Eli Lilly and Merck take center stage as Zacks points to a 2026 health-care seasonal tailwind

Health care is often viewed as a defensive corner of equities, but a new Zacks Investment Ideas feature makes the case that 2026 is different, tying that defensiveness to a predictable seasonal pattern. The article says the sector’s “seasonal strength” typically runs from late spring into fall, overlapping with major medical and scientific conferences that can bring steady visibility for clinical data and regulatory milestones. It also frames the 2026 setup as a rotation opportunity, pointing to a midterm-election year dynamic and easing policy overhangs as reasons investors may be more willing to turn toward health care now.

Within that view, Eli Lilly (LLY) is portrayed as the growth engine of the group. Zacks emphasizes that Lilly’s incretin franchise, particularly Mounjaro and Zepbound, has fueled a “hypergrowth” narrative. In Lilly’s own first-quarter 2026 results, the company reported revenue of $19.8 billion, up 56% year over year, and non-GAAP earnings per share of $8.55. Lilly also raised its full-year 2026 guidance, moving revenue outlook to $82 billion to $85 billion and non-GAAP EPS to $35.50 to $37.00.

Zacks further argues that Lilly’s momentum is visible in both operating metrics and Wall Street estimate trends. The feature says Lilly held roughly 60% of the U.S. obesity and diabetes drug market in the first quarter, ahead of Novo Nordisk, and it highlights that Lilly’s first-quarter results exceeded consensus expectations. It also notes that the Zacks Consensus mark for Lilly’s 2026 earnings has been revised upward sharply, positioning the stock as a potential leader during the seasonal window.

Merck (MRK) is presented as a counterweight to Lilly’s growth profile, with the Zacks piece focusing on stability plus pipeline optionality. Merck’s first-quarter 2026 performance showed worldwide sales of $16.3 billion, up 5%, with KEYTRUDA family sales of $8.0 billion. Merck’s earnings presentation describes KEYTRUDA growth as driven by demand across metastatic indications and by uptake in earlier-stage cancers.

Beyond the Keytruda franchise, Zacks leans on pipeline expansion to argue Merck can defend its longer-term growth narrative. The Zacks article says Merck’s Phase III pipeline has nearly tripled since 2021 and that the company plans to launch 20 new drugs by 2030. In Merck’s own messaging for the quarter, the company also points to substantial later-stage activity, describing about 80 Phase 3 studies ongoing and projecting potential commercial opportunity of more than $70 billion by the mid-2030s from “new growth drivers.”

Taken together, the feature is essentially a two-pronged bet on timing and breadth. It suggests that the seasonal tailwind and conference-driven visibility could support broad health-care interest, while Lilly and Merck represent distinct ways to participate: Lilly through continuing scale-up of its incretin franchise and upward guidance momentum, and Merck through a portfolio intended to extend value beyond Keytruda’s maturity. The article also underscores that health care demand is less tied to economic cycles than many other industries.

What is not fully settled in the Zacks post is the level of detail behind those longer-term pipeline claims. While Merck’s materials quantify parts of its Phase 3 footprint and potential value from new drivers, neither that post nor the quarter’s highlights guarantee trial outcomes, label expansion timelines, or commercial uptake. And while Zacks treats seasonality as a “tendency” rather than a promise, investors could see sharp reversals if broader risk appetite returns faster than expected.