Novo Nordisk Sheds $15 Billion In Market Value Following Warning Of Significant Challenges

Novo Nordisk A/S (ADR) NVO stock suffered a drop of about 15 percent thus losing about $15 billion in market value after the company issued a warning on profit forecast for the full year.

The company indicated its sales forecast are around 5-6 percent for the full year, while adjusted operating profit is guided between 5-7 percent in local currencies. The company blamed the challenging market conditions in the US for its revised outlook.

Novo fixed operating profit growth target of 10 percent in February, but now the company believes it won't be able to achieve.

President and CEO, Lars Rebien Sørensen, commented, "We have reassessed our long-term target for operating profit growth and our R&D strategy in the light of the challenging market environment in the USA. As a result, we are reducing our global cost base and parting company with some of our valued employees. Going forward we are confident that our strong product portfolio with innovative products like Tresiba®, Victoza® and semaglutide will enable us to deliver on our revised growth targets."

Novo reported its results for the nine-month period:

  • Operating profit fell one percent in local currencies.
  • Adjusted operating profit grew 7 percent.
  • Sales in USA advanced 6 percent.
  • Net Profit grew 10 percent to DKK 29.2 billion.
  • EPS advanced 12 percent to DKK 11.50.

At last check, the stock plunged 14.51 percent to $35.00 in the pre-market session.

Posted In: NewsGuidanceMovers
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