Why Eli Lilly Stock Crawled Higher Today
What happened
Storied pharmaceutical company Eli Lilly (NYSE: LLY) eked out a win on the stock exchange Monday. The company's share price closed 1.2% higher on the day, edging past the 0.6% rise of the S&P 500 index. Investors were cheered by good news in a hot area of the industry, plus an analyst's price-target hike.
So what
A survey conducted by healthcare insurer Accolade in collaboration with research firm Savanta indicated that the total number of American businesses covering weight-loss drugs is set to nearly double.
According to the results of the 502-respondent survey, 43% of those asked said they would include such medications in the healthcare coverage they provide for employees in 2024. That's quite a jump from the 25% that do so at present.
Even those who are not planning to offer such coverage recognize that such drugs are heavily in demand. Of the poll's respondents, 81% said that their workers are interested in adding them to the list of covered medications.
Eli Lilly developed and markets Mounjaro, a type-2 diabetes treatment that has similar weight-shedding properties as Novo Nordisk's ultra-popular related medicines, Wegovy and Ozempic.
Now what
Separately, Eli Lilly stock got a boost from that price-target lift. Analyst Mohit Bansal of Wells Fargo increased his fair value estimation on the shares to $650 apiece, well up from his previous level of $615. Bansal maintained his overweight (buy, in other words) recommendation on the stock as he did so. His reasoning behind the move wasn't immediately apparent.
10 stocks we like better than Eli Lilly
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Eli Lilly wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of October 9, 2023
Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.
