Eli Lilly (LLY) stock broke out bullishly Tuesday — surging 15% and adding $64 billion to its market cap — after the drugmaker walloped Wall Street’s second-quarter forecasts partly due to diabetes treatment powerhouse Mounjaro.
Mounjaro sales skyrocketed by a quadruple-digit percentage, bringing in $979.7 million. That topped expectations by more than $200 million, Leerink Partners analyst David Risinger said in a note to clients. Third Bridge analyst Lee Brown says experts are “excited about Mounjaro.” Lilly is now hoping the Food and Drug Administration will approve it for weight loss.
If that happens, Mounjaro will directly rival Novo Nordisk‘s (NVO) Wegovy, the only approved drug in the GLP-1 class for obesity treatment. On Tuesday, Novo said a five-year study showed Wegovy reduced the risk of cardiovascular events. That includes heart attacks and strokes in overweight adults or those with obesity and cardiovascular disease, but not diabetes.
“This is good news for Eli Lilly, which is awaiting FDA approval for a weight-loss (use) in diabetes drug, Mounjaro,” Edward Jones analyst John Boylan said in his note to clients. “Insurance plans still need to agree to reimburse for these drugs for certain patient types, but (Novo’s study) results should open the door for this possibility.”
Eli Lilly stock catapulted 14.9% to close at 521.60 on today’s stock market. Novo shares rocketed 17.2% to close at 189.17. Both stocks broke out of flat bases. Eli Lilly stock topped a buy point at 469.87, according to MarketSmith.com. Novo’s entry was at 172.97.
Eli Lilly Stock: Lilly Easily Beats Forecasts
Overall, Lilly earned an adjusted $2.11 per share on $8.31 billion in second-quarter sales. The two metrics easily topped Eli Lilly stock analyst forecasts for a respective $1.98 per share and $7.58 billion, according to FactSet.
Lilly’s earnings soared almost 69%, though it benefited from a payment of 43 cents related to the sale of its hypoglycemia drug to Amphastar Pharmaceuticals (AMPH), Third Bridge’s Brown said in a note. Sales advanced 28%.