Editing Novo Nordisk A/S (section)

== Catalyst and competitive analysis: ==
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The main competitors of NVO in the market includes: Wuxi biologics (HKG: 2269), Eli Lily (LLY), Johnson & Johnson (JNJ), Merk Co (MRK), AstraZeneca (AZN), Pfizer (PFE). 
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The PE value of NVO is 49.43, where the most related competitor Eli Lily (LLY) is 72.19, which is undervalued comparatively. In the recent update, the Eli Lily has beat the market expectation in the second-quarter earnings. Elil Lily saying that there is a surge in demand for Mounjaro, which they experienced delays in fulfilling the demand. This indicating that there is a huge increase in demand and so does the sales increase in the related drug. Therefore, the Jefferies analyst Akash Tewari upgraded shares of Eli Lilly to Buy from Hold and raised his price target from $430 to $615. He mentioned that NVO's product, weight-loss drug Wegovy in a trial, known as SELECT, has reduced the risk of heart attack and stroke in obese and overweight patients by 20%, exceeding expectations. These views from the market indicating more money will be entering the pharmaceutical industry and specifically the weight-loss drug. This news caused both LLY and NVO to rise over 15% in one day. On top of that, NVO has a lower PE value comparing to his industry and therefore a higher increase than its industry.
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The financial strength of NVO includes: the cash-to-debt of 1.09, which is similar to its competitiors above, which has all recently increases the debt in the past 2 years. This could mean that the market has recently focusing on these area in the weight loss drug market, the R&D budget has increased. Looking at the current ratio and quick ratio of 0.86 and 0.67, which are currently under 1, but the industry has a similar number. The equity-to-asset and the debt-to-EBITDA is 0.32 and 0.31 respectively, they are both better than the market by 63% and 70%. The Piotroski F-score, Altman Z-score and the Beneish M-score all points to the safe indicator, indicating NVO is not likely to be a manipulator on their financials. For the Profitability strength: the Gross Margin%, Net Margin%, ROA%, ROE%, ROCE% and ROIC% are all significantly better than the biotechnology industry by 80 to 98%. For the comparative indicators: the PE, PB, PEG, PS ratio is similar to the industry, but if we compare to S&P500 market, there is a 17% increase margin comparing to the ratios of S&P500 market, indicating there is still 17% profit. 
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Furthermore, the operating cash flow has a consistent increase in the past 10 years, much higher the the net income and they also have a negative financing and investing cash flow. The Free cash flow increase steadily over the past 10 years, which is a good indicator to buy. 

Last but not least, the difference in ROIC to WACC % remains positive in the past 10 years. Although there is a decrease since 2015, this is because of the market capital size of NVO has increased in the past 10 years, so this is reasonable. The current ROIC-WACC% is still 27.2%.<ref>https://www.gurufocus.com/stock/NVO/summary</ref> 
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Comparing to its competitor Wuxi (HKG:2269), for macro analysis, the M1 to M2 value in the China market is a negative value, indicating that the money is not coming out to the market, lower buying power. Also, thePPI remain very low, much lower than the expectation, which is currently at -4.40. The PPI to CPI ratio has a negative value of -4.10. These all indicating that the US market is healthier than the China market, the money is likely to buy NVO comparatively.<ref>https://en.macromicro.me/charts/260/cn-china-m1-m2</ref>          [[File:Screenshot 2023-08-10 at 11.37.51.png|thumb]]