Novo Nordisk vs. Viking Therapeutics: Which GLP-1 Stock Has More Upside?

Novo Nordisk (NVO) and Viking Therapeutics (VKTX) are key players in the obesity treatment market, with Novo Nordisk currently dominating the GLP-1 segment, reporting an 83% surge in Wegovy revenues in Q1 2025, while Viking's VK2735 shows potential as a competitor. Despite disappointing CagriSema data and increasing competition from Eli Lilly, Novo Nordisk is considered a safer investment due to its established market presence and recent deals with CVS Caremark and telehealth providers; however, Viking's promising pipeline and potential for high returns make it an attractive, albeit riskier, option for investors seeking exposure to the obesity market.

Analysis

Novo Nordisk (NVO) and Viking Therapeutics (VKTX) represent distinct investment opportunities within the burgeoning obesity treatment market. Novo Nordisk, an established pharmaceutical leader, commands approximately 54% of the GLP-1 market value share as of Q1 2025, driven by strong sales of its semaglutide drugs, notably an 83% surge in Wegovy revenues during the same quarter. The company has bolstered its manufacturing capabilities through the late 2024 acquisition of Catalent, leading to the removal of semaglutide products from the FDA’s shortage list, and secured strategic commercial advantages such as CVS Caremark making Wegovy a preferred GLP-1 therapy effective July 1 and a partnership with Hims & Hers Health. Despite these strengths and ongoing label expansion efforts for semaglutide, NVO faces significant competition from Eli Lilly and experienced a setback with disappointing late-stage trial data for its next-generation candidate, CagriSema. Conversely, Viking Therapeutics, a clinical-stage biotech, offers high growth potential primarily through its investigational dual GIP and GLP-1 receptor agonist, VK2735, which has shown promising results in early to mid-stage studies for both subcutaneous and oral formulations, with phase II oral data anticipated in H2 2025. VKTX is also expanding its pipeline with a novel DACRA candidate. However, Viking carries substantial risk due to its lack of approved products, reliance on clinical trial outcomes, and the competitive landscape dominated by established players. Financially, NVO's 2025 sales and EPS are projected to grow by 14% and 17% respectively, though estimates have trended downwards. VKTX's 2025 loss per share is expected to widen by 120%, with loss estimates also increasing. Year-to-date, NVO shares have declined approximately 22% and VKTX shares have fallen 33%, underperforming the industry's 6% decline. Valuation metrics indicate NVO trades at a significantly higher price-to-book ratio (15.46x) compared to VKTX (3.58x), reflecting its established market position versus Viking's developmental stage.

Key Decisions for Investors

• Investors considering Novo Nordisk should weigh its dominant market position, strong revenue growth from Wegovy, and enhanced production capacity against its premium valuation (P/B 15.46x), intense competition from Eli Lilly, and recent disappointing data for its pipeline candidate CagriSema.
• Viking Therapeutics presents a higher-risk, potentially higher-reward profile, contingent on the clinical success of VK2735, particularly the upcoming oral formulation phase II data in H2 2025; its significantly lower valuation (P/B 3.58x) may appeal to investors with a higher risk tolerance seeking exposure to biotech innovation in the obesity sector.
• Monitor key catalysts such as Viking's VK2735 clinical trial readouts and Novo Nordisk's ability to maintain market share, manage competitive pressures, and successfully execute on its pipeline expansions, including new indications for semaglutide.