Eli Lilly shares dropped sharply Friday, falling more than 14% in early trading after clinical trial data for its oral obesity drug orforglipron missed market expectations. Despite the decline, Wall Street analysts remain broadly positive on the stock, pointing to strong earnings and long-term growth potential in the diabetes and obesity markets.
Trial results disappoint Jefferies, triggering price target cut
The sell-off followed topline results from the company’s 72-week ATTAIN-1 trial, which showed 11.2% absolute weight loss at the highest 36 mg dose. Jefferies analysts had expected a reduction closer to 13–15%, in line with other GLP-1 class treatments.
In response, Jefferies lowered its price target from $1,057 to $905, though the firm maintained a Buy rating. The downgrade reflected a more cautious outlook on Eli Lilly’s competitive position in the oral obesity drug market.
Analysts also flagged adverse event data as a concern. Approximately 24% of trial participants experienced vomiting, and up to 30% discontinued treatment across study groups.
Strong earnings offer a silver lining
Despite clinical setbacks, Eli Lilly’s recent second-quarter earnings beat expectations. The company posted:
- Earnings per share (EPS): $6.31 (vs. $5.59 forecast)
- Revenue: $15.56 billion (vs. $14.67 billion expected)
These strong results show resilience in core product areas, particularly tirzepatide, which remains a major growth driver in the GLP-1 diabetes and obesity segment.
Wells Fargo analyst Mohit Bansal reiterated a Buy rating and held a $1,100 price target, citing upward guidance revisions and continued strength in Eli Lilly’s pipeline and manufacturing expansion.
Analyst consensus stays bullish despite volatility
TD Cowen also reaffirmed its Buy rating with a $960 target, suggesting that short-term volatility may not fully reflect the company’s broader growth prospects. Analysts emphasized:
- Continued expansion in the cash-pay market
- Expected increases in vial-based sales
- Resilience in Zepbound and tirzepatide sales despite formulary changes
However, corporate insider sentiment has turned more cautious. Recent filings show an uptick in insider share sales, raising questions about internal confidence amid regulatory and commercial headwinds.
What to watch next
Investors will closely monitor:
- FDA reviews for upcoming drug indications
- Market reaction to ongoing GLP-1 competition
- New data from longer-term obesity and diabetes trials
- Updates on supply chain and manufacturing capacity for high-demand products
With shares currently trading near $640, the stock sits well below even the most conservative analyst target, suggesting room for recovery if the company delivers consistent clinical and financial performance in coming quarters.
This content is brought to you by the FingerLakes1.com Team. Support our mission by visiting www.patreon.com/fl1 or learn how you send us your local content here.