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Technical: Trading below 50-day ($954.27) and 200-day ($909.39) moving averages indicates momentum stall.
Quantitative: DCF models indicate downside risk, with heavily weighted discounted earnings yielding $587.43.
Eli Lilly (LLY) exhibits explosive top-line hyper-growth, with revenue surging from $34.1B in 2023 to $65.1B in 2025, fueled by its dominant GLP-1 franchise. Despite unparalleled clinical and commercial momentum, the current share price of $851.21 slightly overshoots our intrinsic fair value estimate of $821.95.
Eli Lilly (LLY) exhibits explosive top-line hyper-growth, with revenue surging from $34.1B in 2023 to $65.1B in 2025, fueled by its dominant GLP-1 franchise. Despite unparalleled clinical and commercial momentum, the current share price of $851.21 slightly overshoots our intrinsic fair value estimate of $821.95.
Unprecedented efficacy and entrenched pipeline in incretin-based metabolic therapies.
Massive scale and expanding specialized manufacturing capacity (fill-finish).
Quantitative: DCF models indicate downside risk, with heavily weighted discounted earnings yielding $587.43.
Hold. While the underlying business quality is exceptional, valuation limits near-term upside. The stock trades at a premium reflecting peak execution, leaving a narrow margin of safety.
Eli Lilly and Company discovers, develops, manufactures, and markets human pharmaceutical products in the United States, Europe, China, Japan, and internationally. The company offers cardiometabolic health products, including Basaglar, Humalog, Humalog Mix 75/25, Humalog U-100, Humalog U-200, Humalog Mix 50/50, insulin lispro, insulin lispro protamine, insulin lispro mix 75/25, Humulin, Humulin 70/30, Humulin N, Humulin R, Humulin U-500 for diabetes; Jardiance, Mounjaro, and Trulicity for type 2 diabetes; and Zepbound for obesity. It also provides oncology products, such as Cyramza for the second-line treatment of gastric cancer or gastro-esophageal junction adenocarcinoma; Erbitux for colorectal cancers and head and neck cancers; Inluriyo for breast cancer; Jaypirca for chronic lymphocytic leukemia or small lymphocytic lymphoma; Retevmo for the treatment of metastatic NSCLC; TYVYT for classic hodgkin's lymphoma; and Verzenio for breast cancer. In addition, the company offers immunology products, which include Ebglyss for severe atopic dermatitis; Olumiant for rheumatoid arthritis, atopic dermatitis, severe alopecia areata, and COVID-19; Omvoh for ulcerative colitis; and Taltz for plaque psoriasis, psoriatic arthritis, ankylosing spondylitis, and non-radiographic axial spondylarthritis. Further, it provides Emgality for migraine prevention and episodic cluster headache, as well as Kisubla for symptomatic Alzheimer's disease. The company has collaborations with Boehringer Ingelheim Pharmaceuticals, Inc. for the Jardiance product family; and F. Hoffmann-La Roche Ltd and Genentech, Inc. for lebrikizumab, as well as license agreements with Almirall, S.A. for Ebglyss; and Chugai Pharmaceutical Co., Ltd for orforglipron. Eli Lilly and Company was founded in 1876 and is headquartered in Indianapolis, Indiana.
A 30% contraction in projected terminal margins coupled with a higher discount rate yields our bear-case fair value of $619.09.
Unprecedented efficacy and entrenched pipeline in incretin-based metabolic therapies.
Massive scale and expanding specialized manufacturing capacity (fill-finish).
Robust R&D flywheel yielding pipeline optionality in neurodegeneration and immunology.
Economic profit is supported when reported returns exceed the company cost-of-capital hurdle.
Unavailable
No FCF cliff sensitivity supplied.
If management raises forward guidance on GLP-1 manufacturing throughput, expect a rally toward the $1036.27 bull case. If capex guidance spikes without corresponding volume commitments, expect a re-rating toward the $587.43 discounted earnings base.
If management raises forward guidance on GLP-1 manufacturing throughput, expect a rally toward the $1036.27 bull case. If capex guidance spikes without corresponding volume commitments, expect a re-rating toward the $587.43 discounted earnings base.
High capital intensity phase. LLY is aggressively deploying capex ($10.8B in 2025) to scale global manufacturing footprints, establishing a high barrier to entry.
The metabolic disease space is in an early-stage supercycle. Massive TAM expansion via label expansions continues to redefine total addressable market parameters.
Payer pushback, formulary exclusion tactics, and legislative drug-pricing interventions could artificially compress cycle peaks.
