Analyzing 2024 Fallen Growth Stocks Part 2: Novo Nordisk, Lululemon, Fiserv Investment Strategy

In the previous article, we examined Duolingo and HIMS. Now, let us analyze the remaining three stocks - Novo Nordisk, Lululemon, and Fiserv. While these belong to different industries, they share one commonality: the market may have overreacted.

💉 Novo Nordisk: Obesity Treatment Pioneer, Down 56% in 1 Year

Game Changers: Ozempic and Wegovy

Novo Nordisk has revolutionized the healthcare industry with GLP-1 obesity treatments:

Ozempic: Started as diabetes medication, gained explosive popularity for weight loss
Wegovy: Dedicated obesity treatment drug
Massive market potential: Growing global obesity population
Excellent clinical data: Proven cardiovascular health benefits

Why Did It Plunge 56%?

Intensifying competition: Rival products like Eli Lilly Mounjaro/Zepbound emerging
Supply issues: Production capacity cannot meet demand
Pricing pressure: Insurance companies and governments pushing for price cuts
Side effect concerns: Some reported adverse events
Valuation adjustment: Correction of excessively inflated expectations

Why It Still Deserves Attention

Structural mega-trend:

Obesity is a global health crisis
GLP-1 market projected for explosive growth over next decade
Beyond weight loss: comprehensive metabolic health solution

Novo competitive advantages:

Decades of diabetes treatment expertise
Strong R&D pipeline
Global distribution network
Brand credibility

💰 What is the Right Entry Price?

For Novo Nordisk, consider:

When production capacity expansion plans are announced
When differentiated clinical data versus competitors is secured
When P/E ratio falls to pharmaceutical industry average
An additional 10-15% drop from current prices

Especially if quarterly results confirm market share defense, it could be a good opportunity.

👕 Lululemon: Athleisure Icon, Down 54% YTD

The Power of Premium Branding

Lululemon is more than just an athletic wear brand:

Highly loyal customer base: Cult-level brand following
Premium pricing strategy: Maintaining high margins
Lifestyle brand: Combined with wellness and mindfulness culture
Product innovation: Technically superior fabrics and designs

Background of the Stock Plunge

Weakening consumer sentiment: Reduced demand for expensive products
Intensifying competition: Offensive from Nike, Adidas, and various athleisure brands
China market slowdown: Economic slowdown in key growth market
Inventory issues: Excess inventory in some product lines
Growth rate slowdown: Normalization after explosive pandemic growth

Fundamental Reassessment

Still strong points:

Brand power remains intact
High customer lifetime value (LTV)
New growth driver through menswear market entry
Successful omnichannel strategy through digital channel strengthening

Concerning points:

Ability to maintain premium pricing
Whether China market recovers
Ability to respond to intensifying competition

💰 What is the Right Investment Price?

For Lululemon:

When China market recovery signals are detected
When comparable store sales rebound
When P/E ratio falls to 15-18x level
An additional 5-10% adjustment from current prices

Given strong brand power, it could rebound quickly once fundamentals are confirmed.

💳 Fiserv: Hidden Powerhouse of Fintech Infrastructure, Down 70% YTD

Invisible but Essential Infrastructure

Fiserv is unfamiliar to general consumers but is core financial industry infrastructure:

Payment processing: Processing countless card transactions
Banking software: Core banking systems for financial institutions
Merchant services: Payment solutions for merchants
Clover platform: Integrated POS system for small businesses

Why Did It Fall So Much?

Economic slowdown concerns: Worries about transaction volume decline
Intensifying competition: Challenges from emerging fintechs like Stripe, Square
Valuation burden: Correction from past overvaluation
Integration costs: Cost burden from past M&A integrations
Interest rate environment: Pressure on growth stocks from high interest rates

Why Reassessment is Needed

Stable business model:

Recurring and predictable revenue
High barriers to entry (high switching costs)
Economically defensive characteristics (essential infrastructure)
Consistent cash flow generation

Growth potential:

Continued growth in digital payments market
Expanding penetration in SMB market
Cross-selling opportunities (integrated solutions)

💰 What is the Right Entry Price?

For Fiserv:

When Free Cash Flow Yield exceeds 5%
When P/E ratio falls below 15x
When quarterly results confirm transaction volume stabilization
Current price level also attractive for long-term investors

A 70% decline seems excessive, and current prices are worth considering.

🎯 Comparative Analysis of Three Stocks

Risk Ranking (Low → High)

Fiserv: Stable infrastructure, defensive characteristics
Novo Nordisk: Growth market, but competition risks
Lululemon: Consumer goods, high economic sensitivity

Growth Potential Ranking (High → Low)

Novo Nordisk: Obesity treatment mega-trend
Lululemon: Global athleisure market expansion
Fiserv: Stable but limited explosive growth

Investment Strategy Suggestions

Conservative investors: Fiserv-focused, some Novo Balanced investors: Equal distribution across three stocks Aggressive investors: Novo Nordisk-focused, some Lululemon

📊 Final Summary

The five stocks examined in this series (Duolingo, HIMS, Novo Nordisk, Lululemon, Fiserv) have all fallen significantly, but each has different reasons and different recovery possibilities.

The key points:

Simply being down a lot should not be the reason to buy
Comprehensively consider fundamentals, valuations, and industry outlook
Choose stocks matching your investment style and risk tolerance
Maintain diversification and long-term perspective

When the market panics, it is sometimes the best opportunity. However, distinguishing whether that fear is justified or excessive is the key to successful investing. 💪