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Novo Nordisk (NVO) to Report Q4 Earnings: What's in the Cards?
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Novo Nordisk (NVO - Free Report) is anticipated to beat estimates when it reports its fourth-quarter and full-year 2023 results on Jan 31 before the opening bell.
Let’s see how things are shaping up for the quarter to be reported.
Factors at Play
Novo Nordisk operates under two segments: Diabetes and Obesity Care and Rare Disease.
The company’s revenues in the last reported quarter were driven by higher sales of Diabetes and Obesity Care products. Diabetes medicines like Ozempic, Rybelsus and fast-acting insulin, Fiasp, are expected to have put up a strong performance in the fourth quarter.
Obesity Care (Saxenda and Wegovy) sales were up significantly year over year in the third quarter of 2023, primarily due to increased Wegovy sales. This was observed after a second contract manufacturer for Wegovy initiated production in April 2023 to meet the increasing demand for the drug. Hence, the strong sales trend of Wegovy is expected to have continued in the to-be-reported quarter, boosting revenues from this segment.
Net sales in the Rare Disease segment were down in the last reported quarter due to a temporary reduction in the manufacturing output of rare endocrine disorder products. This trend is likely to have continued in the fourth quarter.
However, Novo Nordisk’s rare blood disorder products observed a year-over-year increase. Sales of the company’s Hemophilia A and B drugs are expected to have increased and contributed to NVO's revenues in the to-be-reported quarter.
Higher distribution costs, promotional activities related to Ozempic and Rybelsus, and Obesity Care market development activities are likely to have spiked Novo Nordisk’s sales and distribution costs in the fourth quarter of 2023. This, coupled with higher research and development costs driven by clinical activity for late-stage studies, is likely to hurt profits in the quarter to be reported.
Earnings Surprise History
The company has a mixed earnings surprise history. Earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, matched once and missed on another occasion, delivering an average earnings surprise of 0.58%.
In the past year, shares of Novo Nordisk have shot up 55.4% compared with the industry’s 19.8% growth.
Image Source: Zacks Investment Research
What Our Model Predicts
Our proven model predicts an earnings beat for Novo Nordisk this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Earnings ESP: NVO has an Earnings ESP of +0.89%.
Zacks Rank: Novo Nordisk currently sports a Zacks Rank #1.
Novo Nordisk A/S Price, Consensus and EPS Surprise
Novartis’ stock has jumped 19.5% in the past year. The company topped earnings estimates in each of the last four quarters. NVS delivered a four-quarter earnings surprise of 6.99%, on average. Novartis is scheduled to release its fourth-quarter results on Jan 31.
AstraZeneca (AZN - Free Report) has an Earnings ESP of +3.17% and a Zacks Rank #3 at present.
AstraZeneca’s stock has gained 1.9% in the past year. It beat earnings estimates in each of the last four quarters. AZN has a four-quarter earnings surprise of 8.30%, on average. AstraZeneca is scheduled to release its fourth-quarter results on Feb 8.
Sanofi (SNY - Free Report) has an Earnings ESP of +13.01% and a Zacks Rank #3 at present.
Sanofi’s stock has risen 3.2% in the past year. It beat earnings estimates in three of the last four quarters while missing in one. SNY has a four-quarter earnings surprise of 2.88%, on average. Sanofi is scheduled to release its fourth-quarter results on Feb 1.
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Novo Nordisk (NVO) to Report Q4 Earnings: What's in the Cards?
Novo Nordisk (NVO - Free Report) is anticipated to beat estimates when it reports its fourth-quarter and full-year 2023 results on Jan 31 before the opening bell.
Let’s see how things are shaping up for the quarter to be reported.
Factors at Play
Novo Nordisk operates under two segments: Diabetes and Obesity Care and Rare Disease.
The company’s revenues in the last reported quarter were driven by higher sales of Diabetes and Obesity Care products. Diabetes medicines like Ozempic, Rybelsus and fast-acting insulin, Fiasp, are expected to have put up a strong performance in the fourth quarter.
Obesity Care (Saxenda and Wegovy) sales were up significantly year over year in the third quarter of 2023, primarily due to increased Wegovy sales. This was observed after a second contract manufacturer for Wegovy initiated production in April 2023 to meet the increasing demand for the drug. Hence, the strong sales trend of Wegovy is expected to have continued in the to-be-reported quarter, boosting revenues from this segment.
Net sales in the Rare Disease segment were down in the last reported quarter due to a temporary reduction in the manufacturing output of rare endocrine disorder products. This trend is likely to have continued in the fourth quarter.
However, Novo Nordisk’s rare blood disorder products observed a year-over-year increase. Sales of the company’s Hemophilia A and B drugs are expected to have increased and contributed to NVO's revenues in the to-be-reported quarter.
Higher distribution costs, promotional activities related to Ozempic and Rybelsus, and Obesity Care market development activities are likely to have spiked Novo Nordisk’s sales and distribution costs in the fourth quarter of 2023. This, coupled with higher research and development costs driven by clinical activity for late-stage studies, is likely to hurt profits in the quarter to be reported.
Earnings Surprise History
The company has a mixed earnings surprise history. Earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, matched once and missed on another occasion, delivering an average earnings surprise of 0.58%.
In the past year, shares of Novo Nordisk have shot up 55.4% compared with the industry’s 19.8% growth.
Image Source: Zacks Investment Research
What Our Model Predicts
Our proven model predicts an earnings beat for Novo Nordisk this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Earnings ESP: NVO has an Earnings ESP of +0.89%.
Zacks Rank: Novo Nordisk currently sports a Zacks Rank #1.
Novo Nordisk A/S Price, Consensus and EPS Surprise
Novo Nordisk A/S price-consensus-eps-surprise-chart | Novo Nordisk A/S Quote
Other Stocks to Consider
Here are some other stocks in the same industry that too have the right combination of elements to beat on earnings this time around:
Novartis (NVS - Free Report) has an Earnings ESP of +3.39% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Novartis’ stock has jumped 19.5% in the past year. The company topped earnings estimates in each of the last four quarters. NVS delivered a four-quarter earnings surprise of 6.99%, on average. Novartis is scheduled to release its fourth-quarter results on Jan 31.
AstraZeneca (AZN - Free Report) has an Earnings ESP of +3.17% and a Zacks Rank #3 at present.
AstraZeneca’s stock has gained 1.9% in the past year. It beat earnings estimates in each of the last four quarters. AZN has a four-quarter earnings surprise of 8.30%, on average. AstraZeneca is scheduled to release its fourth-quarter results on Feb 8.
Sanofi (SNY - Free Report) has an Earnings ESP of +13.01% and a Zacks Rank #3 at present.
Sanofi’s stock has risen 3.2% in the past year. It beat earnings estimates in three of the last four quarters while missing in one. SNY has a four-quarter earnings surprise of 2.88%, on average. Sanofi is scheduled to release its fourth-quarter results on Feb 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.