Eli Lilly & Co.

Lilly has been struggling for the past year. Hard to watch. From my perspective the downtrend looks to be caused by two specific factors. Orforglipron - a GLP-1 receptor weight loss drug was part of a recent trial that did not hit expectations. This miss is leading to a sell off from investors who were looking for another big hit. Hype - the PE ratio of LLY has been sky high for too long, and the inevitable force of market fundamentals are forcing the price back down to reality. Even with strong performances by Mounjaro and Zepbound, without another unicorn there just isn't enough to support the valuation. On the other hand Lilly is currently pouring billions into manufacturing, and that could pay off big by simply widening sales of their existing GLP-1 drugs. It's not just Americans dealing with an obesity epidemic. There's also other upcoming drugs like retatrutide that could spark a revival. For a company with the kind of moat Lilly has and with their already dominant market, I think the drop this year is generally an overreaction, and there is still lots of long term potential.