Vltava Fund, an investment management company, recently released its third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The letter is addressed “Value Traps and Growth Traps,” based on the firm’s three new investments from the last quarter. While value and growth stocks seem like clear categories, the author believes they are interconnected rather than opposites. A value trap occurs when investors buy seemingly cheap stocks with underlying structural issues, resulting in stagnation or a decline in share price. However, a growth trap arises when investors purchase shares of rapidly growing companies with high valuations that unexpectedly slow down, leading to reduced projections and declining valuation multiples. Basically, both value and growth are two sides of a coin, and the investor should combine a reasonable price with a realistic outlook. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its third-quarter 2025 investor letter, Vltava Fund highlighted 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 -7.97%, and its shares lost 48.20% of their value over the last 52 weeks. On October 3, 2025, Novo Nordisk A/S (NYSE:NVO) stock closed at $59.63 per share, with a market capitalization of $263.101 billion.
Vltava Fund stated the following regarding Novo Nordisk A/S (NYSE:NVO) in its third quarter 2025 investor letter:
“Novo Nordisk A/S (NYSE:NVO) probably needs no long introduction. It is one of Europe’s largest companies and a global leader in the treatment of two major lifestyle diseases – diabetes and obesity. The company has grown historically through the development and production of insulin and has held a dominant share of the global market in that group of products for decades. In recent years, obesity treatment has become its key growth segment. Its best-known product is Wegovy, which has proven to be highly effective in weight reduction. A smaller part of the business consists of drugs for rare diseases, particularly in the areas of hemophilia and growth hormone therapy. Novo Nordisk has highly integrated production, from molecule development to fully automated filling lines for injection pens, and global distribution to more than 170 countries, with a focus on the United States, Europe, and a rapidly growing share in Asia. Its biggest competitor is Eli Lilly, and these two companies now effectively form a duopoly in modern treatment of diabetes and obesity. Barriers to entry into the industry are extremely high, due to long development times, regulation, and enormous investments in production and distribution.
We have been following Novo Nordisk through the entire existence of the Vltava Fund, which means for more than 21 years. We have never owned its shares, however, either because we found them too expensive or had other more attractive opportunities available to us. During 2023–2024, Novo Nordisk definitively joined the ranks of global leaders in a new era of medicine. The success of its Ozempic and Wegovy medications has shown that obesity treatment is not just a niche segment, but a huge growth opportunity with direct impact on the health of millions of people. Demand for these drugs far exceeded supply, and the company invested heavily in expanding production. The market began to appreciate that Novo Nordisk had moved beyond traditional diabetology and become synonymous with innovation and long-term growth in an additional market segment. This narrative was increasingly reflected in the share price. From DKK 400 in the autumn of 2022, the price gradually climbed to beyond DKK 1,000 in the summer of 2024, at which time the stock was trading at roughly 45 times this year’s expected earnings. This price implicitly included very optimistic assumptions about future profitability…” (Click here to read the full text)
Novo Nordisk A/S (NYSE:NVO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 45 hedge fund portfolios held Novo Nordisk A/S (NYSE:NVO) at the end of the second quarter, compared to 60 in the previous quarter. While we acknowledge the risk and potential of Novo Nordisk A/S (NYSE:NVO) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Novo Nordisk A/S (NYSE:NVO) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Novo Nordisk A/S (NYSE:NVO) and shared the list of best stocks to buy and hold for a lifetime. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.
READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.
Disclosure: None. This article is originally published at Insider Monkey.
