Eli Lilly and Company
LLY
$1255.40
+0.88%
Eli Lilly & Co. is a global pharmaceutical company focused on neuroscience, cardiometabolic, cancer, and immunology, with key products including Mounjaro, Zepbound, and Verzenio. As a market leader in the rapidly expanding GLP-1 weight-loss and diabetes space, Lilly has established a dominant competitive position, particularly with its oral drug Foundayo and next-generation candidate retatrutide. The current investor narrative centers on the company's explosive growth in the obesity market, recent European approval for Foundayo, and the potential for retatrutide to further solidify its lead over competitors like Novo Nordisk. However, concerns about valuation and competition from Pfizer and others continue to fuel debate, even as the company raises guidance and beats earnings expectations.…
LLY
Eli Lilly and Company
$1255.40
Related headlines
Investment Opinion: Should I buy LLY Today?
Rating & Thesis: We rate Eli Lilly as a Buy, driven by its dominant position in the high-growth GLP-1 market, exceptional revenue growth, and robust pipeline. The consensus rating is 'Buy' with an average target price of $1,299, implying ~10% upside, which we believe is achievable given the company's execution.
Sign up to view all
LLY 12-Month Price Forecast
The AI assessment leans bullish, driven by Lilly's exceptional growth metrics and dominant market position. However, the high valuation and competitive risks temper confidence. The stock's performance over the next 12 months hinges on pipeline execution and competitive dynamics. If growth remains robust and retatrutide succeeds, the stock could reach the bull case; otherwise, it may stagnate or decline. Monitoring quarterly earnings and clinical milestones will be crucial.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Eli Lilly and Company's 12-month outlook, with a consensus price target around $1310.90 and implied upside of +4.4% versus the current price.
Average Target
$1310.90
0 analysts
Implied Upside
+4.4%
vs. current price
Analyst Count
—
covering this stock
Price Range
$850 - $1600
Analyst target range
Eli Lilly is covered by 27 analysts, with a consensus recommendation of 'Buy' (mean rating of 1.71 on a scale where 1 is Strong Buy). The average price target is $1,299.01, implying an upside of approximately 10.1% from the current price of $1,180.16. The analyst sentiment is strongly bullish, with no sell ratings and a majority of buy/overweight ratings, as evidenced by recent actions from major firms like Citigroup, UBS, and Morgan Stanley, all maintaining positive ratings in July 2026. The target price range is wide, from a low of $850 to a high of $1,600, reflecting high uncertainty about the future growth trajectory and competitive dynamics in the GLP-1 market. The high target assumes continued dominance and successful pipeline execution, while the low target likely prices in potential competitive threats or regulatory setbacks. The recent ratings actions show no downgrades, indicating sustained confidence among analysts, though the wide spread suggests that the stock's valuation is highly sensitive to news flow and execution.
Bulls vs Bears: LLY Investment Factors
Eli Lilly presents a compelling growth story with exceptional revenue growth, robust margins, and a promising pipeline, but the stock trades at a premium valuation that leaves little room for error. The bull case is supported by strong fundamentals and analyst optimism, while the bear case centers on valuation risk and competitive threats. Currently, the evidence slightly favors the bulls given the company's execution and market position, but the key tension lies in whether Lilly can sustain its growth trajectory amid intensifying competition and regulatory pressures. If growth decelerates or pipeline setbacks occur, the stock could face significant downside.
Bullish
- Explosive Revenue Growth: Q1 2026 revenue surged 55.5% YoY to $19.8B, driven by the cardiometabolic franchise (Mounjaro, Zepbound) contributing $15.76B. This marks a significant acceleration from the prior year's Q1 revenue of $12.73B, demonstrating robust demand for GLP-1 therapies.
- Exceptional Profitability and Margins: Gross margin stands at 83.8% and operating margin at 45.6%, reflecting strong pricing power and operational efficiency. Net income of $7.4B in Q1 2026 translates to a net margin of 37.4%, well above industry norms.
- Pipeline Momentum with Retatrutide: Retatrutide, a next-generation weight-loss drug, has an official FDA filing timeline, positioning Lilly to extend its lead over Novo Nordisk. Superior efficacy data and a clear regulatory path could drive future growth beyond current products.
- Analyst Consensus and Target Upside: With 27 analysts, consensus is 'Buy' (mean rating 1.71) and average target price is $1,299, implying ~10.1% upside from the current price of $1,180. No sell ratings and recent upgrades from major firms like Citigroup and UBS reinforce positive sentiment.
Bearish
- Rich Valuation with High Expectations: Trailing PE is 46.7x, significantly above the market average, and even forward PE of 24.9x implies the market expects flawless execution. The PEG ratio of 0.49 suggests growth is priced in, leaving little room for disappointment.
- Intense Competitive Threats: Pfizer's berobenatide and Viking Therapeutics' pipeline pose potential challenges to Lilly's GLP-1 dominance. If competitors deliver comparable efficacy with better convenience or pricing, Lilly's market share could erode, impacting long-term growth.
- Regulatory and Reimbursement Risks: Weight-loss drugs face scrutiny over pricing and long-term safety. European approval for Foundayo is a positive, but any regulatory setbacks or reimbursement restrictions could dampen adoption and revenue growth.
- High Sensitivity to News Flow: The stock's 52-week range ($685-$1,249) and recent volatility (max drawdown -23.3%) highlight its sensitivity to clinical trial results, FDA decisions, and competitive announcements. Any negative news could trigger sharp sell-offs.
