Eli Lilly is Tuesday's IBD Stock Of The Day after the company wrapped its $1.4 billion takeover of Point Biopharma.
Point Bio is working on radioligand treatments for cancer. These treatments involve tying a radioisotope to a molecule that finds cancer cells in the body. This allows the drug to deliver targeted radiation to the tumor directly, limiting the effects on healthy tissue nearby.
The move deepens Lilly's efforts in cancer treatment. The company's third-biggest product is a breast cancer treatment called Verzenio. During the third quarter, sales of Verzenio catapulted 68%, narrowly topping $1.04 billion. Lilly also makes a handful of other cancer drugs with smaller sales.
Eli Lilly stock is forming a flat base with a buy point at 629.97, according to MarketSmith.com. But the stock provided an early entry Tuesday as it broke above its 50-day moving average and a trendline touching the highs since Nov. 8. Investors could also consider buying in if Lilly shares top 600.
Eli Lilly stock rose 1.6% to close at 592.20.
Eli Lilly Stock: Weight-Loss Leader
Eli Lilly is also one of the leaders in diabetes and weight-loss drugs.
The company has a series of insulins and other diabetes drugs that act on the GLP-1 hormone. But it's best-known for Mounjaro, a diabetes drug that mimics two gut hormones, GLP-1 and GIP, to improve feelings of satiety, slow how fast the stomach empties itself and improve markers of blood glucose.
The chemical name behind Mounjaro is tirzepatide. On Nov. 8, the Food and Drug Administration signed off on tirzepatide as a weight-loss drug, sending Eli Lilly stock 3.2% higher. In that market, it sells under the brand name Zepbound. Mounjaro and Zepbound rival Novo Nordisk's semaglutide. Semaglutide sells as diabetes treatments known as Ozempic and Rybelsus, and in obesity treatment as Wegovy.
Wall Street expects Lilly to notch massive sales gains on the back of its diabetes and obesity drugs. In the third quarter, Mounjaro brought in $1.41 billion in sales. Tirzepatide is expected to generate $75 million in the fourth quarter, its first on the market.
By 2028, those numbers are expected to rise to $19.63 billion and $11.37 billion, respectively.
At the same time, Lilly's profits are projected to skyrocket from an estimated $6.60 per share — minus some items — in 2023 to $29.78 a share in 2028. Today, Eli Lilly stock has a middling EPS Rating of 65, according to IBD Digital. This is a measure of a company's recent profitability.
But Eli Lilly stock has a stronger Relative Strength Rating of 90, putting its 12-month performance among the top 10% of all stocks.
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