Eli Lilly
has risen nearly 140% over the last 12 months but a
Morgan Stanley
analyst sees more upside for the drugmaker, prompting the analyst to ask if the stock can reach a market value of $1 trillion.
Analyst Terence Flynn raised his price target on
Eli Lilly
to $950 from $805 and maintained an Overweight rating on the stock. The new price target implies a 25% increase from the stock’s closing price on Thursday.
“Could LLY be the first $1 trillion biopharma stock?” Flynn asked in a research note. In midday trading Friday, Lilly was on track to close with a market capitalization of $749.2 billion, which would be its highest on record. The gains would make Lilly the eighth-highest valued stock in the
S&P 500,
topping companies such as
Tesla,
Advanced Micro Devices,
and
Netflix.
Shares of Lilly were rising 4.1% to $788.58 Friday and were on track for a record high.
To hit $1 trillion, the stock would have to reach $1,053.40, according to Dow Jones Market Data. But following a strong fourth-quarter earnings report last week, the idea of a pharmaceutical stock hitting a market cap usually only held by tech giants seems possible.
Lilly reported fourth-quarter revenue of $9.35 billion last week, beating Wall Street estimates of $8.95 billion and jumping from $7.3 billion in the same period the year before.
“We continue to see a path for further upside,” Flynn wrote. His bullish view on the stock along with a new price target come as Lilly shares have surged over the last year on investor excitement surrounding the increased demand for obesity and diabetes drugs.
Sales of Lilly’s obesity medicine Zepbound, which became available in December, were $175.8 million, above analysts’ estimates of $75 million. Revenue for diabetes drug Mounjaro was $2.2 billion, above the consensus call of $1.73 billion.
Write to Angela Palumbo at angela.palumbo@dowjones.com
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