Lilly Stock Lags Behind Peers Despite Strong Revenue Growth
Eli Lilly (LLY) outpaced its peers in revenue growth over the last twelve months, increasing by 49.6% and maintaining the highest operating margin of 49.7%. However, it trails behind Merck and Johnson & Johnson in terms of stock return, despite being a more significant growth leader.
Merck saw its stock return at 89.6%, while revenue only increased by 4.6%. This anomaly is not unique to Merck, as Johnson & Johnson also experienced slower growth but higher returns. Lilly's CFO attributed the disparity in part to one-off rebate adjustments and initial channel stocking for Mounjaro launches.
The company's lead now rests heavily on its two drugs, Mounjaro and Zepbound, which together brought in $14.9 billion of the total $23.0 billion revenue in Q2 2026. With more patients taking these medicines at lower prices, Lilly continues to benefit from volume growth despite falling prices.