Last week, Eli Lilly reported its latest numbers. The stock surged after the company improved its outlook for 2024, elevated by the potential for their new weight-loss drugs. The stock rose as much as 7.9% on the news, the most intraday gain since August, and has nearly doubled over the past 12 months.

The sales of tirzepatide, the GLP-1 drug, comprised of $1.8 billion from Mounjaro (the diabetes version) and $517 million from Zepbound (the official weight loss version), were slightly below expectations due to supply constraints. However, these medications, along with the breast cancer drug Verzenio and the Boehringer Ingelheim-partnered Jardiance, contributed to a significant revenue increase of 26%, bringing total revenue for the quarter to $8.7 billion.

Demand for Lilly and Novo's weight-loss drugs remains solid, with both companies facing supply shortages. Analysts now view the estimate of $80 billion in annual obesity drug sales by 2030 as conservative. Excellent news for both companies.

The company anticipates significant production boosts in the latter half of the year for Zepbound and its associated diabetes medication Mounjaro.

Eli Lilly has been expanding its production capacity for diabetes and weight-loss drugs over the past four years. The company plans to initiate production from one of its newly upgraded facilities in North Carolina later this year, with others expected to come online starting in 2025. Additionally, Lilly recently acquired a manufacturing plant in Wisconsin, expected to commence production by the end of 2025.

While Lilly's weight-loss drug success is notable, the company faces delays in gaining US clearance for its experimental Alzheimer's disease treatment, donanemab. The biotech giant remains confident in donanemab's potential, despite concerns raised by the FDA about its safety and efficacy.

Eli Lilly is also exploring additional medical benefits of its GLP-1 drugs beyond diabetes and weight loss, such as potential heart-protective properties, which could broaden insurance coverage. The company also expects Zepbound to gain coverage for Medicare patients once approved for obstructive sleep apnea, following positive late-stage data in April.

The skyrocketing demand for both drugs, known chemically as tirzepatide, has propelled Eli Lilly's market value above $720 billion, surpassing that of Tesla and Walmart. We're still of the opinion that the market hasn't fully recognised Eli Lilly's potential, presenting a buying opportunity for those who don't already own shares in the company.

The culture of a nation, its attitude to work and saving leads to different results. I'm currently in Asia, where everyone seems to be working very hard, mostly making food or repairing motorcycles.

Consider the chart of Europe below. Of the major nations, the UK has the highest median wealth per adult, probably because they have an individualistic, entrepreneurial culture and a positive view of home ownership.

The Swedes are next, with a small, industrious population. The French have a very productive labour force, when they are working.

Germany is an enigma, way down the list median wealth per adult list. Apparently, that's because "they prefer to rent instead of buying property, prefer savings accounts with negative real interests over equities and spend more than others on insurance due to the famous German angst."

Operating cashflow is a very important metric to look at when valuing a company. The definition of operating cashflow is the amount of cash generated by a company's normal business operations. It does not get simpler or more transparent than that. If a company does not have positive cash flows, they will eventually need more money, be it through debt or equity.

You will therefore be happy to know that Vestact recommended stocks hold the top 5 rankings for operating cash flows over the last 12 months, of companies within the S&P500. The usual names are there, which is not surprising. Big established tech companies are cash-generating machines, and that is why we like them.

Would you eat lab-grown meat? What would you do if it was easily available and comparably priced to normal meat? I would probably eat lab-grown meat if it had the same texture and taste as normal meat. If it tasted like chemicals or was really tough, then no thanks.

In a scenario where the two options were very similar, I think the version that doesn't involve the death of Daisy the cow is preferable. My guess is that lab meat would be more environmentally friendly too. Due to these factors, I think it will be a very big industry in the future.

Interestingly, Florida has just banned the sale of lab-grown meat. The state has a large cattle industry, so in a move to protect that industry, Gov Ron DeSantis is banning lab-grown meat sales. Given that this new meat won't be a threat for at least another decade or two, I think this banning is silly. Florida is effectively saying that it wants to be left behind on any change in the industry. It would be like a state banning the sale of cars because it threatened the horse industry.

You can read more here - Florida becomes first state to ban the sale of lab grown meat.

Higher education is not for all of us. A lot of Gen-Z are getting skilled trades instead of going to university - The case for skilled career paths.

The tech titans are spending billions building AI capabilities. The trick is to monetise these very expensive investments - Coca-Cola signs $1.1 billion deal with Microsoft for AI access to help streamline operations.

Asian markets are mostly in the green this morning. Benchmarks rose in India, Japan, and South Korea, but fell in Hong Kong and mainland China.

US equity futures are little changed pre-market. The Rand is trading at around R18.49 to the US Dollar.

Today Disney, Ferrari, and Southeast Asian e-commerce giant Coupang report their quarterly earnings. Not much going on for Vestact clients.

Many in Gauteng are back to school and work today. Give it horns.