1 Reason I'm Never Selling Novo Nordisk Stock

Over the past two years, investors have sold off Novo Nordisk (NYSE: NVO) stock as it has faced a number of challenges. It has been losing ground in the GLP-1 market, which accounts for most of its revenue. Novo Nordisk's 2026 guidance implies that its revenue will decline this year. Despite the headwinds, there are many reasons to remain bullish on the company. Here's one reason why, as a shareholder, I intend to stay put.

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Experience matters

Novo Nordisk has built a reputation over the past 100 years as a leader in the diabetes drug market. The company has made many breakthroughs and developed several generations of important drugs over this long period. This deep, long-standing expertise grants Novo Nordisk several advantages. First, massive internal data on clinical trial successes and failures can help steer its research in the right direction.

It's not that surprising that it quickly established itself as a leader in the rising market for obesity drugs, considering obesity is classified as a chronic, metabolic disorder strongly linked to diabetes, a disease that belongs in the same category.

It's also not surprising that the one company beating Novo Nordisk in the weight-loss market right now, Eli Lilly (NYSE: LLY), also has a long and successful history in developing diabetes medicines. Novo Nordisk's clinical experience should eventually allow it to launch newer, better products.

Second, Novo Nordisk has the manufacturing infrastructure and know-how to produce therapies in its core therapeutic area at scale. Making GLP-1 drugs requires different manufacturing demands than those for many other types of medicines. Novo Nordisk's long-standing expertise in its niche means it can keep up with these manufacturing requirements and better meet the rising demand for GLP-1 products than most of its peers in the pharmaceutical industry.

Third, the company's brand name is widely recognized in its core field of expertise. Novo Nordisk inspires trust among physicians and patients, a factor that can help speed up the commercial adoption of its newer medicines. Thanks to these advantages, Novo Nordisk is well-positioned to bounce back.

It's a good time to buy

Novo Nordisk has several exciting pipeline candidates in phase 2 and phase 3 studies. The company should make significant clinical progress in the next few years. Meanwhile, revenue growth should also bounce back next year, as newer medicines -- such as CagriSema, which is currently under review -- hit the market and label expansions start to take effect. Lastly, Novo Nordisk is trading at just 10.4x forward earnings, which makes it dirt cheap by the standards of the healthcare sector, whose average forward price-to-earnings ratio is currently 17.8. Novo Nordisk's shares look attractive right now, and the company's expertise in its core area makes it worth holding onto for a long time.

Prosper Junior Bakiny has positions in Eli Lilly and Novo Nordisk. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.