Key Takeaways
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Eli Lilly closed Friday worth $1.27 trillion, about 10% short of Tesla's value, after a week when Tesla and the AI trade sold off.
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CNBC's Jim Cramer says Lilly will be a $2 trillion stock, and analysts expect its earnings to more than double between 2025 and 2028.
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Hims & Hers will now sell Zepbound and Foundayo directly. Self-pay already brings in 40% to 45% of Zepbound sales.
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At today's multiple, the earnings analysts expect for 2028 would value Lilly at about $1.6 trillion. Reaching $2 trillion needs a higher multiple or growth that keeps going past 2028.
Eli Lilly ( LLY:NYSE )has been the one big stock investors could hide in this week. While Tesla ( TSLA:NASDAQ )and the AI trade sold off, Lilly closed Friday worth $1.27 trillion. That leaves it roughly 10% behind Tesla's value of about $1.4 trillion.
Lilly also announced on Friday that Hims & Hers Health ( HIMS:NYSE )will sell its obesity drugs directly on the telehealth company's platform.
On Friday's episode of Squawk on the Street , CNBC's Jim Cramer called Lilly "a beacon throughout this," and then he went further:
"I do believe that Lilly is a $2 trillion stock. I think it's going to be."
That's about $730 billion more than Lilly is worth today.
Cramer based the call on what CEO Dave Ricks told the show. He said Lilly's current studies, which "all tend to be actually going really well," suggest that about 15% of the population needs to be on a GLP-1 to get the most out of the drugs.
The earnings did the heavy lifting
Lilly's stock hasn't held up on hope. In late October, third-quarter revenue rose 39% to $24.4 billion, and Lilly raised its 2026 revenue forecast to $91-$92 billion, from $85-$87 billion. Mounjaro sales grew 65% to $10.7 billion, and Zepbound's grew 49% to $5.4 billion.
Analysts expect normalized EPS to more than double, from $24.21 in 2025 to $57.78 in 2028. That's after EPS nearly quadrupled from $6.32 in 2023:
That kind of growth is why Cramer's number isn't crazy.
TIKR tracks 31 analysts on Eli Lilly. How many say "Buy"?
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Hims & Hers opens another door
Before Friday, a Hims & Hers patient who wanted Zepbound or Foundayo had to leave the site and go to LillyDirect, Lilly's own cash-pay platform. Now Hims will sell both directly at LillyDirect's prices, starting at $149 a month for the Foundayo pill and $299 for Zepbound. Hims also agreed not to sell compounded copies of Lilly's obesity drugs. That's a big channel for Lilly, since 40% to 45% of Zepbound sales already come through self-pay, the company says.
Novo Nordisk has sold Wegovy and Ozempic through Hims since March, so Lilly is catching up with its main rival there. But Lilly already leads: management says its drugs fill about 6 in 10 U.S. prescriptions in this class of obesity drugs. Analysts expect revenue to reach $119 billion by 2028, up from $65.2 billion in 2025:
The last $400 billion is the hard part
Even with all that growth, investors aren't paying up for Lilly like they used to. It trades at 29x forward earnings, well below its five-year average of 40x and far from its 67x peak in October 2023:
If the multiple stays at 29x, the $57.78 analysts expect for 2028 would value Lilly at about $1.6 trillion. That's comfortably above Tesla's value today, but still about $400 billion short of Cramer's number.
To close that gap, investors would have to pay more for each dollar of earnings. Lilly trades at about 23x its 2028 estimate today, and a $2 trillion Lilly would trade at about 37x. That's still under the five-year average, though well above the 29x investors pay now.
Passing Tesla is the easy part
The biggest threat to a higher multiple is Washington. Democrats won back the House and the Senate on Tuesday, and they've generally been more willing to push on drug prices. Lilly is already cutting its own prices: in the second quarter, realized prices fell 13% while volume rose 60%.
With only about 10% between them, I expect Lilly to pass Tesla soon. And I think Cramer gets his $2 trillion. I just think it'll take earnings beyond 2028 to get there, because I wouldn't count on investors paying 37x while a Democratic Congress is looking at drug prices.
Of course, Lilly can still surprise. Its investor update on Dec. 7, where it's due to set long-term targets for margins and spending, will be the next read on how fast those earnings can grow.
So what is Eli Lilly stock actually worth?
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