Drugmaker Eli Lilly (LLY) grabbed attention on Monday when Deutsche Bank upgraded its stock from Hold to Buy while increasing the price target from $725 to $1,025 per share. Indeed, analyst James Shin called the company a “high-growth unicorn” after its strong Q2 results. Interestingly, though, shares dipped slightly at the time of writing.
Still, Eli Lilly boosted its full-year forecast thanks to better-than-expected sales of its diabetes and weight loss drugs, Mounjaro and Zepbound, along with some help from its breast cancer drug, Verzenio.
Shin mentioned that the earnings win “helped settle some nerves in a volatile market,” which should set the stock up for solid performance due to its “high growth outlook and low risk.” Indeed, Mounjaro’s sales outside the U.S. are expected to become a big revenue driver.
However, the analyst warned that he sees more competition coming, and he’s probably not the only one who views this as a concern. According to TipRanks’ Bulls Say, Bears Say tool, one of the bearish concerns is Roche’s (RHHBY) CT-996 drug, which is an oral GLP-1 that could be a major challenger. Nevertheless, the bulls note that demand for this drug class remains high, so it’s possible that all companies will benefit as the overall market continues to grow.
Is LLY a Good Stock to Buy Now?
Overall, analysts remain bullish on LLY stock, with a Strong Buy consensus rating based on 15 Buys and three Holds. Over the past year, LLY has increased by more than 65%, and the average LLY price target of $1,000.69 per share implies an upside potential of 13.14% from current levels.
