Catalent Earnings: COVID-19 Product Sales Fall; Novo Holdings Acquisition to Expand Wegovy Capacity

Catalent reported second-quarter revenue for fiscal 2024 of $1.03 billion, representing a 10% decrease compared to the second quarter of 2023. The declines were primarily due to falling demand for COVID-19-related products and operational challenges the company is working to right-size. We think Novo Holdings’ recently announced acquisition of Catalent for $16.5 billion or $63.50 per share in cash, represents a fair price for Catalent as it is very close to our intrinsic valuation of $65 per share. Pending regulatory approvals, we anticipate the transaction will close around the end of 2024.