Bank of America has significantly raised Eli Lilly's price target from $950 to $1,286, implying a 22% upside potential, while reiterating its Buy rating. The upgrade is based on the company's robust drug development pipeline and its leading position in the obesity and diabetes medication market.
On December 2, Bank of America analyst Tim Anderson stated in a research note that Eli Lilly is poised for sustained exceptional growth over the coming years, driven by its dominant position in the obesity and diabetes drug market and faster-than-expected progress in new drug development.
The bank's bullish stance on Eli Lilly primarily stems from the strong performance of its GLP-1 drugs, Zepbound and Mounjaro, which maintain a "number one" position in the large obesity and diabetes markets. Anderson noted that despite complex competition in this space, Eli Lilly continues to hold a firm lead.
The bank also highlighted that Eli Lilly's new drug development timeline is ahead of expectations. Analysts now anticipate the oral drug orforglipron to launch in early 2026, rather than the previously projected late 2026, leading to upward revisions in revenue and earnings forecasts for the company over the next year.
Additionally, the overall valuation rebound in the biopharmaceutical sector serves as a favorable factor. Anderson believes that as the Trump administration's healthcare policy priorities become clearer, the market has renewed its favor for the sector. Eli Lilly's stock has surged 36% year-to-date.
**Faster-Than-Expected Drug Development Progress** The key catalyst for Bank of America's price target increase is Eli Lilly's accelerated drug pipeline progress. Anderson expects the oral GLP-1 drug orforglipron to hit the market in early 2026, ahead of prior market expectations for a late 2026 launch. This timeline adjustment prompted analysts to raise revenue and earnings estimates for Eli Lilly over the next year.
Anderson pointed out: "The company is set to introduce the highly anticipated oral GLP-1 drug orforglipron at an accelerated pace, as it secured one of the FDA's first National Priority Review vouchers. The company guides for a March 2026 launch."
Meanwhile, Eli Lilly is advancing the broad Phase 3 development program for its high-potency drug retatrutide (also known as "triple G"), with initial results potentially available by year-end. The simultaneous progress across multiple pipelines has strengthened market confidence in Eli Lilly's long-term growth potential.
**GLP-1 Drugs Reinforce Market Leadership** Eli Lilly's obesity and diabetes treatments, Zepbound and Mounjaro, maintain a leading edge in the competitive GLP-1 drug market. Anderson wrote in the research report: "While the obesity category is complex with many moving parts, we continue to believe Eli Lilly will firmly maintain its leadership position, driving exceptional growth for years to come. Given this backdrop, its valuation is justified."
The GLP-1 drug market is vast and rapidly growing, and Eli Lilly's strong foothold with its two products solidifies its competitive standing in the pharmaceutical industry—a key reason for Bank of America's sustained bullish outlook.
**Sector Valuation Regains Support** The broader rebound in biopharmaceutical sector valuations provides additional support for Eli Lilly's stock. Anderson noted that as the Trump administration's healthcare policy priorities become clearer, the market has re-embraced the sector, contributing to the recovery in industry valuations.
This policy clarity has alleviated investor concerns about regulatory uncertainty in the pharmaceutical sector, creating more favorable valuation conditions for major biopharma companies, including Eli Lilly. The company's stock has climbed 37% year-to-date, outperforming the broader market.