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Growth vs. Stability: Lilly and J&J's 2026 Investment Face-Off
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Key Takeaways
JNJ stands out for diversification and valuation, edging Lilly in an investment comparison.
LLY's growth is fueled by Mounjaro and Zepbound, driving over half of total revenues.
JNJ's pipeline, MedTech rebound, and steady cash flows support growth despite patent and legal headwinds.
Eli Lilly (LLY - Free Report) and Johnson & Johnson (JNJ - Free Report) are leading U.S.-based healthcare players in the pharmaceutical and biotech space.
Both companies have a solid footprint across oncology, immunology and neuroscience. J&J’s portfolio is further diversified with therapies spanning cardiovascular and metabolic diseases, pulmonary hypertension and infectious diseases, alongside a strong medical devices business. In contrast, Lilly has established a dominant position in cardiometabolic care, driven by its GLP-1 franchise, with Mounjaro and Zepbound emerging as key growth drivers.
Both companies are delivering robust revenue and earnings growth and appear well-positioned for the future. However, which stock offers the more compelling investment opportunity today? A closer look at their fundamentals, growth outlook and key risks can help answer that question.
The Case for Lilly
Lilly has seen tremendous success with Mounjaro and Zepbound, with demand rising rapidly. These therapies account for more than 50% of the company’s total revenues.
In 2025, the drugs generated combined sales of $36.5 billion, comprising around 56% of the company’s total revenues. Robust growth trends in the U.S. incretin analogs market and positive uptake trends of Mounjaro and Zepbound in new international markets led to strong sales growth in 2025, with the positive trend expected to continue in 2026.
In addition to Mounjaro and Zepbound, Lilly has secured approvals for several other new therapies over the past few years. These include Omvoh, Jaypirca, Ebglyss and Kisunla. These newly approved drugs are also contributing to Lilly’s revenue growth. Lilly expects its new drugs, Mounjaro, Zepbound, Ebglyss, Jaypirca, Inluriyo, Kisunla and Omvoh to drive sales growth in 2026.
Lilly is developing several next-generation, more powerful and more convenient GLP-1–based treatments, including oral options and multi-acting candidates.
Oral pills will be a more convenient alternative to the once-weekly injectable obesity treatments like Zepbound and rival Novo Nordisk’s (NVO - Free Report) Wegovy. Novo Nordisk gained approval for an oral version of Wegovy in December 2025 and launched the pill in January 2026. The Wegovy pill gave NVO a first-to-market advantage and will initially bring in additional revenues. However, we believe Lilly may be able to close the gap quickly now that the FDA has approved Foundayo.
Foundayo can prove to be a commercial game-changer for Lilly with the potential to bring in $1 billion-$2 billion in sales as early as 2026. In international markets, Lilly expects to launch orforglipron for obesity during 2027.
Lilly is also evaluating orforglipron in late-stage studies in other disease areas like obstructive sleep apnea, osteoarthritis pain of the knee, stress urinary incontinence and hypertension. These multiple late-stage studies on orforglipron can expand the candidate’s revenue potential beyond obesity/type II diabetes.
The company is evaluating another key candidate, triple-acting incretin, retatrutide in type II diabetes and obesity, along with other indications like obstructive sleep apnea, knee osteoarthritis, and chronic low back pain, in late-stage studies. Retatrutide represents a new generation of “triple-action” therapy as it targets three biological pathways — GLP-1, GIP and glucagon — whereas existing medicines mostly act on one or two biological pathways.
In the past couple of years, Lilly upped its efforts to diversify beyond GLP-1 drugs by expanding into cardiovascular, oncology and neuroscience areas. In 2025, it announced several M&A deals. In 2026, it has already announced three M&A deals, including the latest deal to acquire Centessa Pharmaceuticals.
Lilly has its share of problems. Prices of most of Lilly’s products are declining in the United States. Price is expected to continue to be a drag on top-line growth in the low to mid-teens percentage in 2026. Rising competition in the GLP-1 diabetes/obesity market is a key headwind. Also, sales of late-life cycle products like Trulicity, Taltz and Verzenio are expected to be flat or down in 2026.
The Case for J&J
J&J’s biggest strength lies in its diversified business model, as it operates through pharmaceuticals and medical devices divisions. It has more than 275 subsidiaries and boasts 28 platforms or products with more than $1 billion in annual sales. Its diversification helps it withstand economic cycles more effectively. It also boasts strong cash flows and has consistently increased dividends for 63 consecutive years.
