Bernstein SocGen Group has reiterated an Outperform rating on Eli Lilly (NYSE:LLY) and maintained a $1,300 price target on the shares as market participants weigh potential disruption to the GLP-1 category. The price objective implies roughly 23% upside from the stock’s cited level of $1,058.18, and comes with the observation that LLY is trading near a 52-week high of $1,133.95. Research data referenced in the analysis indicates the company is trading close to its Fair Value.
The firm convened a webinar that included a former Industry Counsel and an ex-CMS policy expert to assess the policy and legal implications of a $49 semaglutide pill recently launched by Hims. Bernstein’s discussion centered on how that product and its distribution model - pairing telehealth services with vertical integration into compounding - may create a new competitive dynamic across oral and injectable GLP-1 therapies.
In its report, Bernstein described the combination of telehealth and compounding as producing what it called "mass personalization" - a level of individualized treatment at geographic scale it said has not been seen in prior market episodes. The firm raised concerns that Hims appears to be operating in a regulatory gray zone by invoking 503A compounding status, which permits personalization for specific patients, while potentially taking advantage of uncertainty about the allowable scale and sequencing of that personalization.
Bernstein identified multiple developments investors should monitor closely, including:
- Any change in federal regulatory tone toward compounding and telehealth-facilitated therapies
- State-level regulatory responses that could restrict or clarify compounding operations
- Emerging safety signals tied to compounded formulations
- Potential restrictions on access to active pharmaceutical ingredients (APIs)
- Lawsuits from original drug manufacturers challenging compounding or distribution practices
- Increased scrutiny of advertising for low-cost semaglutide products
- Heightened public attention during major events, with the Super Bowl noted as an upcoming moment for visibility
Despite these competitive and regulatory uncertainties, the firm and other analysts continue to point to Eli Lilly’s strong underlying performance. The company reported robust full-year metrics, including 44.7% revenue growth in the period referenced by analysts, and recent fourth-quarter results that beat expectations - revenue exceeded forecasts by 7.1% and earnings per share came in 12.0% above estimates. Management’s guidance that followed the results was met positively by investors.
Eli Lilly has also advanced strategic deals that analysts cite as reinforcing its growth outlook. The company announced an agreement to acquire Orna Therapeutics for up to $2.4 billion, structured as an upfront payment plus potential milestone-based payouts tied to the development of Orna’s circular RNA technology for in vivo cell engineering. Separately, Eli Lilly entered a collaboration with Innovent Biologics to pursue new treatments for cancer and immune system diseases, a partnership that could generate up to $8.5 billion in milestone payments.
Market reactions from other research houses have echoed Bernstein’s optimism. Following the earnings announcement, JPMorgan raised its price target to $1,300, citing material growth potential in the obesity and type 2 diabetes markets. BMO Capital also increased its target to $1,300, highlighting Eli Lilly’s leadership in the incretin category. Bernstein’s reiteration of an Outperform rating and the $1,300 target came after consideration of both the corporate results and the evolving competitive landscape.
Additional investment notes emphasize the company’s dividend consistency and balance-sheet measures as part of its financial profile, with research tools listing 14 supplemental tips for LLY related to dividends and financial health metrics.
As the GLP-1 market evolves, the interaction of regulatory oversight, compounding practices, telehealth distribution models, and legal challenges will be central to how competitive dynamics play out. For investors, monitoring the specific developments Bernstein flagged will be essential to assessing near-term risks to incumbents as well as the longer-term implications for revenue and market share.