Novo Nordisk upgraded to "outperform"

04/17/07 - Credit Suisse

LONDON, April 17 (newratings.com) - Analyst U Garcia-Sagues of Credit Suisse upgrades Novo Nordisk (NOV) from "neutral" to "outperform," while raising her estimates for the company. The target price has been raised from DKK460 to DKK570.

In a research note published this morning, the analyst mentions that the company has the ability to generate substantial growth, even without any further contribution from its pipeline, and is highly protected from generic erosion. The commercial potential of Novo Nordisk’s pipeline product, liraglutide, and the Levemir drug is higher than estimated by the markets, the analyst believes. The company’s margins are likely to expand rapidly, with a downturn in R&D expenses and with Levemir and liraglutide gaining market acceptance, Credit Suisse adds. The EPS estimates for 2007, 2008 and 2009 have been raised to DKK23.15, DKK26.80 and DKK30.41, respectively.