Revenue can still grow about 26% next year, but at $1,190 the stock already needs that growth at a high 26 times 2027 earnings. A 12-month target of $1,265 is a market-like return.
Key points
- $85, 87 billion is 2026 revenue guidance after the August 5 raise; first-half sales were already $42.8 billion.
- $14.9 billion of Q2 revenue came from Mounjaro and Zepbound, 65% of first-half sales, with volume up and realized price down.
- 26 times next-year earnings is what $1,190 requires if 2027 EPS is $45.50; that is not a cheap growth multiple.
The call
The stock at $1,190 needs 2027 earnings near $45 a share and a mid-20s multiple to hold here. Company 2026 EPS guidance of $35.50 to $36.50 already includes a $3.03 IPR&D hit; the underlying run-rate is higher, so the market is not ignoring growth.
I expect $108 billion of 2027 revenue and $45.50 of EPS as volume from injectables, Foundayo, and retatrutide offsets price. That still only supports $1,265 at 27.8 times, a 6% move. The market is about right, slightly optimistic on the multiple.
Revenue ($ billions) and my 2026-27 estimatesSEC company facts through Q2 2026; 2026E midpoint of company guidance; 2027E is mine
Valuation
| Item | Figure |
|---|
| 2026 revenue (guidance midpoint) | $86 billion |
| 2027 revenue (my estimate) | $108 billion |
| 2027 EPS (my estimate) | $45.50 |
| Multiple on 2027 EPS | 27.8 times |
| 12-month target | $1,265 |
A 28 times multiple is what a 25% grower with 34% net margins can keep if rates stay near 5%. Upside to $1,400 needs both 30 times and $47 EPS. Downside to about $1,000 is a 22 times print if price cuts outrun volume. Asymmetry is modest, which is why the rating is hold, not buy.
Risks
- Net price on incretins falls faster than volume if commercial access and Medicare terms bite; watch sequential U.S. price in the 10-Q.
- Retatrutide filing slips past Q1 2027 on manufacturing or the BLA path; watch the next 8-K and call.
- Self-pay Zepbound, about 45% of prescriptions, stalls if household budgets tighten; watch LillyDirect refill comments.
What would change my mind
A 2027 revenue path clearly above $115 billion with stable net prices, or a collapse in sequential incretin volume, would force a new target.