TLDR
- Eli Lilly became the first pharmaceutical company to reach $1 trillion market value, with shares hitting an all-time high of $1,060
- The stock has climbed more than 35% this year, driven by strong demand for weight-loss medications
- Obesity and diabetes drugs generated over $10.09 billion in revenue last quarter, accounting for more than half of the company’s $17.6 billion total revenue
- Speculation is growing about a potential stock split, with shares trading above $1,000 and the last split occurring in October 1997
- Wall Street analysts maintain a Strong Buy rating with 18 Buy and two Hold recommendations
Eli Lilly crossed a historic threshold on Friday, becoming the first pharmaceutical company to achieve a $1 trillion market valuation. Shares briefly touched $1,060, marking a new all-time high for the Indianapolis-based drugmaker.
The company now sits in an exclusive club traditionally dominated by technology companies. This year alone, LLY stock has climbed more than 35%.
The surge has been fueled primarily by the expanding weight-loss drug market. Obesity treatments have become one of the most profitable areas in healthcare.
Demand for these medications continues to grow steadily. Eli Lilly’s obesity and diabetes portfolio generated combined revenue of more than $10.09 billion in the most recent quarter.
That figure represented over half of the company’s total quarterly revenue of $17.6 billion. The weight-loss segment has essentially carried the company’s growth story this year.
Stock Split Speculation Builds
With shares trading above $1,000, talk of a potential stock split is intensifying. The last time Eli Lilly split its stock was October 1997, nearly 30 years ago.
Netflix recently executed a 10-for-1 stock split, reigniting discussions about other high-priced stocks. A stock split doesn’t change a company’s value or shareholder equity, but it does lower the share price.
The lower price point makes shares more accessible to retail investors. Eli Lilly has split its stock four times in its history.
Wall Street’s Take
The stock currently trades at 51 times future earnings estimates. That’s a rich valuation by most standards, but analysts remain bullish.
Among 20 Wall Street analysts covering the stock, 18 have Buy ratings and two have Hold ratings. The consensus is a Strong Buy recommendation.
The average price target stands at $1,042.89. That suggests shares are fairly valued at current levels, with minimal downside expected.
Other major companies have executed stock splits during bull markets. Apple, Nvidia, Broadcom, and Chipotle Mexican Grill all split their shares in recent years.
Eli Lilly’s market cap now sits just under $1 trillion. The company trades with the ticker symbol LLY on the New York Stock Exchange.
The pharmaceutical giant has joined an elite group of corporations. Very few companies ever reach the trillion-dollar milestone.
Shares are currently trading at $1,054.12. That price point puts LLY stock well above levels seen just a year ago.
The obesity drug market shows no signs of slowing down. Healthcare analysts expect continued growth in this treatment category.
Eli Lilly’s latest quarterly results showed the strength of its diabetes and obesity franchise. More than half the company’s revenue now comes from these two therapeutic areas.
The drugmaker reported $17.6 billion in total revenue for the quarter. The obesity and diabetes segment alone accounted for $10.09 billion of that total.
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