Eli Lilly & Co. (LLY)

Has done very well on weight loss, plus favourable news on Alzheimer's drug. Hard to buy, especially as a value investor, as it keeps going higher. Trades over 60x PE. Lots of momentum. Expectations very high. History has shown that it's really hard for companies to sustain really strong growth rates for consecutive years and to continuously ramp up margins. Competition always comes in.

She's not a technical fund manager, but if there's a big pullback, you could use technicals to look for an entry point. Have to consider your investment horizon.

In the sector, weight loss is the growth area right now. So he'd probably look at LLY and NVO. Those pipelines are probably going to be fairly robust.

Chart's in an uptrend. Nothing nasty going on. Flattening, pulling back a bit. Good chart. Keep owning, and you could actually add to your position. Healthcare's not doing too badly as a sector.

Valuation has skyrocketed as a beneficiary of GLP-1 drugs, so MRK gets the nod. Good job developing products.

Is doing very well but is risky because it's trading at far higher multiple than its peers. If there's competition in their obesity drug, shares will sink.

Debt-to-equity continues to climb. He rebalanced his portfolio and sold this. Still a good stock that he targets $900 for. It trades like a biotech.

It reports Tuesday. He expects good numbers because their obesity drug keeps selling out, but they can't produce it fast enough which could impair the top and bottom lines.

Obesity space has performed well lately. Has owned stock for around two years. Valuation has continued to improve. Products are very profitable. Demand for new drugs continue to rise. Would recommend keeping at small weight in portfolio - share price very high. Very competitive industry within drug sector. 

It peaked in early March but remains resilient. It benefits from other health companies not announcing news that excites investors. LLY is universally owned.

It's too early to tell what the long-term results of the weight-loss drugs, but short term people are buying them. You need to know a lot of tech and chemistry to understand pharma stocks and he doesn't care to do that. If you believe their drug prices will fall and more people will use them, then these share will rise.

Excellent technical momentum. Highly ranked from technical perspective. Performance very good the past year. Outperforming sector overall. Very skilled management team with strong brand. 

Agrees with this call. Obesity drugs remain a big opportunity within healthcare, a $100-billion market by 2030, says Goldman; half the world's population would qualify by then. True, LLY is expensive at 55x forward PE, he still likes and owns this. He may trim at a higher price.

Their popular obesity drug is like AI--a lot is already priced in, though the obesity drug may be applicable to other ailments.

Big difference between a company and a stock. It's like buying a jacket for different price points of $1000, $300, or on sale for $150. You make an investment/purchase decision. 

LLY and NVO are great companies, but you have to look at how expensive they are. Quite expensive at around 50x earnings. Good growth rates. A reasonable multiple for a drug company is sub-20x, and these won't get there via discounted cashflow until next decade. That's a long way out.

He looks for things that have yet to be priced properly. He owns MRK.

The fundamental story is compelling, enjoying momentum and a technical breakout, but it could pause before it resumes its climb.