Novo Nordisk A/S (NVO): investment thesis checklist
What a value investor writing down why they own Novo Nordisk A/S would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 601.5% in FY2019; between 104.4% and 601.5% over 4 filed years, median 130.4%. Does the thesis need it to stay inside that range?
- Return on equity: 52.8% in FY2025; between 52.8% and 450.2% over 10 filed years, median 72.4%. Does the thesis need it to stay inside that range?
- Gross margin: 81.0% in FY2025; between 81.0% and 84.7% over 10 filed years, median 84.1%. Does the thesis need it to stay inside that range?
- Operating margin: 41.3% in FY2025; between 41.3% and 44.2% over 10 filed years, median 42.8%. Does the thesis need it to stay inside that range?
- Net debt to EBITDA: -0.03x in FY2019; between -0.36x and -0.03x over 4 filed years, median -0.31x. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 19.5% in FY2025; between 3.3% and 19.5% over 10 filed years, median 8.5%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from Novo Nordisk A/S's own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Revenue Growth 1Y stays at or above 0%
Today 6.43%. Replayed over 6 filed years, it held in every one.
Current Ratio stays at or above 0.64x
Today 0.8x. Replayed over 6 filed years, it held in every one.
Free Cash Flow Yield stays at or above 4.06%
Today 5.07%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which revenue growth 1y fell below 0%.
- A filed year in which current ratio fell below 0.64x.
- A filed year in which free cash flow yield fell below 4.06%.
4. The published tests it meets today
Of 30 tests value investors published: 2 met, 18 not met, 10 we could not complete. Counts, never a score.
Meets: Cash-covered dividend; Cheapest quarter on P/E (David Dreman).
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
No card. 30 free days, and nothing is charged unless you choose a plan.
How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.