J&J’s Innovative Medicine unit is showing a growth trend. The segment’s sales rose 4.1% on an organic basis in 2025 despite the loss of exclusivity (LOE) of blockbuster drug Stelara and the negative impact of the Part D redesign. Growth was driven by J&J’s key drugs like Darzalex, Erleada and Tremfya. New drugs like Carvykti, Tecvayli, Talvey, Rybrevant and Spravato also contributed significantly to growth.
J&J’s MedTech business has improved in the past three quarters, driven by the acquired cardiovascular businesses, Abiomed and Shockwave, as well as Surgical Vision and wound closure in Surgery. Improvements in J&J’s electrophysiology business also drove growth. MedTech sales rose 4.3% on an organic basis in 2025.
The company rapidly advanced its pipeline in the past year, attaining significant clinical and regulatory milestones that will help drive growth through the back half of the decade.
In 2025, it gained approval for new products like Inlexzoh/TAR-200, a first-of-its-kind drug-releasing system, for treating high-risk non-muscle invasive bladder cancer and Imaavy (nipocalimab) for treating generalized myasthenia gravis. The positive trend of new drug approvals continued in 2026 with the FDA approving J&J and partner Protagonist Therapeutics’ (PTGX - Free Report) Icotyde (icotrokinra) for moderate-to-severe plaque psoriasis.
In 2025, J&J invested more than $32 billion in R&D and M&A, including the acquisitions of Intra-Cellular Therapies and Halda Therapeutics. Backed by regular pipeline success, J&J expects a more pronounced impact from new products in 2026 than in 2025.
J&J believes 10 of its new products/pipeline candidates in the Innovative Medicine segment have the potential to deliver peak sales of $5 billion, including Talvey, Tecvayli, Imaavy, Caplyta, Inlexzo, Rybrevant, plus Lazcluze and Icotyde.
However, J&J faces its share of headwinds like the legal battle surrounding its talc lawsuits, the Stelara patent cliff, the upcoming LOE of key drugs Opsumit and Simponi, and softness in MedTech China.
How Do Estimates Compare for LLY & JNJ?
The Zacks Consensus Estimate for LLY’s 2026 sales and EPS implies a year-over-year increase of 25.7% and 40.9%, respectively. EPS estimates for 2026 and 2027 have risen over the past 60 days.
LLY Estimate Movement
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for J&J’s 2026 sales and EPS implies a year-over-year increase of 6.5% and 7.1%, respectively. The Zacks Consensus Estimate for 2026 earnings has risen from $11.54 to $11.56 over the past 60 days, while that for 2027 earnings has gone up from $12.40 per share to $12.48 over the same time frame.
JNJ Estimate Movement
Image Source: Zacks Investment Research
Price Performance and Valuation of LLY & JNJ
In the past year, LLY’s stock has surged 24.5% and J&J’s stock has risen 54.4%. The industry has jumped 21.7% in the said time frame.
Image Source: Zacks Investment Research
J&J looks more attractive than Lilly from a valuation standpoint. Going by the price/earnings ratio, Lilly’s shares currently trade at 25.57 forward earnings, significantly higher than 17.21 for the industry. However, LLY’s stock is trading below its 5-year mean of 34.57. J&J’s shares currently trade at 20.18 forward earnings, higher than the industry as well as the stock’s 5-year mean of 15.65.
Image Source: Zacks Investment Research
J&J’s dividend yield is 2.2%, while Lilly’s is around 0.7%.
Image Source: Zacks Investment Research
LLY or JNJ: Which is a Better Pick?
J&J outperformed financial expectations in 2025 and looks optimistic for continued strong momentum in 2026, with a target to generate around $100 billion in revenues in the year. J&J expects sales growth in both segments to be higher in 2026.
Despite headwinds like the legal battle surrounding its talc lawsuits, the Stelara patent cliff, the upcoming LOE of key drugs Opsumit and Simponi and softness in MedTech China, J&J looks quite confident that it will be able to navigate these challenges.
On the other hand, exceptional growth from Mounjaro and Zepbound has made Lilly the largest drugmaker. It delivered robust financial performance in 2025 with revenues surging 45% and EPS growing 86%. Expectations for continued growth in 2026 remain high with projected revenues of $80-$83 billion and EPS of $33.50-$35.00.
Lilly is a great stock to have in one’s portfolio, considering its product and pipeline portfolio in high-growth therapeutic areas like obesity, robust growth prospects and bullish analyst sentiment.
Choosing between Eli Lilly and J&J is probably the most difficult choice to make among large drug stocks. Both have seen steady growth in sales and earnings, rising stock prices and analyst estimates and have an optimistic outlook for 2026. Additionally, continued pipeline advancements, favorable regulatory developments, and strategic M&A activity have strengthened investor sentiment for both stocks.
