Blockbuster sales of its flagship GLP-1 treatments have propelled Eli Lilly And Co.‘s (NYSE:LLY) first-quarter earnings, prompting a prominent Wall Street analyst to defend the stock’s valuation and highlight the disruptive potential of its new oral weight-loss drug.
Fueling The ‘Love Affair’
Eli Lilly's revenue skyrocketed 56% year-over-year to $19.8 billion during its first-quarter 2026, driven primarily by the astronomical volume demand for its metabolic and weight-management medications.
Following the earnings release, Gary Black, Managing Partner of The Future Fund, noted on X that Eli Lilly continues to heavily capitalize on consumers' ongoing “love affair” with GLP-1 drugs.
The financial results reflect this devotion: worldwide revenue for the diabetes drug Mounjaro surged over 120% year-over-year to $8.7 billion, while the obesity treatment Zepbound brought in nearly $4.2 billion, an 80% year-over-year increase.
The ‘Biggest Drug Yet’
Fueled by this strong underlying performance, Eli Lilly confidently raised its full-year 2026 revenue guidance by $2 billion, now projecting a range between $82 billion and $85 billion.
However, the company's growth narrative isn’t resting solely on its current blockbuster lineup. Black highlighted the recent U.S. FDA approval of Foundayo, Eli Lilly’s new once-daily oral weight-loss pill.
Priced aggressively at $149 per month, Black suggested that the highly scalable pill “could be its biggest drug yet,” as it removes the food and water restrictions associated with existing oral options and widely expands the accessible market.
‘Compelling’ Valuation
Prior to the earnings report, some analysts had begun questioning Eli Lilly’s ability to maintain its rapid expansion amid falling realized drug prices and rising political pressure to limit drug costs.
Yet, the first-quarter earnings blowout has forcefully shifted the narrative back in the company’s favor. Despite the recent market volatility, Black maintains a highly optimistic outlook on the stock’s future.
Factoring in a 2026 price-to-earnings ratio of 27x, alongside a projected 15% long-term revenue growth and 20% long-term earnings per share growth, Black firmly concluded that Eli Lilly’s valuation “still looks compelling.”
LLY Soars After Q1 But Still Underperforms In 2026
LLY stock has declined by 13.03% year-to-date, while the S&P 500 index advanced 5.11% over the same period. Furthermore, the stock was up by 10.67% in the last six months and 3.97% over the year.
The stock closed Thursday 9.80% higher at $934.60 apiece, after declaring its first-quarter results. Benzinga’s Edge Stock Rankings indicate that LLY maintains a weak price trend in the short, medium, and long terms, with a poor value ranking.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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