Core Viewpoint - The healthcare sector is anticipated to potentially rebound in 2026, with several attractive stocks identified for investment, including AbbVie, Eli Lilly, and Intuitive Surgical. AbbVie - AbbVie is recognized as a reliable dividend payer, boasting 54 consecutive payout increases, qualifying it as a Dividend King [3] - The company reported third-quarter revenue of $15.8 billion, reflecting a 9% increase year-over-year [4] - AbbVie's product portfolio includes key drugs such as Vraylar, Botox Therapeutics, Qulipta, Skyrizi, and Rinvoq, which are expected to drive future growth [6][8] - Skyrizi is projected to become the second best-selling drug globally by 2030, with estimated sales of $26.6 billion [7] Eli Lilly - Eli Lilly's third-quarter revenue reached $17.6 billion, marking a significant 54% year-over-year growth [9] - The company is leveraging tirzepatide, marketed as Zepbound and Mounjaro, to sustain its growth trajectory, alongside promising pipeline candidates like orforglipron [10] - Eli Lilly is diversifying its portfolio, with recent launches in oncology, including Jaypirca for mantle cell lymphoma and Inluriyo for breast cancer [13] - The company's strategic investments in artificial intelligence and other therapeutic areas position it favorably for future growth [14] Intuitive Surgical - Intuitive Surgical faces challenges from tariffs and increased competition, particularly from Medtronic's Hugo system [15] - Despite these challenges, the company maintains a strong economic moat with 10,763 da Vinci systems installed, which creates high switching costs for customers [16] - The da Vinci system has over two decades of clinical evidence supporting its effectiveness, allowing Intuitive Surgical to command significant pricing power [18] - The company is expected to benefit from label expansions and increased procedure volumes, which will enhance revenue and margins over time [19]

Core Viewpoint - Eli Lilly's stock has shown remarkable performance over the past five years, increasing by 530%, but its current valuation at 27 times forward earnings raises questions about its attractiveness as an investment [1][4]. Valuation Metrics - The forward price-to-earnings ratio (P/E) is a popular metric, but it does not account for growth, which is essential for evaluating a stock's true value [4]. - The price/earnings-to-growth ratio (PEG) for Eli Lilly is estimated at 0.9, indicating that the stock is undervalued, as a PEG of 1 or below is considered cheap [5][7]. Financial Performance - Eli Lilly has a market capitalization of $954 billion, with a gross margin of 83.03% and a dividend yield of 0.59% [6][7]. - The company has experienced rapid revenue and earnings growth, positioning itself as a leader in the anti-obesity medicine market with its product Zepbound [7][8]. Competitive Landscape - While increased competition is a concern, Eli Lilly's clinical trial results are favorable compared to industry peers, suggesting strong medium-term prospects [8]. - Analysts predict continued strong growth in both revenue and earnings through the end of the decade, justifying the current forward P/E ratio [8]. Product Pipeline and Market Expansion - Eli Lilly has made significant advancements in oncology and immunology, with successful products like Verzenio and Taltz, and new launches such as Jaypirca and Omvoh [9][10]. - The company's robust business model is expected to drive market-beating returns in the coming years [10].

Core Insights - Eli Lilly and Company's stock reached $1000 per share for the first time on November 12, indicating strong market performance and nearing a $1 trillion market cap, primarily driven by the success of GLP-1 drugs like Mounjaro and Zepbound [1][8] Drug Approvals and Revenue Contributions - Lilly has received approvals for several new drugs, including Omvoh, Jaypirca, Ebglyss, and Kisunla, which are contributing to revenue growth alongside GLP-1 drugs [2][5] - In the first nine months of 2025, Omvoh generated $176.9 million, while Ebglyss, Kisunla, and Jaypirca contributed $274.1 million, $140.6 million, and $358.2 million, respectively, totaling $950 million from these new drugs [3][10] Ongoing Studies and Future Potential - New drugs are being evaluated for additional indications, with Ebglyss in phase III trials for chronic rhinosinusitis and Jaypirca being studied for broader use in CLL and MCL [4][8] - Lilly anticipates launching new drugs in the fourth quarter of 2025 and throughout 2026, which will further enhance revenue [5][8] M&A Strategy - To diversify its portfolio beyond GLP-1 drugs, Lilly is pursuing M&A opportunities in cardiovascular, oncology, and neuroscience sectors, including the acquisition of Verve Therapeutics and Adverum Biotechnologies [6][7] Competitive Landscape - Omvoh faces competition from AbbVie’s and J&J’s products, while Kisunla competes with Eisai/Biogen's Leqembi, and Jaypirca competes with older BTK inhibitors [9][11] Stock Performance and Valuation - Lilly's stock has increased by 35.8% this year, outperforming the industry average of 14.4% [12] - The stock trades at a price/earnings ratio of 33.83, significantly higher than the industry average of 16.84, but below its 5-year mean of 34.54 [14] Earnings Estimates - The Zacks Consensus Estimate for 2025 earnings per share has risen from $22.94 to $23.78, and for 2026 from $30.79 to $32.06 over the past 30 days [16]

