Equity Research · Realized Position
Novo Nordisk
NVO · Pharmaceuticals · Metabolic Health
I bought the GLP-1 leader believing the selloff was overdone. It wasn't — the thesis broke, and I sold.
Quan Pham · M’Squared Capital Research · August 2026
What the market is missing
My mistake started as a reasonable-sounding call: that Novo's category leadership and manufacturing scale would defend both share and the multiple, and that the drawdown was excessive. I thought the market was over-punishing a franchise leader.
Why I owned it
I entered at $55 on that view. The bet was that share retention would hold — that is the load-bearing assumption in any category-leader thesis, and it is the one I was underwriting.
What has to happen
It needed share retention to hold while the market's fear burned off.
What would prove me wrong
This is the honest part: the load-bearing assumption broke. CagriSema disappointed, Lilly's tirzepatide out-executed, and US drug-pricing and political pressure intensified — all at once. When share retention, the core of the thesis, failed, the thesis was simply wrong, not early.
Valuation & exit
I cut at $39 — a realized loss of roughly 29% — rather than average down into deterioration. I do not fight a broken franchise thesis, and the discipline to exit when the core assumption fails is what kept a bad trade from becoming a worse one.
Position
Long
Realized return
−29.1%
Entry → Exit
$55.00 → $39.00
Initiated
26 Aug 2025
Sector
Pharmaceuticals
Status
Stopped out
Last updated
August 2026
This note is the opinion of M’Squared Capital and is provided for informational purposes only. It is not investment advice, nor an offer or solicitation to buy or sell any security. Price targets and entry and exit levels reflect the firm’s proprietary views and realized transactions; they are not forecasts of future results. The firm may hold, add to, reduce, or close any position at any time without notice. Past performance is not indicative of future results.