Cramer: I asked some tech insiders what to buy. They surprisingly said this drug stock
Jim Cramer said Monday that even tech-focused people think the world of Eli Lilly stock, with one predicting the drugmaker could eventually reach a $2 trillion market capitalization. “So, I’m with three cyber guys this weekend, and … I’m asked, ‘Well, how about this [stock]? How about that?’ [One of them] goes, ‘Eli Lilly, $2 trillion.’ I said, all right, I’ll take that,” Jim recalled without providing names. “This is someone who is actually deeply involved in cybersecurity. He says the one that the one you want to be in is Eli Lilly. I said, ‘But aren’t you like involved with CoreWeave ?’ He said. ‘Eli Lilly.'” That’s “incredible,” Jim added. Jim’s point is that even among techies, Eli Lilly was singled out as one to buy. Jim recalled how it was billionaire investor Ken Langone who told him to watch out for Lilly, predicting a few years ago that the stock would top a $1 trillion market cap. It happened nearly a year ago and now stands at a $1.2 trillion valuation. “Well, Lilly is, like Ken Langone said, going to be the biggest [drug] company in the world,” Jim said. He loves Lilly, which has emerged as the dominant player in GLP-1s. The Club has our hold-equivalent 2 rating on the stock, which has been red-hot lately. Shares closed at a record high of more than $1,306 each on Oct. 22. They drifted a bit lower since then. LLY 5Y mountain Eli Lilly 5-year performance Reaching $2 trillion would represent another roughly 67% increase from current levels. Lilly shares have already surged 15% from their mid-September low, fueled by continued enthusiasm for the drugmaker’s blockbuster weight-loss treatments like injectable Zepbound and daily pill Foundayo. The bullish call also comes amid a broader shift in market leadership. Healthcare has been among the best-performing sectors this quarter, while tech has been among the weakest. Investors are increasingly looking beyond the AI trade for growth opportunities, and Lilly has been a standout. Shares of the drug giant have climbed 10.5% month-to-date — far outpacing the Dow ‘s roughly 2.8% gain, the S & P 500’s 0.3% increase, and the Nasdaq ‘s 2.4% loss. Lilly’s next test comes Thursday, when it reports third-quarter earnings. Investors will be watching for further signs of growth in its weight-loss drug business , particularly as Foundayo gains traction. (Jim Cramer’s Charitable Trust is long LLY. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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