jetcityimage Shares of Eli Lilly ( NYSE: LLY ) and Novo Nordisk ( NVO ) have soared in recent months, fueled by skyrocketing demand for the companies’ respective weight-loss/diabetes drugs tirzepatide, also known as Mounjaro and Zepbound, and semaglutide, better known as Ozempic and Wegovy. Over the past 12 months, shares of Lilly have shot up 76% while Novo Nordisk shares have jumped 58%. In comparison, the S&P 500 has climbed 28%, as of market close on May 17.
The rest of Big Pharma, meanwhile, has been a mixed bag as far as returns. Over the last 12 months, GlaxoSmithKline ( GSK ) has fared the best, with shares up 25%, followed AbbVie ( ABBV ) at 16%, Merck ( MRK ) at 14%, and Novartis ( NVS ) and AstraZeneca ( AZN ) posting single-digit gains. On the flip side, Bristol Myers Squibb ( BMY ) shares have plunged 34% during the same period, followed by Pfizer ( PFE ), down 22%, and Roche ( OTCQX:RHHBY ), down 18%, with Sanofi ( SNY ) and Johnson & Johnson ( JNJ ) seeing single-digit declines.
Thanks to the run-ups in their stock prices, Lilly and Novo Nordisk now boast the largest market caps in Big Pharma at $732B and $588B, respectively, with J&J coming in at a distant third at $372B, according to Yahoo Finance data. Which brings us to the magic question: are shares of Lilly and Novo Nordisk overvalued? We asked Seeking Alpha analysts Stephen Ayers , Edmund Ingham and Terry Chrisomalis for their thoughts on the subject. Are Lilly and Novo Nordisk overvalued? Stephen Ayer.
