Shares of Novo Nordisk’s (NVO) are down over 9% at the time of writing after the company announced the results from its latest weight-loss drug trial, Redefine 2. The trial showed that patients on the highest dose of CagriSema lost 15.7% of their weight, compared to a 3.1% weight loss for those on the placebo.
The Redefine 2 trial included 1,206 participants who were obese or overweight and had type 2 diabetes. Although the company said that the results “confirmed the superior efficacy of CagriSema,” this still missed expectations of a 25% reduction in weight. Interestingly, investors had a similar reaction after Novo Nordisk’s Redefine 1 trial also missed expectations.
Novo Nordisk’s announcement comes as the company continues to face increasing competition in the weight-loss market. Indeed, its rival Eli Lilly (LLY) recently announced plans to increase the supply and cut the costs of its weight-loss drug Zepbound. As a result, Novo Nordisk cut the cost of its weight-loss drug Wegovy in half for U.S. patients who pay in cash through its direct-to-patient online pharmacy.
Is NVO Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on NVO stock based on five Buys, four Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 39% decline in its share price over the past year, the average NVO price target of $109.29 per share implies 38.7% upside potential.
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