Eli Lilly Posts Stellar Q3: Long-Term Upside Is Well in Play

Since tanking in early August, shares of Eli Lilly and Company (NYSE: LLY) have roared back with a vengeance. The world’s most valuable healthcare stock plummeted around 14% on Aug. 7 after releasing somewhat disappointing data on its developmental oral GLP-1 drug, orforglipron. Eli Lilly shares have surged around 40% from that August dip.

Aiding the stock’s rise was Lilly’s Q3 2025 earnings report, released on Oct. 30. Shares rose around 10% over the three following trading days. Below, we’ll break down Eli Lilly’s latest earnings and gain an updated outlook on the stock. Overall, how should investors view the short- and long-term potential of Eli Lilly shares? 

Lilly Posts Big Q3 Beats, Mounjaro’s International Sales Skyrocket

Lilly’s Q3 results trounced expectations. Revenue came in at $17.6 billion, equal to a nearly 54% growth rate. This was Lilly’s fastest quarterly growth rate in company history and far surpassed expectations of 41% growth. Lilly also smashed its estimates on the bottom line, with adjusted earnings per share of $7.02. This figure beat estimates by 60 cents. Lilly also boosted the midpoint of its full-year revenue guidance by $2.25 billion to $63.25 billion. The midpoint of its adjusted EPS guidance also rose by around 98 cents to $23.35.

Lilly brands its most important drug, tirzepatide, as both Zepbound and Mounjaro. Zepbound continues its explosive growth, with sales rising 185%. Mounjaro’s 109% growth was also very impressive. Lilly continues to take share in the U.S. “incretin analogs” market, in which Zepbound and Mounjaro both reside. Particularly noteworthy was the strength of international Mounjaro sales. Mounjaro’s international revenue more than quadrupled to $3 billion versus $728 million in Q3 2024. Overall, Lilly’s results were music to investors' ears, justifying the significant run-up in shares recently. Now, let’s examine the future of Eli Lilly in the short and long term.

Analysts See Moderate Near-Term Upside in LLY

The MarketBeat consensus price target on Lilly stands at $940. This figure implies moderate upside potential in shares of just under 5%. However, it is notable that after Lilly’s Q3 release, Cantor Fitzgerald set a considerably more bullish price target of $985. The figure implies just under 10% upside in shares.

Overall, this price target data helps provide a gauge of Lilly’s near-term potential.

Given the dramatic rise in shares over the past few months, it’s not surprising to see that the stock’s implied upside is relatively limited. Notably, Lilly trades at a forward price-to-earnings (P/E) ratio of 30x. This is 33% below its average forward P/E of 45x during the last three years. This suggests that Eli Lilly’s valuation is much more reasonable than it has been in the past, which could potentially limit downside risk.

LLY: Strong Long-Term Potential, But Approval and Trial Risk Always Looms

Lilly’s real potential for appreciation comes over a long-term horizon. The company still has yet to start selling orforglipron, which could be its next blockbuster. The company plans to apply for regulatory approval of orforglipron by the end of the year. If approved, the drug could come onto the market in the second half of 2026 or early 2027.

There is also retatrutide, Lilly’s developmental triple agonist weight-loss and diabetes drug. Retatrutide is currently in a plethora of Phase 3 Food and Drug Administration (FDA) trials. Previous trial results have shown that retatrutide could be even more effective than tirzepatide, which is currently the most effective drug of its kind on the market.

Retatrutide saw a mean weight reduction of up to 24.2% at 48 weeks in a Phase 2 trial. Comparatively, tirzepatide showed a mean weight reduction of up to 20.9% at 72 weeks. Thus, retatrutide has shown the potential to result in significantly more weight loss in a much shorter timeframe. This provides retatrutide with the ability to be another huge winner for Eli Lilly down the road. Eli Lilly expects to receive results for up to six Phase 3 retatrutide trials by the end of 2026. These results will undoubtedly have a significant impact on Lilly’s share price, for better or worse.

However, given the company’s demonstrated success in the weight loss and diabetes market so far, it is reasonable to think this success will continue. Still, there is a significant risk that orforglipron or retatrutide do not receive FDA approval. Ultimately, these are risks that investors should be comfortable with if they wish to capture the considerable long-term upside potential in LLY shares.

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