Core Insights - Eli Lilly and Company (LLY) reported third-quarter 2025 adjusted earnings per share (EPS) of $7.02, exceeding the Zacks Consensus Estimate of $6.02 per share, and significantly up from $1.18 per share in the same quarter last year [1][9] - Revenues reached $17.60 billion, a 54% increase year over year, driven by strong sales of GLP-1 drugs, Mounjaro and Zepbound, surpassing the Zacks Consensus Estimate of $16.01 billion [2][9] Revenue and Sales Performance - Mounjaro sales were $6.52 billion, up 109% year over year, beating the Zacks Consensus Estimate of $5.48 billion [3] - Zepbound recorded sales of $3.59 billion, a 185% increase year over year, exceeding the Zacks Consensus Estimate of $3.45 billion [4] - Trulicity generated revenues of $1.05 billion, down 19% year over year, in line with estimates [6] - Jardiance sales rose 40% to $959 million, surpassing the Zacks Consensus Estimate of $687 million [6] - Taltz brought in sales of $901.5 million, up 2% year over year, but missed the Zacks Consensus Estimate [7] - Verzenio generated sales of $1.47 billion, up 7% year over year, but also missed estimates [7] - Emgality revenues were $175.7 million, down 13% year over year, while Olumiant sales were $268.9 million, up 7% [8] Market Dynamics and Competition - Mounjaro and Zepbound are gaining market share from Novo Nordisk's Ozempic and Wegovy, despite facing strong competition [5] - The company is investing in obesity treatments and has several new molecules in clinical development, including orforglipron and retatrutide [14] Guidance and Future Outlook - Lilly raised its 2025 revenue guidance to $63.0 billion to $63.5 billion, up from a previous range of $60.0 billion to $62.0 billion, and increased EPS guidance to $23.00 to $23.70 [11][13] - The company is expanding its portfolio beyond GLP-1 drugs into cardiovascular, oncology, and neuroscience areas, with recent acquisitions to enhance its pipeline [17][18] Stock Performance - Following the strong third-quarter results and guidance increase, Lilly's shares rose more than 5% in pre-market trading, with a year-to-date increase of 5.3% compared to the industry average of 3.3% [13]

Financial Performance - Total revenue reached $17601 million, a 54% increase compared to Q3 2024[12, 17] - Key product revenue grew by 104%, reaching $12 billion[12] - Non-GAAP earnings per share (EPS) increased by $584 to $702[12] - The company raised the midpoint of full-year revenue guidance by over $2 billion[10] Product Highlights - Lilly's U S incretin analogs market share increased to 579% of total prescriptions, with market growth of 36% versus prior year[10, 26] - Mounjaro U S sales were $36 billion, and international sales were $30 billion[56] - Zepbound U S sales were $36 billion, and international sales were $20 million[59] - Verzenio U S sales were $880 million, and international sales were $590 million[62] - Jaypirca Q3 2025 sales were $143 million, with U S TRx increasing 61% vs Q3 2024[24] - Ebglyss Q3 2025 sales were $127 million, with U S TRx growing 41% vs Q2 2025[24] - Omvoh Q3 2025 sales were $65 million[24] - Kisunla Q3 2025 sales were $70 million[24] Strategic Investments - Year-to-date capital investments totaled $53 billion[12] - Research & Development investment was $35 billion, representing 27% of revenue[12] - Marketing, selling & administrative expenses were $27 billion, a 31% increase[12] - $13 billion was distributed via dividends and $07 billion in share repurchases[14] Regulatory and Clinical Updates - Inluriyo (imlunestrant) received U S FDA approval for ER+, HER2-, ESR1-mutated advanced or metastatic breast cancer[11] - Kisunla received marketing authorization in Europe for early symptomatic Alzheimer's disease[11] - Orforglipron showed positive results in four additional Phase 3 trials[11] - Jaypirca significantly improved progression-free survival in treatment-naïve CLL/SLL[11]

