Why Novo Nordisk Stock Sank by Nearly 4% Today

Novo Nordisk (NYSE: NVO) stock had a Monday to forget, as news from a top rival dampened sentiment on the Danish pharmaceutical company. A price target cut from an analyst tracking the company only exacerbated the situation. By market close that day, Novo Nordisk's shares were down by 3.5%, in contrast to the generally buoyant S&P 500 (SNPINDEX: ^GSPC), which edged almost 1% higher.

A rival makes a move

That rival is none other than giant U.S. pharmaceutical company Eli Lilly. It announced that it will make the highest dosages of its Zepbound weight-loss drug available to any adult with a qualifying prescription via its website beginning in August.

Image source: Getty Images.

Zepbound, a direct competitor to Novo Nordisk's pioneering Wegovy, is already available on Lilly's website, albeit in lower doses.

With the addition of the two highest-dose versions, all dosages of the drug will be offered through the company's portal. With this, Eli Lilly has a fine chance of poaching more market share from the European company.

Price target cut

Meanwhile, well before the market open, J.P. Morgan prognosticator Richard Vosser cut his price target on the company. He now feels its Denmark-listed stock is worth 650 kroner ($101) these days, down significantly from his previous fair-value assessment of 1,000 kroner ($155). He maintained his overweight (i.e., buy) recommendation, however.

Neither of these developments is positive for Novo Nordisk. However, investors didn't react by panic-selling the stock; instead, it suffered only a minor sell-off. This is telling; Wegovy is still a hotly popular drug and should remain so, given the high levels of obesity in this country, and Americans' desire for a relatively easy fix for this.

Should you invest $1,000 in Novo Nordisk right now?

Before you buy stock in Novo Nordisk, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Novo Nordisk wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $870,207!*

Now, it’s worth noting Stock Advisor’s total average return is 988% — a market-crushing outperformance compared to 172% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 9, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.