Thoughts on Eli Lilly for a long-term buy and hold?

A great one for that.
It's a strong buy below $800

I got some about 1.5 years ago, so I am sitting up 43% right now.

I think the GLP-1 drug momentum is still building. Losing weight is the single best health item a person can do, that is starting to sink in. The being fat is OK crowd is getting silenced finally.

quote:

---

For buying and holding for the longterm, thoughts?

---

Generally if you try to hold biotech long term you will mostly be up, but if you are expecting continued explosive growth I think you are betting on something pretty rare.

Obviously LLY has had massive growth thanks to its GLP-1 drug, and the stock market rightfully rewarded them with big jump over the years.

At this point when it comes to biotech, you pretty much assume that the revenue growth from this is basically priced into the stock.

Now LLY needs to pivot all its earnings from this blockbuster drug to find the next one, however to find another GLP-1 is basically impossible. It is just so difficult to bring multiple blockbuster drugs to the market.

I would expect sales to be fantastic, earnings to be beat and the stock market to yawn because the growth will slow.

The other issue is that they will be facing ever increasing competition in the space from other drug companies which will slowly eat at their margins. I think some of that is overblown, but I think GLP1 drugs are prescribed so regularly that they have a reputation of bankrupting governments. I think there is a large risk that a drug provided by a competitor hits the market and negotiates a much lower price points directly with PBMs and cuts out LLY.

LLY cuts 2025 guidance; sites lower than expected demand for diabetes and obesity drugs

quote:

---

Eli Lilly said it now expects full-year 2024 revenue of about $45 billion. That’s lower than the $45.4 billion to $46 billion the company anticipated in October. The new outlook would still mark a 32% jump in revenue from the prior year.

---

I'd be adding or buying.