This article first appeared on GuruFocus.
Eli Lilly (NYSE:LLY), the pharmaceutical powerhouse behind Mounjaro and Zepbound, jumped approximately 2.6% to $1,213.76 Tuesday morning as investors searched for earnings growth outside pressured technology stocks. With its market capitalization climbing above $1.08 trillion, Lilly is proving that healthcare can still command investor attention when growth remains tangible.
The reason is simple: Lilly’s obesity franchise has become one of the most powerful growth engines in global healthcare. Second-quarter revenue surged 48% to $23 billion, while adjusted earnings climbed 33% to $8.38 per share. Mounjaro delivered $9.9 billion in sales, up 91% year over year, while Zepbound added $4.9 billion as demand for weight-loss treatments continued accelerating. Together, the two medicines generated roughly 64% of quarterly revenue, showing just how important the obesity opportunity has become for Lilly’s future.
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The GuruFocus valuation picture adds another layer to the story. The GF Value chart shows Lilly trading around $1,219 per share versus an estimated intrinsic value of approximately $1,510, suggesting the stock sits about 19.4% below its calculated fair value. The market is paying a premium for Lilly’s growth, but investors appear to be betting that today’s blockbuster drugs can become tomorrow’s healthcare empire. The challenge is concentration: two medicines now carry a huge portion of the company’s growth story, leaving Lilly needing continued prescription momentum, pricing power, and successful pipeline execution to justify its trillion-dollar valuation.