Eli Lilly, Novo Nordisk and Merck: Buy, Sell or Hold?

Vandita Jadeja

Wed, August 19, 2026 at 7:00 PM GMT+3 4 min read

Quick Read

LLY dominates the GLP-1 race with 48% revenue growth and an unpriced Retratrutide catalyst, while NVO battles 50% Wegovy price cuts and pipeline setbacks.
Merck has rallied 31% year to date and now trades near its analyst mean target, making the next leg dependent on 2027 pipeline catalysts.
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Among the pharma names investors debate most, Eli Lilly (NYSE:LLY) at $1,216.46 screens most constructively, Novo Nordisk (NYSE:NVO) at $45.92 looks range-bound, and Merck (NYSE:MRK) at $135.97 screens as fairly valued. All three trade in a market obsessed with GLP-1 economics and Merck's KEYTRUDA patent cliff, and each has priced in a very different version of the future.

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The scoreboard already tells a story. Lilly is up 10.63% year to date, Merck has ripped 31.09%, and Novo has slipped 7.57%, versus an S&P 500 gain in the high single digits. Who is winning the incretin war and who is stuck defending share is largely settled at these prices.

Eli Lilly: Why the GLP-1 Leader Still Has the Strongest Setup

Lilly's Q2 delivered $14.9 billion in combined Mounjaro and Zepbound revenue, non-GAAP EPS of $8.38, and total revenue growth of 48%. Management raised 2026 guidance to $85 to $87 billion in revenue and $35.50 to $36.50 in EPS.

Foundeo, the oral GLP-1, has scaled from 8,000 to 36,000 prescribers, and Retratrutide's TRIUMPH readouts set up a Q1 2027 BLA that CEO Dave Ricks says gives Lilly "a pretty large lead over any competitors with a triple acting medicine."

The mean analyst target sits at $1,310.90 across 28 analysts, with 22 Buy or Strong Buy ratings. A forward P/E of 32x is not cheap, yet quarterly revenue growth of 47.7% and gross margin of 86.3% give the multiple room.

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Targets are a data point, not a promise, but at $1,216 manufacturing capacity and price realization are the main things to watch while demand keeps compounding.

LLY Price Target — 24/7 Wall St.

Novo Nordisk: Priced for Bad News While Recovery Remains Distant

Novo's Q2 landed adjusted sales of DKK 78.5 billion with CER operating profit growth of 11%, and Wegovy pill has cleared 5 million prescriptions with roughly 90% of the oral obesity market. Valuation looks arresting at a forward P/E of 14x with a 4% dividend yield.

The bear case is loud. Full-year 2026 guidance still calls for 0% to -6% sales growth at CER, the SUSE cardiovascular trial for siltivecumab failed with a MACE hazard ratio of 0.99, monlunabant absorbed a $4 billion impairment, and list price cuts of roughly 50% on Wegovy and 35% on Ozempic take effect January 1, 2027.

A mean target of $47.03 across 14 analysts, of which 10 rate Hold, implies almost no upside from here. Patience wins until pricing bottoms and Cagrisema's Redefine 11 data clears.

NVO Price Target — 24/7 Wall St.

Merck: KEYTRUDA Cliff Priced In, Pipeline Still Ahead

Merck's YTD rally reflects renewed confidence in CEO Rob Davis's pitch that the KEYTRUDA loss of exclusivity is "more of a hill than a cliff." Q2 KEYTRUDA franchise sales of $8.4 billion grew 4%, WINREVAIR hit $588 million up 75%, and Davis's $70 billion new-product framework is de-risking faster than expected on positive SAC-TMT and Tulasocobar readouts.

Shares now sit right at the $137.73 mean target across 28 analysts. Forward P/E of 50x reflects a depressed EPS base from a $2.31 per share Terns charge inside 2026 guidance of $2.66 to $2.76.

With Lipvendra, the first oral PCSK9, launching and IDXD approval expected in the second half, the setup is constructive, but the easy money after a 31.09% YTD move has been made.

MRK Price Target — 24/7 Wall St.

The Bottom Line at Today's Prices

At $1,216.46, Lilly screens most attractively on incretin dominance and a Retratrutide catalyst Wall Street has not fully valued. Novo looks range-bound at $45.92 until pricing stabilizes and pipeline setbacks stop compounding. At $135.97, Merck trades near fair value after a strong run, with the 2027 catalyst calendar deciding the next leg.