Eli Lilly Earnings: Solid Results Driven by Mounjaro as Competitor Data Also Bodes Well for the Drug

Eli Lilly reported strong second-quarter results slightly ahead of our projections, but we don't expect any major changes to our fair value estimate based on the outperformance. We believe Lilly's strong growth in the quarter reflects several recent innovative product launches that reinforce the firm's wide moat. However, despite projecting above-consensus peak sales for diabetes and weight loss drug Mounjaro (the firm's most important recent launch), we still view Lilly's stock as overvalued, with the market showing signs of over-optimism for the firm.