Novo Nordisk Shares Drop as Bank Downgrade Reflects Growth Concerns

Berenberg downgraded Novo Nordisk A/S (OMX: NVO) to a "Hold" rating, expressing concerns that the upside from its oral Wegovy pill is already priced into the stock. The brokerage firm noted that Eli Lilly and Co (NYSE: LLY) is rapidly gaining market share in the oral obesity treatment sector, an area where Novo Nordisk was expected to have a first-mover advantage. This downgrade led to a 2.08% drop in Novo Nordisk shares, trading at 46.19 DKK as of August 12, 2026, down from a previous close of 47.17 DKK.

The downgrade also involved a reduction in Novo Nordisk's price target from 325 DKK to 305 DKK, or approximately $47 for its NYSE-listed shares. Analyst Kerry Holford highlighted the escalating "battle for the pill" expected in the second half of 2026. While the anticipated opening of the US Medicare program to obesity drugs is projected to boost demand, Holford believes Eli Lilly is well-positioned to dominate this market, mirroring its current success.

This downgrade is part of a broader cautious sentiment surrounding Novo Nordisk. Earlier in the quarter, the company's US-listed shares fell over 6% after second-quarter adjusted sales of 78.49 billion DKK, or about $12.1 billion, and oral Wegovy sales of 3.22 billion DKK, slightly missed analyst expectations of 3.27 billion DKK. Morningstar also lowered its fair value estimate for Novo Nordisk to 285 DKK/$44 from 311 DKK/$48, citing increased reliance on cheaper pill options and disappointing performance from injectable cagrisema, leading to a reduction in long-term gross margin forecasts to the mid-70s from the high 70s.

Adding to the company's challenges, recent trial setbacks, such as the failed late-stage ZEUS trial for ziltivekimab, a drug targeting heart and kidney disease, previously caused Novo Nordisk's stock to decline by 9%. These setbacks, coupled with ongoing pricing pressures and increased competition, have amplified concerns about the company's pipeline diversification beyond its core GLP-1 franchise, with analysts from Citi maintaining a 'Neutral' rating.