Novo Nordisk stock target cut at Citi on lack of margin growth

Citi Research has lowered its price target for Danish pharmaceutical company Novo Nordisk due to concerns over the company's ability to generate margin growth through 2030. The reduction in the target is based on Novo Nordisk's guidance for broadly stable margins, driven by increased research and development (R&D) spending. As a result, Citi has reduced its adjusted operating profit forecasts for 2028 to 2030 by 2% to 4%.

This brings the target price for Novo Nordisk from 310 Danish crowns to 296 crowns, with the company now trading at a valuation of 14 times 2027 earnings, down from 15 times. Additionally, Citi has lowered its expected annual earnings per share growth rate from 12% to 9% over the same period due to the lack of margin growth.