It is difficult to argue with the kinds of consequences Lilly's creams(NYSE: Lly) have produced over the past five years. The company has been one of the best performing pharmaceutical giants, with its shares leaving the wider market in the dust.
Some may argue that it is too late for investors to enter on Lilly's Eli, while others may feel that his work in the diabetes and obesity markets will still make them an attractive long -term option. Which side is right? Let's find out how Lilly could perform through the end of the decade, and decide if it's still worth investing in the stock.
First, let's consider how Eli Lilly's newest products will affect its performance in the next half decade. These new medicines include Alzheimer's Kisunla disease treatment, OMVOH ulcerated colitis medicine, and cancer drug jaypirca.
Of course, Lilly's most important new products are the treatment of Diabetes Mounjaro and Zepbound Weight Management Medicine, which shares the active ingredient Tirzepatide. In 2024, Eli Lilly's revenue increased 32% year -on -year to $ 45 billion. The Tirzepatide franchise contributed about $ 16.5 billion – although it has been on the market for less than three years.
Analysts have anticipated an annual sales peak of $ 25 billion for this compound. They may have been in her low ball. I expect Zepbound and Mounjaro to continue their trajectory up through 2030, although more competition is likely to lead to less impressive sales growth.
However, the other medicines in Lilly's new portfolio, which do not yet contribute much, will rise in prominence. Consider Kisunla, which fills a significant need in the treatment of Alzheimer's disease. According to some estimates, it could generate about $ 2.5 billion in revenue by 2030. Jaypirca and OMVOH should also contribute meaningfully through the end of the decade.
That is, Eli Lilly's revenue should continue to grow on a good clip. The company's guidance hub for 2025 suggests a sales growth of about 32% for the year, a great performance for a Pharmaceutical giant. I would be surprised if its annual top line growth went below 15% in any year through 2030.
Eli Lilly has several exciting products in the pipeline, some are likely to gain approval in the next five years. Consider two of the company's leading weight loss candidates: Overforglipron and Retatrutide. Both medicines are in phase 3 studies, but not only as weight loss control products: they are developed as potential therapies for diabetes, sleep apnea, and several other conditions.
What makes them so promising? Consider Retatrutide, a triple agonist-he mimics the action of three hormones: GLP-1, CIP, and GCG. That could be an improvement on even Tirzepatide, which mimics GLP-1 and CIP. Tirzepatide was the first of its kind. Retatrutide still has to prove its value in clinical trials.
The point is that Lilly's pipeline in the increasingly competitive glp-1 market looks stronger than any of her peers not named Novo Nordisk. According to some estimates, retatrutide could generate $ 5 billion by 2030, while overforglipron could reach $ 8.3 billion in sales by then.
Naturally, other new Lilly products could see daylight by 2030, while others will move on to late stage studies. That could be true of the drug maker's highly investigative gene therapy for deafness. In addition, many of its existing products are likely to gain label expansions. The lineup should look even stronger by the end of the decade.
Bears may highlight the price-to-win (P/E) of Eli Lilly of 39.
The average healthcare industry is 17.7 as this writing. If Lilly is currently overvalued, it could underperform a wider equity in the medium term. Would investors be best to wait for a better access point?
My view is that the stock is valued fairly. Lilly's revenue and earnings have been growing much faster than those of most of his peers of a similar size in the Healthcare industrySo it only makes sense that he has a higher P/E.
I expect Eli Lilly to beat the market through the next five years. Beyond that, given its incredible innovative abilities, it will still be an excellent stock.
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