Eli Lilly Stock Surges on Rapid Growth in Weight-Loss Medications
Obesity treatments, which were once thought of as a specialty area, are now among the most profitable areas of healthcare. In this regard, Eli Lilly became the first pharmaceutical company to join the exclusive group dominated by tech titans when its market value reached $1 trillion. This accomplishment highlights its ascent to prominence in the weight-loss industry. Due in significant part to the rapid expansion of the market for weight-loss medications, the company’s stock has increased by more than 35% this year. Eli Lilly became a member of the $1 trillion club on Friday because of this spike.
Eli Lilly Trades at Record Valuation as Obesity Drug Sales Soar
According to LSEG statistics, Lilly is currently trading at one of the highest valuations in the global pharmaceutical industry, over 50 times its projected earnings over the next 12 months. This illustrates investors’ faith in the continued high demand for obesity medications. Additionally, shares have significantly surpassed the US equities market as a whole. Lilly has made over 75% since the release of Zepbound in late 2023. The S&P 500 increased by somewhat more than 50% throughout that time. Lilly reported sales from its obesity and diabetes portfolio of over $10.09 billion in the most recent quarter. More than half of its $17.6 billion in total income came from this.
They are doing so many things outside of obesity, but to suggest anything is driving share price beyond obesity at this point, I don’t know if that would be a factual statement,
Kevin Gade, chief operating officer at Lilly shareholder Bahl and Gaynor
Investors Eye Orforglipron Approval Early Next Year
By 2030, Wall Street projects that the weight-loss medication market will be valued at $150 billion, with Lilly and Novo accounting for the majority of anticipated global sales. Now, investors are concentrating on Lilly’s oral obesity medication, orforglipron, which is anticipated to receive approval early next year. The most recent generation of GLP-1 medications has already become a sales sensation, according to a note written by Citi analysts last week. Additionally, they stated that orforglipron is well-positioned to profit from the advancements made by its injectable forebears.
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