Eli Lilly vs. Viking Therapeutics Stock: Which Is the Best Growth Opportunity, According to Wall Street?

Eli Lilly and Viking Therapeutics are prominent players in the rapidly expanding weight loss drug market, projected to reach $95 billion by 2030. Eli Lilly, a market leader with Mounjaro and Zepbound, reported a 38% revenue increase to over $15 billion in its latest quarter, with weight loss drugs comprising more than half of sales, and is advancing an oral obesity candidate. Viking Therapeutics, developing the dual GIP/GLP-1 agonist VK2735 in late-stage trials with positive results, is positioned as a potential competitor or acquisition target, with Wall Street analysts forecasting a 179% upside for Viking compared to 10% for Lilly, reflecting Viking's higher growth potential despite increased risk.

Analysis

The weight loss drug market is projected for substantial growth, expanding from $28 billion to $95 billion by 2030, presenting a significant opportunity for pharmaceutical companies. Eli Lilly, a current market leader, demonstrated robust performance in its latest quarter, with revenue climbing 38% to over $15 billion, primarily driven by its blockbuster weight loss drugs, Mounjaro and Zepbound, which constituted over half of total sales. The company has also addressed supply chain issues and is preparing to submit its oral candidate, orforglipron, for global regulatory review this year.

Viking Therapeutics is emerging as a strong contender in this expanding market, with its dual GIP/GLP-1 agonist, VK2735, showing positive results in Phase 3 (injectable) and Phase 2 (oral) trials. This progress positions Viking to potentially compete with established players within a few years. Furthermore, Viking represents a compelling M&A target for larger pharmaceutical companies seeking to enter or expand their presence in the high-growth weight loss sector.

Wall Street analysts maintain a positive outlook for both companies, with buy recommendations outweighing sells. Eli Lilly is forecast for a 10% increase to $891 over the next 12 months, reflecting its established market position and continued growth. In contrast, Viking Therapeutics is projected for a significantly higher 179% gain to over $92, indicating substantial upside potential, albeit with higher inherent risk due to its pre-commercial stage.

Key Decisions for Investors

• Investors seeking established market leadership and consistent revenue growth in the weight loss drug sector should consider Eli Lilly, given its strong current performance and pipeline.
• Aggressive investors with a higher risk tolerance may evaluate Viking Therapeutics for its significant upside potential and M&A optionality, given its promising late-stage pipeline.
• Monitor the clinical trial progress and regulatory submissions for both companies' pipeline candidates, as these will be critical catalysts for future valuation.
• Assess portfolio allocation based on individual risk appetite, recognizing Lilly's lower risk profile compared to Viking's higher growth, pre-commercial stage.