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Headquartered in Indianapolis, Indiana, Eli Lilly and Company (LLY) is a leading biopharmaceutical firm with a market cap of $789.4 billion. Eli Lilly is dedicated to discovering and delivering innovative treatments for complex health conditions, primarily focusing on diabetes, oncology, immunology, and neuroscience. Eli Lilly aims to improve patients' lives worldwide through cutting-edge research and development.
Shares of Eli Lilly have underperformed the broader market over the past year. The stock has gained 34.3% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 36.8%. However, in 2024, LLY is up 42.7% compared to SPX’s 25.7% rise on a YTD basis.
Narrowing the focus, LLY has also outperformed the iShares U.S. Pharmaceuticals ETF’s (IHE) 13.3% returns on a YTD basis and 19.9% gains over the past year.
Eli Lilly's growth is fueled by high demand for its key drugs, Mounjaro (for type 2 diabetes) and Zepbound (for weight loss), generating impressive sales, alongside FDA approvals for key drugs like Omvoh, Jaypirca, donanemab, and Ebglyss, supported by strategic R&D investments and expanded manufacturing.
Despite a diversified portfolio and a promising pipeline, shares of the drug manufacturer dropped 6.3% after its Q3 earnings result on Oct. 30, missing Wall Street’s expectations. While its key drugs saw strong sales, inventory reductions in the U.S. impacted overall results. Despite this setback, analysts highlight the growth potential in Lilly's diabetes, obesity, and Alzheimer’s treatments.
For the current fiscal year, ending in December, analysts expect LLY’s EPS to grow 109% to $13.21 on a diluted basis. The company's earnings surprise history is mixed. It beat the consensus estimate in three of the past four quarters while missing estimates on another occasion.
Among the 25 analysts covering LLY stock, the consensus rating is a “Strong Buy.” That’s based on 21 “Strong Buy” ratings, one “Moderate Buy,” and three “Holds.”
This configuration is slightly more bullish than three months ago, with 18 suggesting a “Strong Buy.”
On Nov. 5, Srikripa Devarakonda from Truist Financial maintained a “Buy” rating on Eli Lilly, with a price target of $1,029, which indicates a 23.7% upside from the current levels.
The mean price target of $1,019.83 represents a 22.6% premium to LLY’s current price levels. The Street-high price target of $1,250 suggests an upside potential of 50.3%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