High capital intensity phase. LLY is aggressively deploying capex ($10.8B in 2025) to scale global manufacturing footprints, establishing a high barrier to entry.
Trim exposure if the equity aggressively crosses the $1036.27 high-end threshold or if fundamental thesis deterioration (e.g., competing oral therapy approval) materializes.
Quantitative: DCF models indicate downside risk, with heavily weighted discounted earnings yielding $587.43.
Fundamental: Generational asset base, but priced for flawless execution.
Hold. We rate LLY as a Hold with a $821.95 price target. The company is a generational hyper-growth asset, but the -3.44% implied upside signals that peak commercial expectations are fully capitalized into the current $851.21 valuation.
Upside case: Technical: Trading below 50-day ($954.27) and 200-day ($909.39) moving averages indicates momentum stall. Downside case: Quantitative: DCF models indicate downside risk, with heavily weighted discounted earnings yielding $587.43.
Capture your own thesis, position size, and follow-up questions. Stays on this device, only you can see it.
Bear ($619.09): Efficacy plateaus, heavy competition fragments the market, and heavy capex suppresses terminal cash flows.
Emergence of oral small-molecule GLP-1s from competitors destroying injectable market share.
Severe legislative action capping gross-to-net pricing on obesity drugs.
Unforeseen long-term safety signals in chronic GLP-1 administration.
The five developments that would weaken our investment case.
Slowing product demand curbs overall corporate revenue momentum, signaling market saturation or competitive erosion and directly challenging high growth expectations underpinning the premium equity valuation.
Current:44.7% for the period ended 2025-12-31
Alert if<20.0% over any fiscal year
Mandatory price concessions or higher supply chain unit costs diminish gross profits, constraining the enterprise's ability to finance ongoing research pipelines and expand manufacturing capacity.
Current:83.0% for the period ended 2025-12-31
Alert if<80.0% over any fiscal year
Inadequate cash conversion relative to accounting net income reveals working capital friction or revenue quality issues, restricting organic cash flow necessary to fund capital outlays and maintain balance sheet flexibility.
Current:0.815 as of 2026-04-29
Escalating operating expenses or increased commercialization outlays erode operational leverage, compressing core margins and reducing profitability needed for strategic corporate growth initiatives.
Current:45.6% for the period ended 2025-12-31
Alert if<35.0% over any fiscal year
Declining return on invested capital highlights inefficient capital deployment and diminished competitive advantage across major therapeutic franchises, threatening long-term compound returns on shareholder equity.
Current:31.7% as of 2026-04-29
Alert if<20.0% over any trailing twelve-month period
Each lens answers a different valuation question. Only included lenses set Fair value; floors and diagnostics provide context.
Project SBC-adjusted EPS, discount each year's earnings at cost of equity, then add a Gordon-growth terminal value.
Under the moderate discount rate, $203 comes from forecast-period earnings and $365 from the long-term value, totaling $568.
Apply a terminal P/E to the dated forward EPS path, then discount that future share value back to the analysis date.
Convert the revenue and margin path into after-tax free cash flow, discount the annual per-share amounts and at , then adjust for signed per current share.
Add depreciation to net income, subtract maintenance capex, divide by diluted shares, and apply a normalized valuation multiple.
Multiply the peer median PEG by this stock's forecast growth to derive an implied forward P/E, then apply it to forward EPS.
Solve for the growth rate that makes the model value equal the report-date share price.
Bull ($1036.27): Near-monopoly pricing power holds, and capacity expansion perfectly meets inelastic global demand.
Base ($821.95): Continued hyper-growth, but normalized by gradual pricing pressure and duopoly market sharing.
If management raises forward guidance on GLP-1 manufacturing throughput, expect a rally toward the $1036.27 bull case. If capex guidance spikes without corresponding volume commitments, expect a re-rating toward the $587.43 discounted earnings base.
If management raises forward guidance on GLP-1 manufacturing throughput, expect a rally toward the $1036.27 bull case. If capex guidance spikes without corresponding volume commitments, expect a re-rating toward the $587.43 discounted earnings base.
Warning level: <20.0% over any fiscal year. Slowing product demand curbs overall corporate revenue momentum, signaling market saturation or competitive erosion and directly challenging high growth expectations underpinning the premium equity valuation.
Warning level: <80.0% over any fiscal year. Mandatory price concessions or higher supply chain unit costs diminish gross profits, constraining the enterprise's ability to finance ongoing research pipelines and expand manufacturing capacity.
