Burke Wealth Management, an investment management company, released its “Focused Growth Strategy” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The market had another outstanding year in 2024, with the S&P 500 rising 25.0%. The strategy had an even better year, with net returns of 28.4%. Looking a bit closer, it is clear that, similar to 2023, 2024 had a rise that was appreciated by everyone, but the overall market returns were concentrated in a small handful of stocks. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Burke Wealth Management emphasized stocks such as Novo Nordisk A/S (NYSE:NVO). Novo Nordisk A/S (NYSE:NVO) engages in the research and development, manufacture, and distribution of pharmaceutical products. The one-month return of Novo Nordisk A/S (NYSE:NVO) was -2.90%, and its shares lost 37.88% of their value over the last 52 weeks. On March 18, 2025, Novo Nordisk A/S (NYSE:NVO) stock closed at $80.98 per share with a market capitalization of $357.034 billion.
Burke Wealth Management stated the following regarding Novo Nordisk A/S (NYSE:NVO) in its Q4 2024 investor letter:
“Novo Nordisk A/S (NYSE:NVO): Shares of Novo-Nordisk were under consistent pressure during the fourth quarter, first following the nomination of Robert F. Kennedy Jr. to head the Department of Health and Human Services and second following the release of Phase III results of its Cagri-Sema obesity drug. Regarding RFK’s nomination, we are going to wait until he is confirmed and sets an agenda before we leap to the conclusion that he is going to somehow eliminate one of the most popular and important drug classes (GLP-1s) in the country. We’d also point out that a well-known car company executive who seems to have President Trump’s ear as well is a GLP-1 success story in weight loss. Regarding Cargri-Sema, we think the 20% decline in Novo shares following the release of its Phase III results was more than a bit harsh. Currently, there are two GLP-1 products approved for obesity- Novo’s Wegovy (Semaglutide) and Eli Lilly’s Zepbound (Tirzepatide). There are many drugs from numerous companies in development. Novo’s next product in the space will be Cagri-Sema, which is a combo treatment featuring Cagrilintide and Semaglutide. In mid-December, Novo released results of its Phase III trials for Cagri Sema which showed an average weight loss of 22.7% across a test group whose average weight at the start of the trial was 235 pounds. This was short of the 25% target that management had implicitly endorsed in conversations with analysts which explains the disappointment with what on the surface looked like pretty solid results. It is worth pointing out that these results are in-line with Zepbound, which typically delivers average weight loss of 20% and better than Wegovy, which typically delivers average losses in the 15% range. Obesity is going to be the biggest drug class in history and we have not even reached the point where enough supply is available to even allow Lilly to advertise in the US. This market has a long way to grow and will certainly comfortably support more than one winner. Further, we think it is a little presumptive for investors to permanently jettison Novo to a distant #2 in the market with questionable long-term relevance in a single morning of trading on the heels of results that would have likely been favorably received but for the 25% target that had become the expectation.: Shares of Novo-Nordisk were under consistent pressure during the fourth quarter, first following the nomination of Robert F. Kennedy Jr. to head the Department of Health and Human Services and second following the release of Phase III results of its Cagri-Sema obesity drug. Regarding RFK’s nomination, we are going to wait until he is confirmed and sets an agenda before we leap to the conclusion that he is going to somehow eliminate one of the most popular and important drug classes (GLP-1s) in the country. We’d also point out that a well-known car company executive who seems to have President Trump’s ear as well is a GLP-1 success story in weight loss. Regarding Cargri-Sema, we think the 20% decline in Novo shares following the release of its Phase III results was more than a bit harsh. Currently, there are two GLP-1 products approved for obesity- Novo’s Wegovy (Semaglutide) and Eli Lilly’s Zepbound (Tirzepatide). There are many drugs from numerous companies in development. Novo’s next product in the space will be Cagri-Sema, which is a combo treatment featuring Cagrilintide and Semaglutide. In mid-December, Novo released results of its Phase III trials for Cagri Sema which showed an average weight loss of 22.7% across a test group whose average weight at the start of the trial was 235 pounds. This was short of the 25% target that management had implicitly endorsed in conversations with analysts which explains the disappointment with what on the surface looked like pretty solid results. It is worth pointing out that these results are in-line with Zepbound, which typically delivers average weight loss of 20% and better than Wegovy, which typically delivers average losses in the 15% range. Obesity is going to be the biggest drug class in history and we have not even reached the point where enough supply is available to even allow Lilly to advertise in the US. This market has a long way to grow and will certainly comfortably support more than one winner. Further, we think it is a little presumptive for investors to permanently jettison Novo to a distant #2 in the market with questionable long-term relevance in a single morning of trading on the heels of results that would have likely been favorably received but for the 25% target that had become the expectation.”
An elderly couple receiving insulin from a pharmacist, representing healthcare company’s successful pharmaceutical products.
Novo Nordisk A/S (NYSE:NVO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 64 hedge fund portfolios held Novo Nordisk A/S (NYSE:NVO) at the end of the fourth quarter compared to 61 in the third quarter. While we acknowledge the potential of Novo Nordisk A/S (NYSE:NVO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Novo Nordisk A/S (NYSE:NVO) and shared the list of stocks market experts are talking about these days. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.