Eli Lilly and Company (LLY): A Bull Case Theory

We came across a bullish thesis on Eli Lilly and Company (LLY) on Business Model Mastery’s Substack. In this article, we will summarize the bulls’ thesis on LLY. Eli Lilly and Company (LLY)’s share was trading at $765.68 as of 5^th June. LLY’s trailing and forward P/E were 62.30 and 35.09 respectively according to Yahoo Finance.

Eli Lilly is no longer just a pharmaceutical giant—it’s becoming a platform company that’s reshaping the very structure of global healthcare. At the heart of this transformation is tirzepatide, a dual-action molecule marketed under separate brands for diabetes and obesity. This single drug now accounts for over a quarter of Lilly’s total revenue, with the diabetes version generating $11.5 billion (up 330% YoY) and the obesity variant reaching $2.3 billion in its first year—a historic ramp-up.

These are not just growth numbers; they’re margin-rich results, with 85 %+ gross margins and minimal marketing spend due to entrenched trust among endocrinologists. Crucially, tirzepatide is protected by a fortress of patents through 2036 and beyond, giving Lilly a durable edge in two massive markets.

Unlike peers, Lilly owns its injectable manufacturing end-to-end, having invested over $5.5 billion in internal capacity, giving it unmatched agility and control while rivals struggle with supply constraints. Its sales force and deep prescriber relationships, built over decades, have only grown more powerful thanks to a new direct-to-consumer platform that streamlines initiation and adherence.

Meanwhile, the company is reinvesting aggressively, with $11 billion (24% of revenue) spent on focused R&D spanning Alzheimer’s, oncology, and rare diseases. Its pipeline—anchored in metabolic, neurodegenerative, and immune disorders—builds on existing strengths, accelerating commercialization.

Competition exists, but Lilly’s molecule consistently outperforms, and its infrastructure outscales. With two-thirds of sales still U.S.-based, global expansion represents the next lever. In sum, Lilly’s model—a convergence of science, scale, and system—positions it as more than a pharma company. It’s a precision biology platform with extraordinary strategic depth and long-term compounding potential.

Previously, we covered a bullish thesis on Eli Lilly (LLY) by Kontra on Substack in May 2025, which aligns with Business Model Mastery’s analysis, emphasizing the company’s leadership in obesity and diabetes care. Both highlight tirzepatide’s explosive growth, margin strength, and Lilly’s massive investment in capacity and R&D. Kontra focuses more on near-term financial results, pipeline expansion, and regulatory catalysts, while Business Model Mastery frames Lilly as a precision biology platform with structural advantages—like end-to-end manufacturing and patent longevity—that support durable outperformance. Together, they reinforce Lilly’s status as a long-term compounder with deep moats and global runway.

Eli Lilly and Company (LLY) is on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 119 hedge fund portfolios held LLY at the end of the first quarter which was 115 in the previous quarter. While we acknowledge the risk and potential of LLY as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. This article was originally published at Insider Monkey.