Eli Lilly Just Delivered Another Blowout Quarter. Is This Unstoppable Growth Stock Still a Buy?
The drugmaker continues its impressive run.
Over the past two years, Eli Lilly's financial results have more closely resembled those of a smaller, high-growth tech company rather than a mature pharmaceutical firm. Industry observers expect the company's revenue and earnings growth to slow significantly, but that prediction may have to wait a bit longer. The latest quarterly update reveals another impressive quarter for the company.
Eli Lilly's GLP-1 products, particularly its Zepbound and Mounjaro therapies, have been driving most of the revenue growth. These drugs account for a significant portion of the company's top line, with Mounjaro revenue increasing 65% year over year to $10.7 billion and Zepbound revenue rising 49% to $5.4 billion. Despite lower net realized prices due to increased volume, Eli Lilly's core therapies remain highly popular with patients.
Beyond its core therapeutic area, Eli Lilly made progress with several other medicines. The company's oral weight loss drug, Foundayo, generated $184 million in revenue, exceeding investor expectations. Additionally, Eli Lilly's pipeline for Alzheimer's disease, eczema, and cancer drugs are also showing strong sales growth.
For the full fiscal year 2026, Eli Lilly now projects revenue between $91 billion and $92 billion, surpassing its previous guidance range of $85 billion to $87 billion. This earnings beat and guidance raise have driven the company's stock price higher, leading some investors to question whether it's too late to buy Eli Lilly stock. However, despite potential pricing pressures from other pharmaceutical giants launching competing GLP-1 medicines, the company's pipeline is robust and promising.
Eli Lilly's GLP-1 market share is still relatively low, with only 7% of diabetes patients and 2% of those with obesity currently using these therapies. With a projected expansion of the market and a diverse pipeline of promising candidates like retatrutide, Eli Lilly still holds a significant position in this rapidly growing field. The company's diversified pipeline and potential for new approvals within the next several years further support its long-term growth prospects.
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