Eli Lilly’s Stock (NYSE: LLY) Continues to Outperform Leading into Earnings – What Next?

Eli Lilly’s stock (NYSE: LLY) continues its relentless ascent, solidifying its position as a titan not just in pharmaceuticals, but within the broader market narrative of growth and innovation. Trading back above $900 at $918 as of pre-market, LLY has added 2.12% in the session, to the 1.52% gain seen yesterday. With earnings due before market open, we take a closer look at what to expect from the print.

Consensus estimates for the upcoming Q1 2025 report point to EPS of $3.26 on revenue of $12.67B. Full-year 2025 projections are even more bullish, forecasting EPS of $22.40 (a 72.44% YoY leap) and revenue of $59.49B (up 32.08%). Indeed, Lilly itself raised its 2025 revenue guidance significantly to $58–$61 billion, reflecting confidence in Mounjaro and Zepbound sales momentum.

Beyond the excitement surrounding orforglipron, Lilly’s existing portfolio continues to fire on all cylinders. Q4 2024 results already demonstrated this strength, with revenue hitting $13.53B and EPS reaching $5.32, beating analyst expectations.

Recent Developments Help LLY Outperform

The most significant recent catalyst arrived mid-April with the announcement of stellar Phase III results for orforglipron, Lilly’s investigational oral GLP-1 receptor agonist. Data from the ACHIEVE-1 trial showcased “injectable-like efficacy,” with patients achieving significant reductions in both A1C levels (1.5%) and body weight (7.9%) after 40 weeks, compared to minimal changes in the placebo group. This positions orforglipron as a potential game-changer – the first small-molecule oral GLP-1 drug poised to rival the efficacy of established injectables from both Lilly (tirzepatide) and competitor Novo Nordisk (semaglutide).

An effective oral option, taken daily without food or water restrictions, offers unparalleled convenience, potentially unlocking a vast patient population hesitant about injections. Furthermore, as a small-molecule drug, orforglipron promises more scalable and resilient manufacturing, a crucial advantage given the supply chain struggles that have plagued the injectable GLP-1 market.

Lilly, learning from past Mounjaro shortages, has proactively invested in manufacturing capacity, signaling readiness for a global launch anticipated for weight management by late 2025 and diabetes by 2026. The market reaction was immediate and emphatic, with LLY shares surging up to 14.3% in premarket trading on April 17 following the news. Analysts lauded the development, suggesting Lilly is well-positioned to challenge Novo Nordisk’s dominance in the burgeoning obesity market, estimated to be worth hundreds of billions globally within the decade.

Adding another layer to Lilly’s growth story is its promising Alzheimer’s pipeline, spearheaded by donanemab. Following a unanimous endorsement from an FDA advisory panel in June 2024, anticipation is high for a potential approval later in 2025. Donanemab, which demonstrated a 35% slowing of cognitive decline in early-stage patients, could carve out a significant share of the multi-billion dollar Alzheimer’s market, complementing Lilly’s metabolic disease franchise. The company is also innovating on the commercial front, expanding its LillyDirect platform to streamline access to care, including for Alzheimer’s patients.

Technical Snapshot and Valuation Considerations

From a technical standpoint, LLY presents a generally bullish picture. The stock trades comfortably above its key 50-day ($832.90) and 200-day ($843.50) simple moving averages, typically seen as a positive sign by chart analysts. While the MACD indicator flashes a short-term ‘sell’ signal and the RSI (63.48) suggests neutral momentum rather than overt overbought conditions, the overall trend supported by moving averages remains positive.

However, the Average True Range (ATR) of $36.48 underscores the stock’s inherent volatility, characteristic of high-growth names with significant pipeline catalysts.

This recent momentum in the stock price builds upon an impressive long-term record. Lilly shareholders have enjoyed outsized returns, with the stock gaining 485.14 % over five years. Zooming out further, the ten-year gain stands at a remarkable 1,130.75%, a testament to the company’s successful pivot towards high-growth therapeutic areas, particularly diabetes and obesity with its blockbuster treatments Mounjaro and Zepbound.

Despite the overwhelmingly positive narrative, potential headwinds exist. The stock’s valuation is undeniably rich, trading at approximately 40 times forward earnings – double the S&P 500’s average. This led HSBC to downgrade the stock to “Hold” recently, citing the premium valuation reflecting already high expectations. Competition remains fierce, with Novo Nordisk aggressively defending its market share (including price cuts for Wegovy) and other players like Roche developing novel weight-loss therapies. Furthermore, any unexpected regulatory delays or safety issues with key pipeline assets like orforglipron or donanemab could temper enthusiasm.

The company’s innovation engine, particularly in metabolic diseases and potentially soon in Alzheimer’s, is firing powerfully, translating into exceptional historical returns and bright future projections. The breakthrough potential of orforglipron adds a significant layer of excitement. While short-term volatility and valuation concerns warrant consideration, Lilly’s strategic execution, manufacturing readiness, and deep pipeline position it as a formidable force in the pharmaceutical landscape.