The Danish pharmacist Novo Nordisk ousted in early September LVMH – Parent company of Louis Vuitton – as Europe’s most valuable listed company This ended a two and a half year rule of the French luxury group.
LVMH, the world’s largest luxury retailer, is affected by growing doubts about the prospects of the Chinese economy.
For its part, Novo is facing a complete Wave of lawsuits against Ozempic and Wegovy, their powerful diabetes and weight loss drugs. That has pushed its earnings and shares to all-time highs.
Its shares are up about 20% since it announced on Aug. 8 that a large study showed Wegovy also had clear cardiovascular benefits. This bolsters the company’s hopes of moving beyond its image as a lifestyle drug.
As of Friday’s close, Novo Nordisk had a market capitalization of approximately $424.7 billion.including unlisted shares, according to data from LSEG and the company’s number of shares held.
LVMH, listed on the French Stock Exchange, had a market cap of $420.1 billion, making it the largest publicly traded company in Europe as of February 2021, when it knocked out consumer goods group Nestlé from first place.
Novo’s stock price has roughly tripled over the past three years, while that of LVMH, owner of fashion brands Louis Vuitton and Dior, has doubled.
The success of the Novo products
“Novo views LVMH as the largest market capitalization stock in Europe, reflecting the recent success of Novo products, while recent trends for LVMH have been more mixed.” Marcel Stotzel, co-manager of Fidelity European Fund and Fidelity European Trust,
Stotzel said both stocks remain key positions in his funds.
read Novo shares hit all-time highs on Monday, which underscores investor appreciation for a strategy that has given the company a first-mover advantage in a booming market for anti-obesity drugs.
This market is expected to reach $100 billion in annual sales within a decade. Sales are going well at the moment at 6 billion dollars, like Barclays.
Analysts say Novo’s price surge is likely to increase its weighting in the regional STOXX 600 index, which could attract more passive investor inflows.
Shares in Novo Nordisk ended Monday up 0.7%, while LVMH fell 0.4%. LVMH shares are down about 15% from the all-time high hit in April. underperformed the European STOXX 600, which lost around 2.2% over the same period.