🇩🇰🇺🇸 Novo Nordisk, the Danish pharmaceutical conglomerate, gapped up 7.3% yesterday on the approval of the pill version of Wegovy, their weight loss (among other applications) drug.

Novo Nordisk trades under the ADR $NVO, which is down 42% YoY. Compounded revenue growth has averaged 15% YoY over the last 4 quarters. Most of 2024-5 saw net margins between 33% and 39% as well as an industry-leading gross margin of 85%.

The January launch of the Wegovy pill will give $NVO a head start on the needle-averse marginal customer. Eli Lilly's ($LLY) orforglipron is still awaiting a green light, which is great for $NVO because $LLY chewed into their market share this year.

Orforglipron should get approval around March-April 2026, so $NVO will have at least the first quarter to try to make headway. After that, it'll probably come down to reimbursement terms and competitive negotiations with PBMs & government payers.

They may get approval for a higher-dose version (7.2mg) soon, and they also have early-stage GIP/GLP-1 co-agonist and once-weekly insulin products in the pipeline. They've laid off 9,000 employees and introduced new manufacturing lines in the U.S. & Europe.

$NVO is $51.61 at the moment. With their outstanding margins, their aggressive cost rationalization, and this opportunity to grab early market share in oral GLP-1s, their prospects seem strong. It could easily double, but it should rally to the mid-60s no problem.

This is in no way, shape, or form financial advice...

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🇺🇸 🇩🇪 10-Year American-German Government Bond Spread

This spread is narrowing again; it's down to 127 basis points mostly on the 10Y bund yield, which has risen to range highs.

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🌐 We're not done yet in precious metals this year. Today:

Gold is up 1.27%. Silver is up another 9.87%. Platinum is up 10.34%.

And palladium (did someone say palladium?) is up 13.07%

Technically platinum is still up on silver YTD by about one percent. This was the signal in the silver & platinum leasing in July.

Both are outrunning the daily Bollingers now.

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🌍 The futures price for rough rice has fallen to multi-decade support on strong U.S. inventories and quality issues abroad.

Something will have to give. $10/cwt is a tough price for producers who generally require $11-13 to break even.

High-quality U.S. growers (those who haven't suffered excess breakage from weather patterns of late) are still commanding a premium for their long-grain from Japan, Latin America, and the Caribbean as there are serious problems with other global supplies.

Prices for Vietnamese fragrant rice & Cambodian paddies have plummeted, including over quality concerns. Vietnamese exports were banned in the Philippines and Cambodian mills are struggling with basic benchmarks.

In India, the large market has struggled with insane levels of pesticide residues (Tricyclazole) and moisture control. African rice has been suffering from elevated levels of lead, arsenic, and cadmium.

Across South Asia, governments engage in intensive subsidy & support programs for their rice industries, which does put pressure on growers with fewer protections elsewhere, like the United States, but also likely contributes to the ongoing crisis in quality.

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