AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
Eli Lilly (NYSE:LLY) and Johnson & Johnson (NYSE:JNJ) are two of the most prominent players in the pharmaceutical and healthcare industries. Both companies are renowned for their extensive product portfolios and global reach, but they are navigating distinct paths with different growth trajectories and financial strategies.
Eli Lilly: A Leader in Diabetes, Weight Loss, and Alzheimer’s Treatments
Eli Lilly has made headlines with its innovations in diabetes and weight loss treatments. The company’s flagship diabetes drug, Mounjaro, has already exceeded $5 billion in revenue during its first full year on the market, showcasing its rapid acceptance and potential. Complementing this success, Zepbound, approved in November, is experiencing strong market uptake.
Looking ahead, Eli Lilly is pushing the envelope with several promising programs. Insulin efsitora alfa, a once-weekly insulin product in phase 3 trials, could be launched within the next two years if it clears regulatory hurdles. In the weight loss sector, Lilly is developing mazdutide and retatrutide, the latter of which is projected to generate up to $5 billion in revenue by 2030.
Moreover, Eli Lilly is expanding its presence in the field of Alzheimer’s disease with the recent approval of Kisunla, a treatment for early symptomatic Alzheimer’s. This move positions Lilly as a key player in a notoriously challenging therapeutic area, with more approvals and label expansions anticipated in the coming years.
Despite its focus on diabetes, weight loss, and Alzheimer’s, Eli Lilly maintains a solid dividend policy. Although its forward yield stands at 0.65%—below the S&P 500 average of 1.3%—the company has nearly doubled its dividend payouts over the past five years, reflecting a strong commitment to returning value to shareholders.
Johnson & Johnson: A Diversified Healthcare Powerhouse
Johnson & Johnson has faced challenges in recent years, including recent U.S. legislation allowing Medicare to negotiate drug prices, which could impact revenue for some of its products. Despite these challenges, J&J remains a formidable force in the healthcare sector due to its diverse product portfolio, global footprint, and extensive experience.
J&J’s pharmaceutical segment boasts over ten blockbuster medicines, providing resilience against market disruptions and patent expirations. The company’s ability to navigate regulatory changes, including Medicare price negotiations, is supported by its strong financial foundation and strategic adaptability.
A significant strategic move for J&J was the spin-off of its consumer health segment into a separate entity, Kenvue. This separation is expected to enhance J&J’s focus on its core pharmaceutical and medical device businesses, potentially improving top-line growth rates in the future.
J&J’s financial stability is underscored by its AAA credit rating from Standard & Poor’s—the highest possible rating—demonstrating the strength of its balance sheet. The company’s long track record of dividend increases is notable, with payouts rising for 62 consecutive years. Its forward dividend yield of over 3% offers attractive returns for income-focused investors.
