[Weekly Stock Picks] Recruit Holdings (6098) Hits Limit-Up on a Profit Upgrade, While Eli Lilly (LLY) Nears an All-Time High on GLP-1 Strength

Hey everyone, Hirokichi here.

This week’s “Weekly Stock Picks” features two names: Recruit Holdings (6098) from the Japanese market and Eli Lilly (LLY) from the US market. Both stocks made big moves this month on the back of strong earnings, which I think makes for a clean example of good numbers translating directly into share price gains. Last week’s picks were Mitsubishi Heavy Industries and Palantir Technologies (you can find last week’s article here), and this earnings season keeps giving us plenty to talk about.

Japan pick: Recruit Holdings (6098) hits limit-up on earnings

Recruit Holdings is one of Japan’s largest HR services companies, running career-change websites and job-advertising businesses. Its subsidiary Indeed, one of the world’s largest job search platforms, has grown into a core pillar of the company’s earnings alongside its domestic HR technology business.

In its Q1 FY2027 (April-June) earnings released on August 7, revenue rose 18.9% year-over-year to ¥1,453.5 billion, and net profit jumped 67.5% to ¥202.6 billion. At the same time, the company sharply raised its full-year net profit forecast from ¥623.0 billion to ¥755.0 billion, a roughly 52% increase versus the prior fiscal year’s results (according to Nikkei). The Tokyo market responded on August 10, with Recruit Holdings shares opening strong and briefly hitting limit-up. The stock closed up 22.8% from the prior week’s close at ¥16,165 (according to Minkabu).

What’s behind Recruit’s strong results, and what investors should watch

Two factors drove the upward revision. First, the HR technology business centered on Indeed grew faster than expected. Second, the company revised its assumed exchange rate from ¥154 to ¥159 per dollar, a weaker-yen assumption.

On the positive side, having Indeed — one of the largest job search platforms in the world — alongside its domestic recruiting and job-advertising businesses gives Recruit a structure that can capture the recovery in overseas labor markets, particularly in the US, more easily than a purely domestic player.

On the other hand, it’s worth remembering that this limit-up move came from two catalysts stacking together: strong earnings and a weaker-yen assumption. In the short term, that combination can lead to profit-taking once the news is fully priced in, and if the yen strengthens again, it could work against results going forward. How much progress the company makes toward its newly raised full-year forecast in the next quarter is something I’ll keep watching.

US pick: Eli Lilly (LLY) nears an all-time high on GLP-1 strength

Eli Lilly is a major US pharmaceutical company known for its diabetes and obesity treatments. Its GLP-1 (glucagon-like peptide-1, a hormone involved in appetite suppression and blood sugar control) drugs Mounjaro and Zepbound have become its fast-growing flagship products.

In its Q2 2026 earnings released on August 5, revenue rose 48% year-over-year to $23.0 billion, and adjusted EPS (earnings per share) came in at $8.38, well above the $6.01 the market had expected (according to CNBC and the company’s earnings materials). Mounjaro sales rose 91% to $9.9 billion, while Zepbound brought in $4.93 billion, for a combined $14.9 billion from the two drugs. The company raised its full-year 2026 revenue guidance from a range of $82-85 billion to $85-87 billion. Shares rose 4% on the earnings news and have recently traded around $1,230, closing in on the 52-week high of $1,249.45.

Inside Lilly’s earnings, and what investors should watch

On the positive side, the global obesity-drug market keeps expanding, and Lilly has continued to ramp up supply, which suggests it can sustain a high growth rate for the time being. Beating both revenue and earnings estimates by a wide margin made this what I’d call a “clean” quarter, and that’s likely part of why the market reacted so well.

On the other hand, the stock is already trading near its 52-week high, meaning much of the growth story may already be priced in. Competition from other companies developing their own GLP-1 drugs, along with policy risk from potential US drug-pricing pressure, are both factors worth keeping an eye on going forward.

Comparing the stock reaction to each earnings report

Comparing how far each stock moved after its earnings release shows a clear contrast between the two. Recruit Holdings jumped 22.8% from the prior week’s close to hit limit-up, while Eli Lilly rose a more modest 4% the day after its report. What this tells me is that when two catalysts stack together — like a large upward revision plus a weaker-yen assumption for Recruit — the resulting move can be very large, whereas for a company like Eli Lilly that already has a huge market cap and is trading near its highs, even a strong quarter tends to produce a comparatively calmer reaction.

Three things to watch going forward

Going forward, I’ll be watching three things: (1) how much progress Recruit makes toward its newly raised full-year forecast in the next quarterly report, (2) how trial data and pricing negotiations play out for competing GLP-1 drugs relevant to Eli Lilly, and (3) how currency moves — specifically whether the yen stays weak against the dollar — continue to affect both companies’ results and share prices.

Stocks that make big moves around earnings are worth watching well past the initial reaction, including how they trade once the news is fully digested. I also post regular updates on my overall portfolio at my net worth summary page, so feel free to check that out too. If anything else catches my eye this week, I’ll bring it to you again next week. See you next time!

日本語版はこちら → Japanese version is here

* This article is for informational purposes only and does not recommend any specific investment. Please make investment decisions at your own responsibility.

Thanks for reading! If you enjoyed this post, a quick click on the banners below would really encourage me.