Dialysis stocks ‘over-reacting’ to FLOW top-line results, says Wells Fargo

Noting that dialysis names such as Baxter (BAX) and DaVita (DVA) were down from 13% to 18% intraday after positive top-line data from Novo Nordisk’s (NVO) FLOW study released last night, Wells Fargo attempted to estimate the potential impact of GLP-1s on new dialysis patients per year in the U.S. The firm, which see GLP-1s having “a small impact on dialysis,” says its analysis implies the compound annual growth rate of new dialysis patients would decline from 1.6% to 1.0%, or a 60 basis point reduction, if the penetration of GLP-1s in the entire chronic kidney disease population reached 18% by 2030. Given its analysis, the firm contends that “the market is over-reacting to the FLOW top-line results.” Wells has an Equal Weight rating and $44 price target on Baxter shares.