo Nordisk A/S's share was trading at $56.72 as of October 15th. NVO’s trailing and forward P/E were 14.98 and 14.08, respectively according to Yahoo Finance.

Novo Nordisk A/S represents a compelling long-term growth opportunity, underpinned by its dominant positions in diabetes and obesity care. The Danish pharmaceutical giant has leveraged nearly a century of insulin expertise to establish a comprehensive diabetes care ecosystem, serving a global market with approximately 50% share in insulin and a leading GLP-1 franchise with first-mover advantage in obesity treatment. Its GLP-1 products, particularly Ozempic and Wegovy, have positioned the company at the forefront of the obesity epidemic solution, creating a multi-decade growth runway.

Over the past decade, Novo Nordisk has delivered exceptional financial performance, growing revenue from $107.9 billion to $311.9 billion (LTM), with operating margins expanding to 47.7% and robust free cash flow generation supporting both R&D investment and strategic capacity expansion. The company’s innovation pipeline, fueled by 13.8% of revenues reinvested into R&D, and integrated manufacturing capabilities underpin sustainable competitive advantages, while strong regulatory expertise and a trusted brand reinforce its market leadership.

Looking forward, Novo Nordisk is poised to capitalize on massive growth opportunities, including expanding obesity treatment penetration, emerging market expansion, and next-generation GLP-1 formulations, with potential applications in NASH and other metabolic conditions. Risks include competitive pressures from Eli Lilly, biosimilar insulin entrants, regulatory changes, and pricing pressures, but the company’s strong balance sheet, operational scale, and innovation capacity mitigate these challenges.

For long-term investors, Novo Nordisk offers a rare combination of defensive and high-growth attributes, underpinned by secular tailwinds, financial resilience, and strategic optionality, making it a STRONG BUY with substantial upside potential and a multi-decade growth runway.

Previously we covered a bullish thesis on Novo Nordisk A/S (NVO) by Kontra Investments in May 2025, which highlighted strong revenue growth driven by diabetes and obesity care, robust margins, aggressive capital returns, and a promising GLP-1 pipeline. The company's stock price has depreciated approximately by 16.26% since our coverage. This is because the thesis didn’t fully play out amid U.S. market volatility. The thesis still stands as Novo maintains market leadership and long-term growth potential. A_Capital shares a similar perspective but emphasizes broader historical financial performance, scale, and multi-decade growth runway across insulin and GLP-1 franchises.

Novo Nordisk A/S is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held NVO at the end of the second quarter which was 60 in the previous quarter. While we acknowledge the potential of NVO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. 

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