Lilly’s Little Fortune

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One does rather tire of hearing about pharmaceutical successes, doesn’t one? Still, even a hardened cynic must concede that Eli Lilly (LLY +3.53%) has been having a positively ripping good time of late. The share price, as you may have noticed, has been performing a most agreeable little dance, up over 30% in the last year. Apparently, people are rather keen to shed a few pounds, and Lilly, it seems, is obligingly providing the means. A most profitable arrangement, wouldn’t you say?

Let’s briefly examine the details, shall we? It’s never wise to be entirely swept away by enthusiasm, however justified.

A Most Satisfactory Surge

The source of all this merriment, naturally, is their GLP-1 business. Mounjaro, a name that sounds suspiciously like a tropical cocktail, surged by 110% in the last quarter to $7.4 billion. Zepbound, equally evocative, managed a respectable 123% jump to $4.3 billion. Even Verzenio, treating breast cancer, contributed a modest 3% increase to $1.6 billion. One suspects the weight-loss drugs are doing the heavy lifting, but a profit is a profit, regardless of its origins.

Both Mounjaro and Zepbound, it appears, contain the same active ingredient – tirzepatide – which is, frankly, a rather unglamorous name. The FDA has, with its usual bureaucratic precision, approved them for slightly different purposes. Mounjaro tackles blood glucose levels in those afflicted with type 2 diabetes, while Zepbound addresses the more fashionable ailment of obesity. Naturally, both are being cheerfully prescribed ‘off-label’ for simple weight loss. One suspects the company isn’t entirely displeased with this arrangement.

Overall, Lilly managed a 43% increase in quarterly revenue to $19.29 billion, with adjusted earnings per share jumping 42% to $7.54. The analysts, those ever-optimistic souls, had predicted $6.67 on sales of $17.96 billion. A rather comfortable margin, wouldn’t you agree?

Looking ahead, the company anticipates revenue between $80 and $83 billion in 2026, a 25% increase. Adjusted EPS is projected to range from $33.50 to $35. The consensus, rather predictably, was slightly lower, at $33.23 on sales of $77.72 billion. One begins to suspect a rather good run is underway.

This optimistic outlook, naturally, hinges on continued demand for Mounjaro and Zepbound, potentially boosted by Medicare coverage later this year. And, of course, the impending arrival of orforglipron, their next blockbuster, slated for obesity approval in the second quarter.

Now, orforglipron is a pill, taken orally. A decidedly civilized method of administration, wouldn’t you say? No messy injections required. No need for specialized pens or refrigerated transport. It can be ramped up much more quickly than its injectable predecessors. One suspects this is a rather clever move. A touch of practicality amidst all the pharmaceutical fanfare.

A Calculated Risk?

Lilly, it seems, has established itself as a dominant player in the GLP-1 weight-loss market. The approval of orforglipron should, predictably, provide a further boost. The drug will be launched in the U.S. this year, with broader international rollout in 2027.

The stock currently trades at a forward price-to-earnings ratio of 33 times 2026 estimates, falling to below 27 times based on 2027 consensus. Given the company’s robust GLP-1 growth and the potential of orforglipron, I suspect the momentum can continue. It’s not entirely irrational to consider acquiring a position, though one should always exercise a degree of caution. After all, even the most promising fortunes can, with alarming speed, become tiresome disappointments.

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2026-02-08 19:14