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Novo Nordisk A/S (NVO) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Novo Nordisk A/S (NVO)

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Intrinsic Value (DCF)

Current$59.64
→
Intrinsic$525.36
+781%
$345.01$525.36$883.77
Market implies 1% growth for 5 years
DCF analysis suggests NVO could have 781% upside at 23% growth — verify assumptions match your view.
At $60, the market prices in only 1% growth — below historical 23%, suggesting low expectations.
Range: Bear $345 → Bull $884. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →19%21%23%25%
8%$669$725$786$850
10%$448$485$525$568
12%$331$359$388$419
14%$260$281$304$328

Bull Case

  • Bull case ($884) offers 1382% upside at 27% growth, 8% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (23%)

Bear Case

  • Bear case ($345) with 18% growth, 12% discount rate
  • Using 23% growth — aggressive, watch for mean reversion
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5-Year Free Cash Flow Projection

Year 1$85.36B
Year 2$104.60B
Year 3$128.18B
Year 4$157.07B
Year 5$192.48B
Terminal$3.05T

📐 Model Inputs

Growth Rate22.5%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate9.5%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$69.66BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

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Frequently Asked Questions

Is NVO stock undervalued or overvalued?
🟢 UNDERVALUED

NVO trades at $59.64 vs. our DCF-derived intrinsic value of $387.10, implying +300% upside. At a 9.5% WACC and 22.5% projected FCF growth, the market appears to be underpricing the present value of NVO's future cash flows. The bear case ($252.99) still suggests upside, providing margin of safety.

What is NVO's intrinsic value?

Using a 5-year DCF model: Base FCF of $69.66B, projected at 22.5% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 9.5% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $87.13B net debt and dividing by 4.46B shares: Bear $252.99 | Base $387.10 | Bull $583.69. Current price $59.64 implies +300% to base case.

How is NVO's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 22.5% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=9.5%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($1814.75B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 26.1x.