This Unstoppable Healthcare Stock Just Made a Game-Changing AI Move: Time to Buy?

Healthcare meets AI in a seismic shift that's rattling traditional finance corridors.

BREAKING: Medical Giant Leaps Into Artificial Intelligence

The healthcare sector just got a digital transfusion—one major player is deploying AI across its entire operational framework. Think diagnostic algorithms that outperform human specialists, predictive analytics that slash wait times, and automated systems that reduce administrative overhead by staggering margins.

Why This Isn't Just Another Tech Gimmick

Unlike crypto bros chasing the next meme coin, this move leverages actual infrastructure. No speculative tokens, no empty promises—just hard metrics and scalable solutions. The AI integration targets real-world pain points: patient outcomes, operational efficiency, and cost reduction.

Wall Street's Watching—But Should You?

Traditional analysts might dismiss this as another 'tech trend,' but that's why they're still arguing about dividend yields while disruption happens under their noses. This isn't about jumping on a bandwagon—it's about a fundamental recalibration of healthcare delivery.

Time to buy? If you still think innovation is measured in P/E ratios alone, maybe stick to bonds.

Accelerating drug discovery

Developing novel medicines is expensive and time-consuming. Most drugs that reach the clinical trial phase, which typically involves three stages and costs hundreds of millions of dollars, never make it to the market.

Several companies are already attempting to address this problem through AI-powered models, and Eli Lilly is now among them. On Sept. 9, the company announced the launch of TuneLab, an AI-powered drug discovery platform.

Image source: Getty Images.

Eli Lilly will grant access to TuneLab to select biotech companies free of charge. The company's goal is twofold. First, to help accelerate the drug discovery process by predicting which compounds are more likely to prove SAFE and effective once they move into clinical trials, thereby reducing the failure rate of new products entering clinical studies. Second, Eli Lilly aims to lend a helping hand to smaller biotechs that lack the resources to develop their own AI models.

Of course, the pharmaceutical giant is getting something out of it. Having trained its drug discovery AI models on its own data for years, Eli Lilly will be able to access more data from the biotech companies using TuneLab -- and all that without having to spend the money it typically needs to generate said data. That way, the drugmaker can fine-tune its drug discovery algorithms at a low cost and improve its already impressive drug innovation engine.

What it means for investors

This development won't move the needle for Eli Lilly anytime soon, but it highlights once again that the company is planning for the long term.

The drugmaker is currently experiencing tremendous success in the areas of diabetes and weight management. Second-quarter revenue grew by 38% year over year to $15.6 billion, while its non-GAAP (generally accepted accounting principles) earnings per share climbed 61% year over year to $6.31.

However, Eli Lilly isn't resting on its laurels and is instead looking at the next stage of growth beyond its current crop of medicines and late-stage drug candidates.

Over the past year or so, the company has made several moves to enhance its pipeline through licensing deals and acquisitions, including those outside of its Core therapeutic area of expertise.

In May, Eli Lilly announced its acquisition of SiteOne Therapeutics, a small biotech company with a promising non-opioid pain medication in development. The deal cost Eli Lilly about $1 billion in upfront cash. Verve Therapeutics, another biotech company acquired by Eli Lilly in July for $1.3 billion, is working on genetic therapies for cardiovascular diseases.

Eli Lilly is casting a broad net precisely because of the uncertainty involved in developing medicines, even when they have already reached phase 2 studies. The company's TuneLab initiative could address this shortcoming over the long run and, eventually, allow the drugmaker to launch just as many blockbusters but at a lower cost, thereby improving its margins and bottom line.

Even if TuneLab doesn't deliver on that promise, Eli Lilly's rich lineup, which is helping it deliver revenue and earnings growth well above industry averages, along with a DEEP pipeline, makes the stock attractive. Some might complain that the company is trading at 25 times forward earnings, which is well above the healthcare industry's average of 16.5.

That is well warranted, though, when you look at Eli Lilly's financial results and prospects, which put those of most similarly sized peers to shame. Eli Lilly remains an excellent stock to buy at current levels. The TuneLab initiative only emphasizes what we already know about the company's outstanding management team.