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Growth vs. Stability: Lilly and J&J's 2026 Investment Face-Off
Key Takeaways
Eli Lilly (LLY - Free Report) and Johnson & Johnson (JNJ - Free Report) are leading U.S.-based healthcare players in the pharmaceutical and biotech space.
Both companies have a solid footprint across oncology, immunology and neuroscience. J&J’s portfolio is further diversified with therapies spanning cardiovascular and metabolic diseases, pulmonary hypertension and infectious diseases, alongside a strong medical devices business. In contrast, Lilly has established a dominant position in cardiometabolic care, driven by its GLP-1 franchise, with Mounjaro and Zepbound emerging as key growth drivers.
Both companies are delivering robust revenue and earnings growth and appear well-positioned for the future. However, which stock offers the more compelling investment opportunity today? A closer look at their fundamentals, growth outlook and key risks can help answer that question.
The Case for Lilly
Lilly has seen tremendous success with Mounjaro and Zepbound, with demand rising rapidly. These therapies account for more than 50% of the company’s total revenues.
In 2025, the drugs generated combined sales of $36.5 billion, comprising around 56% of the company’s total revenues. Robust growth trends in the U.S. incretin analogs market and positive uptake trends of Mounjaro and Zepbound in new international markets led to strong sales growth in 2025, with the positive trend expected to continue in 2026.
In addition to Mounjaro and Zepbound, Lilly has secured approvals for several other new therapies over the past few years. These include Omvoh, Jaypirca, Ebglyss and Kisunla. These newly approved drugs are also contributing to Lilly’s revenue growth. Lilly expects its new drugs, Mounjaro, Zepbound, Ebglyss, Jaypirca, Inluriyo, Kisunla and Omvoh to drive sales growth in 2026.
Lilly is developing several next-generation, more powerful and more convenient GLP-1–based treatments, including oral options and multi-acting candidates.
Last week, it gained the much-anticipated FDA approval for its once-daily oral GLP-1 pill, Foundayo (orforglipron), for treating obesity and launched the pill via LillyDirect and telehealth providers and is shipping to retail pharmacies nationwide.
Oral pills will be a more convenient alternative to the once-weekly injectable obesity treatments like Zepbound and rival Novo Nordisk’s (NVO - Free Report) Wegovy. Novo Nordisk gained approval for an oral version of Wegovy in December 2025 and launched the pill in January 2026. The Wegovy pill gave NVO a first-to-market advantage and will initially bring in additional revenues. However, we believe Lilly may be able to close the gap quickly now that the FDA has approved Foundayo.
Foundayo can prove to be a commercial game-changer for Lilly with the potential to bring in $1 billion-$2 billion in sales as early as 2026. In international markets, Lilly expects to launch orforglipron for obesity during 2027.
Lilly is also evaluating orforglipron in late-stage studies in other disease areas like obstructive sleep apnea, osteoarthritis pain of the knee, stress urinary incontinence and hypertension. These multiple late-stage studies on orforglipron can expand the candidate’s revenue potential beyond obesity/type II diabetes.
The company is evaluating another key candidate, triple-acting incretin, retatrutide in type II diabetes and obesity, along with other indications like obstructive sleep apnea, knee osteoarthritis, and chronic low back pain, in late-stage studies. Retatrutide represents a new generation of “triple-action” therapy as it targets three biological pathways — GLP-1, GIP and glucagon — whereas existing medicines mostly act on one or two biological pathways.
In the past couple of years, Lilly upped its efforts to diversify beyond GLP-1 drugs by expanding into cardiovascular, oncology and neuroscience areas. In 2025, it announced several M&A deals. In 2026, it has already announced three M&A deals, including the latest deal to acquire Centessa Pharmaceuticals.
Lilly has its share of problems. Prices of most of Lilly’s products are declining in the United States. Price is expected to continue to be a drag on top-line growth in the low to mid-teens percentage in 2026. Rising competition in the GLP-1 diabetes/obesity market is a key headwind. Also, sales of late-life cycle products like Trulicity, Taltz and Verzenio are expected to be flat or down in 2026.
The Case for J&J
J&J’s biggest strength lies in its diversified business model, as it operates through pharmaceuticals and medical devices divisions. It has more than 275 subsidiaries and boasts 28 platforms or products with more than $1 billion in annual sales. Its diversification helps it withstand economic cycles more effectively. It also boasts strong cash flows and has consistently increased dividends for 63 consecutive years.
