ETC Stock has appreciated by 66%

ETC Stock Rise 66%: From GLP-1 Dominance to Market Scepticism

1. Key Data for the Stock Price Rise

Cumulative Decline: Since its 2024 peak, ETC Stock (NVO.US) has risen 66%, with its market capitalization increasing by over $300 billion.

Recent Performance: On July 29th, it rose 23% in a single day, before plummeting 30% intraday, its largest drop on record.

Year-to-Date Performance: Since 2025, it has risen 35%, significantly underperforming the S&P 500.

2. Key Reasons for the Rise

Continuous Downgrades in Earnings Guidance

U.S. Market: Sales of Wegovy (weight loss drug) and Ozempic (diabetes medication) have been impacted by generic drugs, with illegal generics still circulating after the FDA ban.

International Market: Penetration rates in Europe, Asia, and other regions are lower than expected, leading to intensified competition.

The 2025 sales growth rate has been lowered from the 13%-21% projected at the beginning of the year to 8%-14% (the second downward revision).

Operating profit growth was revised downward from 16%-24% to 10%-16%, reflecting sluggish growth.

Weakness in key markets:

Lilly (LLY) faces strong competition.

Lilly's Zepbound (weight loss drug) has surpassed Wegovy in US prescriptions, capturing market share.

The market is skeptical of ETC's ability to maintain its leadership in the GLP-1 field.

Management turmoil

The unexpected removal of former CEO Lars Fruergaard Jørgensen (who helmed the company for eight years) in May sparked investor concerns.

New CEO Maziar Mike Doustdar (who took over on August 7) faces the challenge of restoring market confidence.

3. Market Reaction and Industry Impact

Investor panic: Mizuho analysts say short-term expectations for weight loss drugs are "overly inflated" and require a reassessment of long-term growth.

Competitors affected: Lilly (LLY) shares fell 6%, putting pressure on the overall weight loss drug sector.

European stocks dragged down: ETC stock's gains narrowed the Stoxx 600's gains, with the healthcare sector leading the decline by 8%.

4. Future Outlook

Key Catalysts:

August 6th Earnings Report: Market focus on detailed Q2 data and management's new strategy.

New Indication Approvals: For example, the regulatory decision for Wegovy for the treatment of non-alcoholic steatohepatitis (MASH).

Long-Term Challenges:

How to cope with competition from Eli Lilly, the impact of generic drugs, and bottlenecks in international market expansion.

Can the new CEO reverse the decline and restore investor confidence?

Conclusion: ETC stock's rise reflects deep market concerns about the sustainability of GLP-1 drug growth. The stock price may continue to face pressure in the short term, while its long-term outlook depends on the new management's strategic adjustments and changes in the market competitive landscape.