LLY Technical Analysis
Eli Lilly's stock is in a strong long-term uptrend, with a 1-year price change of +72.43% and a current price of $1,180.16, which is near the upper end of its 52-week range (52-week low: $685.15, high: $1,249.45). The stock is trading at approximately 94.5% of its 52-week range, indicating strong momentum and investor confidence, though it is slightly off its all-time high, suggesting a potential consolidation phase after a significant run. The 6-month change of +13.48% and YTD change of +9.24% further confirm the upward trajectory, though the pace has moderated from the explosive growth seen earlier in the year.
Beta
0.51
0.51x market volatility
Max Drawdown
-23.3%
Largest decline past year
52-Week Range
$694-$1293
Price range past year
Annual Return
+76.9%
Cumulative gain past year
| Period | LLY Return | S&P 500 |
|---|---|---|
| 1m | +7.9% | +2.5% |
| 3m | +17.9% | +2.7% |
| 6m | +24.4% | +11.1% |
| 1y | +76.9% | +20.5% |
| ytd | +16.2% | +12.3% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
LLY Fundamental Analysis
Eli Lilly's revenue growth is exceptional, with Q1 2026 revenue of $19.80 billion, up 55.5% year-over-year, driven by the cardiometabolic segment (including Mounjaro and Zepbound) which contributed $15.76 billion. This marks a significant acceleration from the prior year's Q1 revenue of $12.73 billion, and the company has consistently grown revenue over the past five quarters, from $11.40 billion in Q3 2024 to the current level. The oncology segment also showed strength with $2.27 billion in revenue, while immunology and neuroscience contributed smaller but stable amounts, indicating a well-diversified portfolio with the GLP-1 franchise as the primary growth engine.
Quarterly Revenue
$19.8B
2026-03
Revenue YoY Growth
+55.5%
YoY Comparison
Gross Margin
81.9%
Latest Quarter
Free Cash Flow
$13.6B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is LLY Overvalued?
Given Eli Lilly's strong profitability (net income of $7.40 billion in Q1 2026), the PE ratio is the most appropriate valuation metric. The trailing PE is 46.73x, while the forward PE is 24.93x, implying that the market expects significant earnings growth, which is consistent with the company's PEG ratio of 0.49. This gap between trailing and forward PE suggests that the market is pricing in substantial future earnings expansion, which is justified by the rapid adoption of its weight-loss drugs and the potential of retatrutide. Compared to the industry average (not provided), Lilly's PE is at a premium, but its superior growth and margins (gross margin 83.8%, operating margin 45.6%) support this premium.
PE
46.7x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 28x~76x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
35.8x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Eli Lilly's debt-to-equity ratio of 1.60 indicates a leveraged balance sheet, though interest coverage is adequate given operating income of $8.85B in Q1 2026. The company's heavy reliance on the GLP-1 franchise (80% of revenue) creates concentration risk; any disruption in supply, pricing, or demand for Mounjaro/Zepbound could disproportionately impact earnings. Additionally, R&D expenses of $3.51B in Q1 (17.7% of revenue) are essential for pipeline advancement but pressure near-term margins if revenue growth slows. Free cash flow of $13.58B TTM provides a cushion, but continued high capital expenditure for manufacturing expansion could strain liquidity if growth disappoints.
FAQ
The key risks include: 1) Competitive threats from Pfizer, Novo Nordisk, and Viking Therapeutics, which could erode market share; 2) Regulatory risks, such as pricing controls or safety concerns that could limit adoption; 3) Valuation risk, as the stock trades at a premium and is sensitive to any growth disappointment; 4) Concentration risk, with 80% of revenue from the GLP-1 franchise. The most severe risk is a clinical failure or competitive breakthrough that could lead to a -42% decline to the 52-week low.
The 12-month forecast is bullish, with a base case target of $1,299 (50% probability), a bull case of $1,600 (30% probability), and a bear case of $850 (20% probability). The most likely scenario is continued growth driven by Mounjaro and Zepbound, with the stock reaching the average analyst target. However, the outcome depends on pipeline execution and competitive dynamics. If retatrutide succeeds, the stock could outperform; if not, it may underperform.
LLY trades at a trailing PE of 46.7x, which is a premium to the broader market, but the forward PE of 24.9x suggests the market expects significant earnings growth. The PEG ratio of 0.49 indicates that the stock is undervalued relative to its growth rate, as a PEG below 1 typically signals undervaluation. Compared to peers, Lilly's premium is justified by its superior margins (83.8% gross, 45.6% operating) and revenue growth of 55.5%. Overall, the stock is fairly valued to slightly undervalued, but the market's expectations are high.
LLY is a good buy for investors with a long-term horizon and tolerance for volatility, given its dominant position in the high-growth GLP-1 market. The stock offers a 10.1% upside to the average analyst target of $1,299, but the trailing PE of 46.7x indicates high expectations. The biggest downside risk is competitive disruption or regulatory actions that could compress the multiple. For those who believe in the long-term obesity market growth, LLY is a compelling buy, but it may be less suitable for risk-averse investors.
LLY is best suited for long-term investment, given its growth stage and the multi-year opportunity in the obesity market. The stock has a beta of 0.506, indicating lower volatility than the market, but it can still experience significant swings due to news flow. The dividend yield is low at 0.56%, so income investors may look elsewhere. A minimum holding period of 3-5 years is recommended to ride out volatility and capture the full growth potential of the GLP-1 franchise and pipeline.