J&J’s Innovative Medicine unit is showing a growth trend. The segment’s sales rose 4.1% on an organic basis in 2025 despite the loss of exclusivity (LOE) of blockbuster drug Stelara and the negative impact of the Part D redesign. Growth was driven by J&J’s key drugs like Darzalex, Erleada and Tremfya. New drugs like Carvykti, Tecvayli, Talvey, Rybrevant and Spravato also contributed significantly to growth.
J&J’s MedTech business has improved in the past three quarters, driven by the acquired cardiovascular businesses, Abiomed and Shockwave, as well as Surgical Vision and wound closure in Surgery. Improvements in J&J’s electrophysiology business also drove growth. MedTech sales rose 4.3% on an organic basis in 2025.
The company rapidly advanced its pipeline in the past year, attaining significant clinical and regulatory milestones that will help drive growth through the back half of the decade.
In 2025, it gained approval for new products like Inlexzoh/TAR-200, a first-of-its-kind drug-releasing system, for treating high-risk non-muscle invasive bladder cancer and Imaavy (nipocalimab) for treating generalized myasthenia gravis. The positive trend of new drug approvals continued in 2026 with the FDA approving J&J and partner Protagonist Therapeutics’ (PTGX - Free Report) Icotyde (icotrokinra) for moderate-to-severe plaque psoriasis.
In 2025, J&J invested more than $32 billion in R&D and M&A, including the acquisitions of Intra-Cellular Therapies and Halda Therapeutics. Backed by regular pipeline success, J&J expects a more pronounced impact from new products in 2026 than in 2025.
J&J believes 10 of its new products/pipeline candidates in the Innovative Medicine segment have the potential to deliver peak sales of $5 billion, including Talvey, Tecvayli, Imaavy, Caplyta, Inlexzo, Rybrevant, plus Lazcluze and Icotyde.
However, J&J faces its share of headwinds like the legal battle surrounding its talc lawsuits, the Stelara patent cliff, the upcoming LOE of key drugs Opsumit and Simponi, and softness in MedTech China.
How Do Estimates Compare for LLY & JNJ?
The Zacks Consensus Estimate for LLY’s 2026 sales and EPS implies a year-over-year increase of 25.7% and 40.9%, respectively. EPS estimates for 2026 and 2027 have risen over the past 60 days.
LLY Estimate Movement
The Zacks Consensus Estimate for J&J’s 2026 sales and EPS implies a year-over-year increase of 6.5% and 7.1%, respectively. The Zacks Consensus Estimate for 2026 earnings has risen from $11.54 to $11.56 over the past 60 days, while that for 2027 earnings has gone up from $12.40 per share to $12.48 over the same time frame.
JNJ Estimate Movement
Price Performance and Valuation of LLY & JNJ
In the past year, LLY’s stock has surged 24.5% and J&J’s stock has risen 54.4%. The industry has jumped 21.7% in the said time frame.
J&J looks more attractive than Lilly from a valuation standpoint. Going by the price/earnings ratio, Lilly’s shares currently trade at 25.57 forward earnings, significantly higher than 17.21 for the industry. However, LLY’s stock is trading below its 5-year mean of 34.57. J&J’s shares currently trade at 20.18 forward earnings, higher than the industry as well as the stock’s 5-year mean of 15.65.
J&J’s dividend yield is 2.2%, while Lilly’s is around 0.7%.
LLY or JNJ: Which is a Better Pick?
J&J outperformed financial expectations in 2025 and looks optimistic for continued strong momentum in 2026, with a target to generate around $100 billion in revenues in the year. J&J expects sales growth in both segments to be higher in 2026.
Despite headwinds like the legal battle surrounding its talc lawsuits, the Stelara patent cliff, the upcoming LOE of key drugs Opsumit and Simponi and softness in MedTech China, J&J looks quite confident that it will be able to navigate these challenges.
On the other hand, exceptional growth from Mounjaro and Zepbound has made Lilly the largest drugmaker. It delivered robust financial performance in 2025 with revenues surging 45% and EPS growing 86%. Expectations for continued growth in 2026 remain high with projected revenues of $80-$83 billion and EPS of $33.50-$35.00.
Lilly is a great stock to have in one’s portfolio, considering its product and pipeline portfolio in high-growth therapeutic areas like obesity, robust growth prospects and bullish analyst sentiment.
Choosing between Eli Lilly and J&J is probably the most difficult choice to make among large drug stocks. Both have seen steady growth in sales and earnings, rising stock prices and analyst estimates and have an optimistic outlook for 2026. Additionally, continued pipeline advancements, favorable regulatory developments, and strategic M&A activity have strengthened investor sentiment for both stocks.
Both stocks have a Zacks Rank #3 (Hold). However, we are selecting J&J over Lilly only due to its better stock price performance and valuation. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.