Warning level: <0.700 over any trailing twelve-month period. Inadequate cash conversion relative to accounting net income reveals working capital friction or revenue quality issues, restricting organic cash flow necessary to fund capital outlays and maintain balance sheet flexibility.
Warning level: <35.0% over any fiscal year. Escalating operating expenses or increased commercialization outlays erode operational leverage, compressing core margins and reducing profitability needed for strategic corporate growth initiatives.
Warning level: <20.0% over any trailing twelve-month period. Declining return on invested capital highlights inefficient capital deployment and diminished competitive advantage across major therapeutic franchises, threatening long-term compound returns on shareholder equity.
| $28.32B |
| $28.54B |
| $34.12B |
| $45.04B |
| $65.18B |
| +23.2% |
| Gross profit | $21.01B | $21.91B | $27.04B | $36.63B | $54.13B | +26.7% |
| Operating income | $6.36B | $7.14B | $10.33B | $17.04B | $29.70B | +47.0% |
| Net income | $5.58B | $6.24B | $5.24B | $10.59B | $20.64B | +38.7% |
| EPS (diluted) | $6.14 | $6.57 | $5.80 | $11.71 | $22.95 | +39.0% |
| EBITDA | $7.90B | $8.66B | $11.85B | $18.81B | $31.69B | +41.5% |
| R&D | $7.90B | $7.19B | $9.31B | $10.99B | $13.34B | +14.0% |
| SG&A | $6.43B | $6.44B | $7.40B | $8.59B | $11.09B | +14.6% |
Capital allocation should be evaluated against reinvestment needs, balance-sheet strength, and shareholder returns.
| Revenue | 65,179,000,000 |
|---|---|
| Cost of revenue | 11,052,000,000 |
| Gross profit | 54,127,000,000 |
| Operating expenses | 24,431,000,000 |
| Operating income | 29,696,000,000 |
| Non-operating items and tax | -9,056,000,000 |
| Net income | 20,640,000,000 |
| Total assets | 112,476,000,000 |
|---|---|
| Cash | 7,268,000,000 |
| Current assets | 55,629,000,000 |
| Total liabilities | 85,941,000,000 |
| Current liabilities | 35,228,000,000 |
| Shareholders’ equity | 26,535,000,000 |
Point-in-time financial data used in the 2026-04-29 analysis.
| Period | Revenue | EBITDA | Net income | Operating cash flow | Free cash flow | Capex | Depreciation and amortization | Stock-based compensation | Share repurchases | Dividends paid | Net debt issuance | Investing cash flow | Financing cash flow | Beginning cash | Ending cash | Cash and investments | Total debt | Operating margin | ROIC | WACC | ROIC − WACC spread |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021-12-31 | 28.3B | 7.9B | 5.6B | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 22.4% | — | — | — |
| 2022-12-31 | 28.5B | 8.7B | 6.2B | 7.6B | 4.6B | 3B | 1.5B | 371.1M | 1.5B | 3.5B | -62M | — | — | — | — | 2.2B | 16.2B | 29.0% | — | — | — |
| 2023-12-31 | 34.1B | 11.9B | 5.2B | 4.2B | -3.2B | 7.4B | 1.5B | 629M | 750M | 4.1B | 8.7B | — | — | — | — | 2.9B | 25.2B | 30.3% | — | 6.8% | — |
| 2024-12-31 | 45B | 18.8B | 10.6B | 8.8B | 414M | 8.4B | 1.8B | 646M | 2.5B | 4.7B | 8.9B | — | — | — | — | 3.3B | 33.6B | 37.8% | — | 7.9% | — |
| 2025-12-31 | 65.2B | 31.7B | 20.6B | 16.8B | 6B | 10.8B | 2B | 626M | 4.1B | 5.4B | 8.1B | — | — | — | — | 7.3B | 42.5B | 45.6% | — | 7.9% | — |
LLY trades at 20.2x forward earnings against a peer median of 13.4x; EV/EBITDA of 25.8x against a peer median of 13.8x; 6 peers.
Alert if<0.700 over any trailing twelve-month period
| AbbVie Inc. |
| 12.3x |
| 5.7x |
| 14.1x |
| 62.2% |
| 34.1% |
| MRK | Merck & Co. Inc. | 11.3x | 4.2x | 10.6x | 36.9% | 32.8% |
| AMGN | Amgen Inc. | 14.5x | 5.0x | 13.8x | 106.1% | 30.5% |
| GILD | Gilead Sciences Inc. | 13.4x | 5.4x | 12.1x | 40.7% | 37.4% |