Core Insights - The third-quarter 2025 reporting cycle for the Medical sector is commencing, with major firms expected to release earnings results in the coming weeks, particularly in pharma/biotech and medical devices [1] - Johnson & Johnson has set a positive tone for the earnings season by exceeding estimates and raising its sales expectations for 2025 [1] - Roche has reported solid growth in the first nine months of 2025, driven by high demand for key drugs, leading to an upward revision of its earnings per share growth expectations for 2025 [2] Earnings Trends - As of October 22, 13.3% of Medical sector companies, representing 26.8% of the sector's market capitalization, have reported earnings, with 87.5% exceeding earnings estimates and the same percentage surpassing revenue expectations [3] - Year-over-year earnings increased by 7.4%, while revenues rose by 9.8%. However, third-quarter earnings for the Medical sector are projected to decrease by 4.3%, with sales expected to rise by 8.1% compared to the previous year [3] Company Performance Expectations - Eli Lilly is expected to report strong results driven by demand for GLP-1 drugs and other oncology and immunology products, with a consensus estimate of $16.01 billion in sales and $6.02 per share in earnings [7][8] - Merck is anticipated to see growth from its cancer drug Keytruda, with estimates of $17.06 billion in sales and $2.36 per share in earnings [12] - AbbVie is projected to benefit from sales of Rinvoq, Skyrizi, and newer drugs, with estimates of $15.59 billion in sales and $1.80 per share in earnings [13][14] - Bristol Myers is expected to report revenues influenced by growth portfolio sales, with estimates of $11.83 billion in sales and $1.51 per share in earnings [15][16] - Gilead Sciences is likely to see revenue support from its HIV therapies, with estimates of $7.46 billion in sales and $2.15 per share in earnings, although impacted by changes in Medicare Part D [19][20]

Core Insights - Eli Lilly (LLY) is a market leader in the GLP-1 segment with its tirzepatide medicines Mounjaro and Zepbound, while also generating significant revenue from its oncology franchise, which accounted for over 15% of its first-half 2025 revenues, growing approximately 10% year over year [1] Oncology Sales Performance - The oncology unit's sales for Q3 2025 are estimated at $2.58 billion, reflecting over 15% year-over-year growth, primarily driven by the blockbuster breast cancer drug Verzenio, which saw increased demand and higher prices, despite currency headwinds and competitive pressures [2][9] - Sales from RET inhibitor Retevmo and lymphoma drug Jaypirca are expected to positively contribute to growth, although this may be partially offset by declining sales of older drugs like Alimta and Cyramza due to competition from immuno-oncology agents [3] New Drug Launch - Eli Lilly received FDA approval for its new breast cancer drug Inluriyo in late September, but the launch is expected to occur in the coming weeks, meaning no sales contribution from this drug in Q3 [4] Market Dynamics - Attention is shifting towards Lilly's oncology unit, which is demonstrating consistent double-digit growth, potentially reassuring investors that the company's earnings are not solely reliant on the obesity segment ahead of Q3 results on October 30 [5] Competitive Landscape - Major competitors in the oncology space include AstraZeneca, Merck, and Pfizer, with AstraZeneca's oncology sales accounting for nearly 43% of total revenues and growing 11% in the first half of 2025, driven by drugs like Tagrisso and Lynparza [6] - Merck's Keytruda accounted for over 48% of its total revenues in the first half of 2025, while Pfizer's oncology revenues grew 9% operationally, driven by drugs like Xtandi and Lorbrena [7] Valuation and Estimates - Eli Lilly's shares are currently trading at a price/earnings (P/E) ratio of 27.99, which is higher than the industry average of 15.56 but below its five-year mean of 34.54 [10] - EPS estimates for 2025 have decreased from $23.15 to $22.86, and for 2026 from $30.82 to $30.78 over the past 30 days [12]

