① Analysts began discussions on whether Eli Lilly would become the first US company with a market capitalization of 1 trillion US dollars outside the Big Seven; ② Thanks to strong market demand for its novel weight loss drugs, Eli Lilly's stock price rose 34% this year, with a market capitalization of more than 740 billion US dollars.
Financial Services Agency, Feb. 18: US pharmaceutical giant Lilly's stock price has soared, even comparable to some high-growth tech giants. Analysts began discussions on whether the company would become the first US company outside the Big Seven to reach a market capitalization of 1 trillion US dollars.
$Eli Lilly and Co (LLY.US)$The stock price rose more than 3% on Friday to 782.06 US dollars/share, a record high. Thanks to strong market demand for its novel weight loss drug, Eli Lilly's stock price has risen 34% this year, with a market capitalization of more than $740 billion.
Of course, “stock god” Warren Buffett's business empire Berkshire Hathaway is also expected to compete for the honor of being the first trillion-dollar non-technology company. Berkshire is currently the 7th largest listed company in the US, with a valuation of about $880 billion.
Morgan Stanley analysts said in a client report: “Will Eli Lilly become the first biopharmaceutical stock to reach $1 trillion in market capitalization? We continue to see room for further growth.”
Eli Lilly surpassed Tesla in market capitalization last month, and the latter faced the dilemma of slowing sales growth. Tesla is currently the only company with a market capitalization of less than 1 trillion US dollars among the seven largest US stocks. The company currently has a market capitalization of 635.6 billion US dollars. Some people think Eli Lilly has a good reason to replace Tesla and become one of the top seven US stocks.
Eli Lilly announced fourth-quarter earnings this month that exceeded expectations, and the performance guidance was also higher than analysts' estimates. Institutions such as Societe Generale, Jefferies, and Barclays then raised Eli Lilly's target share prices.
Financial reports show that Eli Lilly's diabetes drug Mounjaro's sales for the fourth quarter of last year was US$2.21 billion, significantly higher than market expectations of US$1.75 billion, a significant increase from US$279.2 million in the same period last year. Zepbound, a diet medicine with the same ingredients as Mounjaro, went on sale in early December last year, with sales of US$176 million in the fourth quarter.
Eli Lilly expects 2024 revenue to be between US$40.4 billion and US$41.6 billion, with adjusted earnings per share between US$12.20 and US$12.70.
Zepbound and mounjaro belong to a class of drugs called GLP-1 (glucagon-like peptide-1). The principle of action is to lose weight by suppressing appetite and slowing gastric emptying. Patients can lose an average of 15% to 20% of their body weight after use.
CFRA Research analyst Sel Hardy said, “Since 2023, we've seen many retail investors' interest in Eli Lilly driven by the GLP-1 boom, but we don't think Eli Lilly is just a GLP-1 story.”
Hardy believes that Lilly has recently diversified its business through a series of acquisitions, and that the company's investment in R&D and increased sales of anti-cancer drugs are its strengths.
Editor/Corrine