Can Mounjaro and Zepbound Drive Another Strong Quarter for Eli Lilly?

Core Insights - Demand for Eli Lilly's GLP-1 medicines, Mounjaro and Zepbound, remains robust, generating $6.15 billion in Q1 2025, accounting for approximately 48% of total revenues [1][8] - Sales of Mounjaro and Zepbound rebounded in Q1 2025 due to new international market launches and improved supply, despite lower-than-expected sales in the second half of 2024 [2][8] - The company anticipates Q2 2025 sales of $4.5 billion for Mounjaro and $3.1 billion for Zepbound, driven by deeper market penetration [3][8] Company Performance - Eli Lilly's broader portfolio, including oncology and immunology drugs, continues to show steady growth, with contributions from recently launched products [4] - The company's shares have outperformed the industry year-to-date, indicating strong market performance [7] Industry Context - The U.S. obesity market is projected to reach $100 billion by 2030, with Eli Lilly and Novo Nordisk as the primary competitors [5] - Novo Nordisk's semaglutide medicines, Ozempic and Wegovy, compete directly with Lilly's offerings, contributing significantly to Novo's revenues [5] - Other companies, such as Viking Therapeutics, are also advancing in the obesity space with new investigational drugs [6] Valuation and Estimates - Eli Lilly's shares are currently trading at a P/E ratio of 29.66, above the industry average of 15.16, but below its five-year mean of 34.54 [10] - The bottom-line estimate for 2025 remains at $21.92, while the estimate for 2026 has slightly decreased from $30.91 to $30.84 [11]