Eli Lilly (LLY +4.46%) is the most valuable healthcare stock on the U.S. markets, with a valuation north of $1.1 trillion. Space Exploration Technologies Corp (SPCX -2.57%), also known as SpaceX, is worth significantly more at $1.8 trillion.
There is, however, a substantial disconnect in value. Eli Lilly's strong growth, financials, and dominance in the GLP-1 space justify the stock's rising value over the years. SpaceX, however, is fueled mainly by hype and long-term expectations. The overall business is deeply unprofitable.
The stocks could be heading in different directions from here on out. Could Eli Lilly become more valuable than SpaceX by the end of 2026?
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SpaceX's stock could continue falling, while Eli Lilly may rise higher
Although SpaceX stock has only been trading publicly for a couple of months, it's already been highly volatile. It's bounced off lows of around $104 that it hit a few weeks ago, when the panic around its lockup expiration appeared to rattle the space stock. But with the company still generating significant losses and its cash burn potentially accelerating in future periods, another disappointing quarter later in the year could send it back into a free fall. Plus, there may still be a wave of insider selling that drags the stock lower. That may happen, particularly if the markets appear shaky later on.
NASDAQ: SPCX
Key Data Points
Eli Lilly, meanwhile, has been picking up steam and is up around 25% in the past six months. It hit a new all-time high on Wednesday, and yet it may not be terribly overpriced; it's trading at a forward price-to-earnings multiple of 34, based on analyst projections of future growth. Given the company's growth and revenue rising 48% in its most recent quarter, a premium may well be justified for the healthcare giant, as it is not only growing fast but also highly profitable.
NYSE: LLY
Key Data Points
Will Eli Lilly soar past SpaceX by the end of the year?
For Eli Lilly to catch up to SpaceX, it would need to rise by more than 60% before the end of the year. I don't see that happening. There's no catalyst out there that's likely to trigger that kind of a sharp uptick.
However, its valuation may still end up higher than SpaceX's if the space company experiences a significant decline in value. If it were to decline by around 40% to about $84 per share, it would be right around Eli Lilly's market cap. Or, alternatively, SpaceX stock falls by a smaller amount while Eli Lilly rises.
I do think that in the long run, Eli Lilly will end up more valuable than SpaceX, but the wheels would have to come completely off SpaceX's stock for that to happen before the end of 2026. I think the gap is too wide for Eli Lilly to be the more valuable company by the end of the year. But I do think that the healthcare stock is the far better buy right now.
