Eli Lilly Stock (LLY) Gets a Bullish Note from JPMorgan Chase

 JPMorgan Chase JPM -0.94% ▼ is pounding the table on the stock of pharmaceutical giant Eli Lilly LLY -0.88% ▼ as sales of its weight-loss drugs accelerate. Chris Schott, a top four-star rated analyst with a 60% success rate, reiterated a Buy-equivalent overweight rating and $1,400.00 price target on LLY stock. The JPMorgan analyst says that Eli Lilly remains positioned for significant upside over the next several years driven by favorable trends in its obesity drug business.

Schott wrote in a note to clients that he expects sales of Eli Lilly’s weight-loss drugs to outperform expectations over the next several years as the obesity market outside the U.S. ramps up. The full global launch of Eli Lilly’s new weight-loss pill Foundayo should further expand the market with a lower cost and popularity among consumers. The note from JPMorgan comes after Eli Lilly delivered strong financial results in August, fueled by surging obesity drug sales.

Eli Lilly’s earnings per share. Source: The Fly

In the U.S. market, Schott sees upside for Eli Lilly from the growing coverage of weight-loss drugs by Medicare. The analyst also expects Eli Lilly products to account for the vast majority of weight-loss drug prescriptions issued through the Medicare channel. The $1,400.00 price target that JPMorgan has on LLY stock is 20% higher than where the shares currently trade.

Lastly, Schott notes that Eli Lilly recently launched its weight-loss pill Foundayo in the United Kingdom, marking the first European country to offer the medication. Plus, Eli Lilly continues to grow its pipeline of new medications through acquisitions, recently purchasing Merida Biosciences for $2.88 billion in cash. The acquisition boosts Eli Lilly’s treatments for autoimmune diseases.

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