Eli Lilly Stock Could Soar to $1,150, According to a Wall Street Analyst. Is It a Buy at Around $945?

Core Viewpoint - Eli Lilly's stock has increased by approximately 58% in 2024, with analysts believing there is potential for further growth, particularly due to the success of its drug tirzepatide [1] Group 1: Drug Performance - Tirzepatide, marketed as Mounjaro and Zepbound, has gained significant attention, with Q2 2024 sales reaching $4.3 billion, a 342% increase from $980 million in Q2 2023 [3] - In comparison, Novo Nordisk's semaglutide generated $6.9 billion in Q2 2024, reflecting a 26% year-over-year growth [3] - Tirzepatide's sales in Q2 2024 were 86% higher than in Q1 2024, indicating rapid market adoption [3] Group 2: Clinical Evidence and Growth Drivers - Clinical trials have shown that tirzepatide significantly reduces the risk of progressing to type 2 diabetes by 94% in pre-diabetic adults compared to placebo [4] - The drug has also demonstrated benefits for patients with obstructive sleep apnea and heart failure, reducing dangerous heart failure outcomes by 38% [4] - Tirzepatide currently accounts for 38% of Eli Lilly's total sales, with additional growth expected from the recently FDA-approved Kisunla for Alzheimer's disease [5] Group 3: Market Expectations and Valuation - Analysts project that tirzepatide could boost annual sales from $17.2 billion to over $50 billion at its peak, although the stock is currently trading at about 60 times forward-looking earnings expectations [6] - The potential for significant growth exists, but the market has already priced in high expectations, leading to concerns about valuation if unforeseen complications arise [7]