Eli Lilly's (LLY 2.14%) big problem is its success in the GLP-1 drug space. Its Mounjaro (for diabetes) and Zepbound (for weight loss) drugs grew sales by 99% and 175%, respectively, in 2025.
That's impressive, but Wall Street is perhaps a bit too excited about the stock. Here's why you might want to forget about Eli Lilly and buy GLP-1 laggards Novo Nordisk (NVO 1.89%) and Pfizer (PFE 0.97%) instead.
Eli Lilly is the victim of its own success
It's hard to complain about a pharmaceutical company that has approved drugs in its portfolio that are growing as quickly as those from Eli Lilly. However, there are a few issues to consider. For starters, those levels of sales growth probably aren't sustainable over the long term. Also, Mounjaro and Zepbound basically accounted for nearly all of Lilly's 45% sales growth in 2025.
Image source: Getty Images.
The most worrying problem, however, is that these two GLP-1 weight loss drugs already account for 56% of the company's top line. When patent protections on these drugs eventually end, there's going to be a huge hole to fill. Meanwhile, Wall Street is extremely excited about the stock, bidding the shares up to the point where the dividend yield is a tiny 0.6% and the price-to-earnings (P/E) ratio is a lofty 44.
Other GLP-1 options to consider
If you have a value bias or prefer stocks with higher yields, you'll probably want to look at GLP-1 competitors Novo Nordisk and Pfizer. Novo Nordisk was the first to launch a GLP-1 drug, but lost the lead to Eli Lilly because Lilly's drugs seem to be more effective right now. That said, Novo Nordisk was recently first to market with an oral GLP-1 medication, and it continues to invest in its related offerings.
NYSE: NVO
Key Data Points
Novo Nordisk recently announced the results of a GLP-1 drug trial that fell short of Wall Street's expectations. However, research and development isn't a smooth process, and the company continues to move forward. What's notable is that it has a very large diabetes business to support its ongoing efforts. That's also an important foundation to support the stock's current yield of 4.9%. The P/E is a very modest 10.
NYSE: PFE
Key Data Points
Pfizer involves a bit more risk. It had to abandon its internally generated GLP-1 drug. However, the company has a long and proven track record in the pharmaceutical industry. It quickly pivoted, buying a biotech with an attractive GLP-1 candidate. It's also exploring opportunities in the migraine and oncology spaces.
The yield is a lofty 6.3% right now because Pfizer has patent expirations coming up, and investors are factoring that into the price. Its payout ratio is above 100%. However, the company recently stated that it plans to support the dividend at its current level. The P/E is roughly 20.
Eli Lilly is priced for perfection
When you step back, it seems like Eli Lilly is priced for perfection, while investors largely ignore rivals Novo Nordisk and Pfizer. That could be an opportunity, because the drug sector is highly competitive and driven by innovation. Both Novo Nordisk and Pfizer have strong histories as highly competent competitors, so it seems likely they will thrive again in the near future.
