Jim Cramer’s Latest Calls: Top 10 Stocks

2. Eli Lilly And Co (NYSE:LLY)

Number of Hedge Fund Investors: 106

Jim Cramer was recently asked about  Regeneron during a program on CNBC. He said he prefers Eli Lilly And Co (NYSE:LLY).

“Regeneron is a quandary. I’ve got to tell you, I expected sales to be better, but they’re not. I don’t want to give up on a stock down at $749, but I do prefer Eli Lilly And Co (NYSE:LLY) even at $900 because, you know, I think that $900 is the next stop for Lilly at $813. I’m not sure what the next stop for Regeneron is.”

LLY shares fell after Q3 results at the end of October. There were several points in Eli Lilly And Co (NYSE:LLY)’s report that spooked investors. Management revised down the upper range of Lilly’s revenue guidance, citing “inventory decreases in the wholesaler channel” for key growth products Mounjaro and Zepbound in Q3. The updated outlook reflects ongoing supply chain challenges as these products face unprecedented demand.

However, Eli Lilly And Co (NYSE:LLY) bulls believe long-term catalysts for the stock are well intact.

To meet strong demand for its tirzepatide products, Lilly introduced new vial formats for Zepbound and Mounjaro, which improve accessibility and reduce supply strain on injection pens. The company has also been enhancing its go-to-market strategy, securing extensive U.S. health plan coverage for Zepbound and exploring expanded tirzepatide indications, including Medicare-eligible treatments like obstructive sleep apnea.

Another key catalyst comes from oncology. Eli Lilly And Co (NYSE:LLY) is seeing robust demand for its non-incretin medicines, notably Verzenio, which grew 32% year-over-year in Q3, aided by higher U.S. prices and a 70% adoption rate in metastatic breast cancer treatments. To further capitalize on Verzenio’s success, Lilly is testing it in combination with Imlunestrant in a Phase III trial, aiming to enhance patient outcomes and address current inefficiencies in metastatic ER+ breast cancer care.

Madison Sustainable Equity Fund stated the following regarding Eli Lilly and Company (NYSE:LLY) in its Q3 2024 investor letter:

“Alphabet Inc.,Eli Lilly and Company (NYSE:LLY), Qualcomm Incorporated, Microsoft Corporation, and Apple Inc. were the largest detractors. After first half strength, Eli Lilly has traded in a range this quarter, despite dramatically raising revenues and earnings following their second quarter report. There is a lot of noise in the Diabetes-Obesity space as many companies are looking for opportunities to get into the market, which is expected to exceed $100 billion in revenues in 2030. We have not seen any competitor data that would dethrone Novo Nordisk or Lilly but are watching carefully. Manufacturing capacity is a key barrier to entry and Lilly and Novo have locked up capacity for the next several years.”