Paul Harris, CFAEli Lilly & Co.LLYBUY ON WEAKNESSSep 28, 2026

A recent purchase. Growing well. Revenues in first half of 2026 up 76%, earnings up 51%. Lots of runway. Anticipates applications of GLP-1 beyond diabetes and weight loss. Trades increasingly in a reasonable valuation band; right now, ~26x PE for 2027. Robust growth rates of 25+% as far as the eye can see. Yield is 0.55%.

This is the CDR version traded on the TSX. Eli Lilly is one of the 10 largest market cap companies in the world. It has decent numbers that are now starting to accelerate with their obesity and diabetes drugs. The adoption rate of these drugs is picking up. Also healthcare stocks are more in focus with investors.

Leading market share (about 2/3) in GLP-1 drugs, and that's very much driving the story in the US and globally. 150-year history of healthcare innovation. In US, extended Medicare and Medicaid coverage now; this expands the US addressable market. Also oncology, immunology, and neurosciences. 

Massive FCF, much of it being poured into an M&A bonanza. Good path to both income and capital appreciation. Yield is 0.59%, growing at 15% compound pace over last 5 years.

They bought ~$300, and have trimmed at these levels. Not sure the same 3-bagger upside is ahead over 5 years, but a nice and steady grower. One of the fastest-growing drug companies in the world. More GLP-1 drugs in the pipe, as well as in other areas. One of the best management teams in the space.

Bit expensive at 25x PE. He'll be looking to see revenue drivers of 2030 and beyond to justify the multiple.

The chart had good relative strength from May to August, then it pulled back. From mid-June to now, the trend is sideways, and is getting more rangebound. It's neutral, grinding sideways. 

Their valuation has fallen a lot and looks attractive now. The big question is: Can they diversify beyond GLP-1?

The momentum can continue. Up 55% this year and trades at nearly 30x PE. There's strong growth from the GLP-1 drug, but is diversifying through serious M&A, totalling $20 billion so far this year. They are expanding market share, though face competition from Novo.

Obesity is the main push, not much else in the pipeline. Not a particularly interesting buying opportunity, wait for it to get significantly cheaper. Still believes in the fundamental story. Monthly expense can be afforded by only a small cohort, and that's reaching saturation. Need government and big insurance to absorb the cost as good for society.

Though beating and raising, the next 3 years won't see the returns you saw over the last few years.

Pharma and biotech are seeing better leadership in the market. Partly because these sectors are going to be big implementers of AI, and the sector was out of favour for quite some time. They tend to be pretty big cash generators.

He's a big fan of focusing on the leaders in a sector -- easier time hiring best employees and raising capital. He'd much prefer this over PFE. Lots of revenue upside. GLP-1 market will continue to grow, as these drugs help with all kinds of issues.

Don't put new $$ in today. Priced to perfection on its execution abilities. At some point it will stumble. Good company, but very expensive.

Consistent earnings, fair valuation, and a great drug pipeline.

Is up 370% over 5 years, but really started to rise in 2023. He expects revenue growth to consistently build in coming quarters. Trading at all-time highs now.

Was upgraded today. It's the highest-quality healthcare stock. They have more than just the GLP-1 drug; are diverse with their entire drug catalogue. Exceptional execution. Good PE. 

Broad pipeline, but its leadership in GLP-1 is what's really pushing the stock. New catalyst is approval for oral pill. Winning battle against NVO. Sees ~25% earnings growth rate over next several years. 

Broken out to a new space on the charts. He looks to buy on dips if possible. Yield is 0.57%.