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Novo Nordisk (NVO) Declines More Than Market: Some Information for Investors

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In the latest trading session, Novo Nordisk (NVO - Free Report) closed at $58.98, marking a -1.12% move from the previous day. The stock fell short of the S&P 500, which registered a loss of 0.53% for the day. On the other hand, the Dow registered a loss of 0.09%, and the technology-centric Nasdaq decreased by 1%.

Coming into today, shares of the drugmaker had gained 21.81% in the past month. In that same time, the Medical sector gained 0.09%, while the S&P 500 gained 2.06%.

Investors will be eagerly watching for the performance of Novo Nordisk in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.9, marking a 1.1% fall compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $12.11 billion, showing a 1.19% drop compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates project earnings of $3.57 per share and a revenue of $47.95 billion, demonstrating changes of +8.84% and 0%, respectively, from the preceding year.

Investors might also notice recent changes to analyst estimates for Novo Nordisk. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Novo Nordisk is currently sporting a Zacks Rank of #5 (Strong Sell).

With respect to valuation, Novo Nordisk is currently being traded at a Forward P/E ratio of 17. This indicates a premium in contrast to its industry's Forward P/E of 15.3.

The Large Cap Pharmaceuticals industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 216, positioning it in the bottom 12% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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