Core Insights - Eli Lilly and Company's stock has increased by 9.5% in a month, driven by a recovery in the pharma sector, with major players like Pfizer and AstraZeneca entering drug pricing agreements with the Trump administration [1][2][11] Company Performance - Lilly's top line is significantly supported by the strong growth of its diabetes and obesity treatments, particularly the GLP-1 therapies Mounjaro and Zepbound, which together account for approximately 50% of the company's total revenues [4][5][11] - The company has committed over $50 billion for domestic manufacturing expansion, positioning itself for potential agreements with the U.S. government similar to those signed by Pfizer and AstraZeneca [2][11] Product Pipeline - Lilly is actively investing in its obesity pipeline, with several new molecules in clinical development, including orforglipron and retatrutide, which are expected to enhance its market position [7][8][9] - The company has received approvals for multiple new therapies, including Omvoh, Jaypirca, Ebglyss, and Kisunla, contributing to revenue growth [12][13] Market Dynamics - The obesity market is projected to reach $100 billion by 2030, leading to increased competition, particularly from Novo Nordisk, which poses a challenge for Lilly's Mounjaro and Zepbound [14][18] - U.S. President Trump's indication of potential price cuts for GLP-1 drugs raises concerns about pricing pressures on Lilly's products, although formal negotiations have not yet begun [15][16] Financial Outlook - Lilly's stock is currently trading at a price/earnings ratio of 27.72, higher than the industry average of 15.54, but below its five-year mean of 34.54 [23][29] - The company anticipates revenues between $60 billion and $62 billion in 2025, reflecting a year-over-year growth of over 30% [29]

Core Insights - Eli Lilly and Company (LLY) has significantly increased its market value over the past 2-3 years, primarily due to the success of its GLP-1 drugs, Mounjaro for type II diabetes and Zepbound for obesity [1] Drug Approvals and Revenue Contributions - Lilly has received approvals for several new drugs, including Omvoh for ulcerative colitis and Crohn's disease, Jaypirca for mantle cell lymphoma and chronic lymphocytic leukemia, Ebglyss for atopic dermatitis, and Kisunla for early symptomatic Alzheimer's disease, all contributing to revenue growth [2] - In the first half of 2025, Omvoh generated $111.9 million, while Ebglyss, Kisunla, and Jaypirca contributed $147.1 million, $70.1 million, and $215.3 million, respectively [3] Future Growth Potential - These drugs are being evaluated for additional indications and label expansions, with Ebglyss in phase III trials for perennial allergens and chronic rhinosinusitis, and Jaypirca being studied for earlier lines of therapy [4] - Lilly anticipates that Omvoh, Ebglyss, Kisunla, and Jaypirca will continue to drive revenue growth in the second half of 2025 [5] Upcoming Drug Approvals - A new drug, imlunestrant, is under review for treating ER+HER2-metastatic breast cancer in the US and EU [6] Competitive Landscape - Omvoh faces competition from AbbVie's Humira, Skyrizi, and Rinvoq, as well as J&J's Stelara, while Kisunla competes with Eisai/Biogen's Leqembi [7][8] - Jaypirca competes with older BTK inhibitors like Imbruvica and Calquence, and Ebglyss faces competition from Dupixent [9] Stock Performance and Valuation - Lilly's stock has declined by 4.6% this year, contrasting with a 1.3% increase in the industry [10] - The combined revenue from Omvoh, Ebglyss, Kisunla, and Jaypirca exceeded $540 million in H1 2025, with EPS estimates for 2025 and 2026 rising to $22.97 and $30.95, respectively [11] - Lilly's stock is currently trading at a price/earnings ratio of 25.87, higher than the industry average of 14.78, but below its 5-year mean of 34.54 [13] Consensus Estimates - The Zacks Consensus Estimate for 2025 EPS has increased from $22.04 to $22.97 over the past 30 days, while the estimate for 2026 has risen from $30.88 to $30.95 [14]

Financial Performance - Total revenue reached $15.6 billion, a 38% increase compared to Q2 2024[12] - Key product revenue grew by 80% to $10.4 billion[12] - Non-GAAP earnings per share (EPS) increased by 61% to $6.31[12] - The company raised the midpoint of its revenue guidance by $1.5 billion for the full year[10] Product Performance - Lilly's U.S. incretin analogs market share increased to 57.0% of total prescriptions, with the market growing 41% year-over-year[10] - Mounjaro U.S. sales were $3.3 billion and international sales were $1.9 billion[65] - Zepbound U.S. sales were $3.4 billion and international sales were $1.5 million[68] - Verzenio U.S. sales increased 8% and international sales increased 19%[71] - Jaypirca Q2 2025 sales reached $123 million, with TRx increasing 85% compared to Q2 2024[25] Clinical Development - Orforglipron delivered weight loss of more than 27 lbs (12.4%) in ATTAIN-1[16] - Mounjaro demonstrated cardiovascular protection in SURPASS-CVOT, showing an 8% lower rate of MACE-3 events compared to Trulicity[16, 43]