Eli Lilly & Co. (NYSE:LLY) ‘s remarkable surge in stock value has prompted analysts at Morgan Stanley to ponder whether it could become the first non-Magnificent Seven US company to achieve a market value of $1 trillion.
In a note to clients, Morgan Stanley analysts, including Terence Flynn, raised their price target on the weight-loss drugmaker to the highest on Wall Street. Bloomberg calculations suggest this target would push the company’s market capitalization to around $900 billion.
Analysts are pondering whether Lilly could potentially be the first biopharma stock to reach the $1 trillion mark, highlighting their sustained confidence in the company’s growth prospects.
Shares of Eli Lilly climbed as much as 2.1% on Friday to hit a new record high. The stock has surged by 32% this year, largely driven by strong demand for its Mounjaro and Zepbound drugs for diabetes and obesity. This surge has propelled Lilly’s market capitalization to nearly $730 billion, ranking it among the top 10 most valuable companies in the S&P 500 Index.
Last month, Eli Lilly and Company’s market value exceeded that of Tesla Inc., a shift attributed to disappointing earnings and growth apprehensions surrounding the electric car manufacturer. Tesla, which achieved the significant $1 trillion milestone in 2021, has subsequently departed from this exclusive cohort. Presently, the esteemed $1 trillion-plus club comprises entities like Microsoft Corp., Apple Inc., Nvidia Corp., Alphabet Inc., Amazon.com Inc., and Meta Platforms Inc. Notably among non-tech firms, Berkshire Hathaway Inc. stands as the sole company boasting a higher market capitalization than Eli Lilly and Company.
Several analysts have raised their price targets on Lilly this month, buoyed by positive earnings results. However, some analysts believe that the market may have already priced in this optimism, as Lilly shares closed at $757.78 on Thursday, just slightly above the average analyst price target of $756.14.
Lilly’s blockbuster diabetes drug Mounjaro is widely used off-label for weight loss, while Zepbound, recently approved for weight loss, is anticipated to become the best-selling drug in history.
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