Eli Lilly’s $6.5 Billion Expansion, Trump’s Drug-Price Remarks – LLY Stock Needs to Break $830 Zone
Despite today's big rise, which was supported by positive political remarks and Wall Street analysts' ongoing optimism, Eli Lilly's stock...
Quick overview
- Eli Lilly's stock surged 5% today, reaching approximately $765, following supportive comments from former President Trump regarding drug pricing.
- Despite the rally, the stock remains in a year-long downtrend and faces significant resistance at the $830 level that must be overcome for a trend reversal.
- Analysts maintain a positive outlook on Lilly's long-term prospects, with Guggenheim reaffirming a Buy rating and a price target of $875.
- The company plans to invest $6.5 billion in a new manufacturing facility in Texas to expand production capacity, highlighting its commitment to growth.
Despite today’s big rise, which was supported by positive political remarks and Wall Street analysts’ ongoing optimism, Eli Lilly’s stock still faces significant resistance levels that need to be overcome in order to stop its protracted downward trend.
A 5% Surge After Political Support
Eli Lilly (NYSE: LLY) climbed 5% today, rising from $726.51 at yesterday’s close to about $765. The upward move came after former U.S. President Donald Trump reiterated his administration’s goal to lower drug prices in remarks at the White House, highlighting Lilly as a partner in those efforts.
US President Trump Comments
- Other companies will be coming in over the next week.
- Eli Lily has been fantastic
- On drug prices if they don’t lower prices, we will put a tariff on them at the equivalent amount.
- On Pfizer, drug price lowering will be immediate.
- Trump government spending, we will probably have a shut down..
- On government spending, we can do things in a shut down that are irreversible
- Democrats are taking a risk
- We can cut benefits.
- We can do things medically during a shut down.
Meanwhile, Pfizer added to the discussion by reporting that some medications had already experienced average price cuts of 50%, with certain treatments seeing reductions as deep as 85%. The remarks boosted optimism for pharmaceutical players able to balance affordability with profitability.
Technical Levels Still Pose a Challenge
Despite the rebound, Lilly’s stock remains in a year-long downtrend. The shares had traded above $970 in August before plunging to lows near $625. For a true trend reversal, analysts stress that the stock would need to surpass $830 and break above the 50-week SMA (yellow), which has shifted from support to resistance after last year’s slide below key moving averages.
LLY Stock Chart Weekly – MAs Have Turned Into Resistance
Analysts Stay Confident on Long-Term Prospects
Guggenheim reaffirmed its Buy rating on LLY and kept its $875 price target, reflecting ongoing optimism about the company’s fundamentals. Other analyst estimates range widely from $650 to $1,190, showing divided opinions on how quickly Lilly can regain momentum.
Lilly currently trades at a P/E ratio of 47.5—a sign of high growth expectations. Guggenheim highlighted that the company’s recent performance, including a 36.83% revenue increase and an 82.64% gross profit margin, supports its outlook. Operational efficiency and robust financial health continue to be core strengths for the pharmaceutical giant.
Strategic Investments to Expand Capacity
The company recently announced plans to invest $6.5 billion in a new manufacturing facility in Texas, part of its effort to expand production capacity for small-molecule therapies, including a promising experimental obesity treatment.
This investment builds on Lilly’s earlier commitment to spend at least $27 billion this year to develop four additional U.S. manufacturing facilities, underscoring its strategy to scale up domestic output and strengthen its product pipeline.
Outlook: Balancing Momentum and Resistance
The rally to $765 demonstrates investor appetite for Lilly’s long-term growth story, but chart resistance near $830 remains the next key hurdle to watch. Strong fundamentals, expanding production, and supportive analyst coverage offer a constructive backdrop—yet technical confirmation above key moving averages will be crucial to signal a sustained shift back into bullish territory.
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