Eli Lilly (LLY) is benefiting from the "broadening" GLP-1 market for obesity and type-2 diabetes, Morgan Stanley said.

The brokerage said in a Sunday note that the glucagon-like peptide-1, or GLP-1, market will continue to grow for both obesity and type-2 diabetes.

Results from Morgan Stanley's survey suggest that Lilly could continue to gain market share versus Novo Nordisk (NVO) in these areas, with its Orfor drug potentially representing about 30% of the company's total GLP-1 mix a year after launch.

The investment firm now expects the company to post revenue of $134 billion in 2030, up from a prior estimate of $115 billion. They project a 2030 operating margin of 56% and raised their earnings estimate to about $70 per share, up from $59 previously.

The next catalysts for the Eli Lilly stock include phase 3 data from its Retatrutide weight-loss drug and phase 3 data from Novo Nordisk's Evoke Alzheimer's study, both expected in Q4.

Morgan Stanley raised the stock's price target to $1,290 from $1,171 and retained an overweight rating.

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