Jim Cramer Reveals Top 10 Stocks to Watch

4. Eli Lilly and Company (NYSE:LLY)

Number of Hedge Fund Investors: 100

Talking about pharma stocks, Jim Cramer highlighted Eli Lilly and Company (NYSE:LLY)’s impressive earnings performance, noting that the company delivered the best earnings beat of the season and significantly raised its forecast.

“Eli Lilly, a drug company, delivered the best earnings beat of the season and raised its forecast significantly, thanks to its successful weight loss drug, GLP-1.”

Eli Lilly and Company (NYSE:LLY) has a strong lineup of promising drugs, including its successful diabetes treatment, Mounjaro (tirzepatide), which has proven effective for both diabetes and obesity. Eli Lilly and Company (NYSE:LLY)’s Alzheimer’s drug, Donanemab, has also shown positive results, establishing Lilly as a leader in neurodegenerative disease treatments.

To strengthen its research and product offerings, Eli Lilly and Company (NYSE:LLY) has made strategic acquisitions. The purchase of Dermira in 2021 expanded its dermatology portfolio while acquiring Prevail Therapeutics in 2020 enhanced its gene therapy capabilities.

Eli Lilly and Company (NYSE:LLY) has reported strong financial performance, with consistent revenue growth driven by its key products. Recent earnings reports showed increased revenue and earnings, reflecting overall strong performance. Additionally, Eli Lilly and Company (NYSE:LLY) has received regulatory approvals for several new drugs and benefits from partnerships with organizations like the National Institutes of Health (NIH) and other biotech firms, which provide valuable resources and collaborative opportunities.

Baron Health Care Fund stated the following regarding Eli Lilly and Company (NYSE:LLY) in its Q2 2024 investor letter:

“Shares of global pharmaceutical company Eli Lilly and Company (NYSE:LLY) increased on continued investor enthusiasm around GLP-1 drugs for diabetes and obesity. We remain shareholders. Lilly’s Mounjaro/Zepbound not only offers superb blood sugar control for diabetics but can drive 20%-plus weight loss and likely improve cardiovascular outcomes in both diabetic and non-diabetic obese patients. Lilly is developing next generation drugs, including retatrutide, which drives approximately 25% weight loss, and orforglipron, a daily pill that produces approximately 15% weight loss. In the U.S. alone, there are 32 million Type 2 diabetics and an additional 105 million obese patients who we estimate would qualify for GLP-1 drugs. Although supply and access are limited near term, we think GLP-1 drugs will become standard of care for both diabetes and obesity and will become a $150 billion-plus category. We see Lilly setting a high efficacy bar and capturing significant long-term market share. We think the adoption of GLP-1s will drive Lilly to triple total revenue by 2030.”