It's been a rough past two years for Novo (NYSE: NVO). The healthcare giant has lost market share in the GLP-1 industry, leading to a more than 60% drop in its share price. Novo is now trading at 11.8x forward earnings, well below the 18.6x average for healthcare stocks. Is Novo far too cheap to ignore at current levels? Or is it a value trap? Let's find out. Image source: The Motley Fool. Novo generates the lion's share of its revenue from its GLP-1 products, particularly Wegovy, a weight-loss medicine, and Ozempic, a diabetes drug. Competition from Eli Lilly (NYSE: LLY) has led to declining sales growth for both products. But that's only part of the story. Another issue is that Novo has experienced several clinical setbacks, prompting many investors to question whether it can remain a leader in the GLP-1 space.
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