What Analysts Think of Eli Lilly Stock Ahead of Earnings
Eli Lilly (LLY) is poised to report its fourth-quarter earnings before the market opens on Thursday, and analysts are optimistic about the company’s prospects. With rising sales and profit expected in the first full quarter since the company’s weight-loss drugs were declared no longer in shortage, Eli Lilly’s stock is under scrutiny.
Analysts’ Ratings and Price Targets
A total of 11 analysts who follow Eli Lilly and are tracked by Visible Alpha have weighed in on the company’s stock. The consensus is overwhelmingly bullish, with 10 analysts rating the stock as a “buy” and one analyst assigning a “hold” rating. The lone hold rating is also the only analyst with a price target below the stock’s current level.
The average price target for Eli Lilly’s stock is nearly $986, representing a premium of approximately 19% above Tuesday’s closing price. This suggests that analysts believe the company’s stock has significant upside potential.
Revenue and Earnings Expectations
Eli Lilly is expected to report revenue of $13.56 billion for the fourth quarter, representing a year-over-year increase of 45%. This growth is largely driven by the company’s weight-loss drugs, Zepbound and Mounjaro, which have been in high demand.
Net income is projected to more than double from the same time last year to $4.52 billion, or $4.99 per share, according to estimates compiled by Visible Alpha.
Earnings Follow Lowered Sales Forecast
Eli Lilly’s earnings report comes after the company lowered its sales forecast for the fourth quarter. In January, the company announced that sales of Mounjaro and Zepbound had grown slower than expected, with fourth-quarter and full-year revenue expected to come in around $13.5 billion and $45 billion, respectively.
CEO David Ricks also stated that the company expects production of “salable doses” of its weight-loss drugs to be 60% higher in the first half of this year compared with the same period in 2024.
Competition and Supply Chain Challenges
Eli Lilly faces intense competition in the weight-loss drug market from rival Novo Nordisk (NVO), which makes Ozempic and Wegovy. Both companies have struggled to keep up with demand for their weight-loss drugs, leading to supply chain challenges.
However, Eli Lilly’s weight-loss drugs were removed from the Food and Drug Administration’s shortage list late last year, and the company has invested heavily in increasing its production capacity.
Key Takeaways
– Analysts are overwhelmingly bullish on Eli Lilly’s stock, with 10 “buy” ratings and one “hold” rating.
– The average price target for Eli Lilly’s stock is nearly $986, representing a premium of approximately 19% above Tuesday’s closing price.
– Eli Lilly is expected to report revenue of $13.56 billion for the fourth quarter, representing a year-over-year increase of 45%.
– Net income is projected to more than double from the same time last year to $4.52 billion, or $4.99 per share.
Recommendations
Based on the analysts’ ratings and price targets, it appears that Eli Lilly’s stock has significant upside potential. Investors may want to consider adding Eli Lilly to their portfolios, given the company’s strong growth prospects and the analysts’ bullish sentiment.
However, it’s essential to keep in mind that the company faces intense competition in the weight-loss drug market, and supply chain challenges may persist. Investors should carefully evaluate these risks and consider their own investment goals and risk tolerance before making any decisions.
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EXCERPT
What Analysts Think of Eli Lilly Stock Ahead of Earnings Eli Lilly (LLY) is set to report fourth-quarter earnings before the bell Thursday, with analysts expecting rising sales and profit in the first full quarter since the company’s weight-loss drugs were declared no longer in shortage.1
Analysts are bullish on the maker of weight-loss drugs Zepbound and Mounjaro, with 10 of the 11 analysts who follow the company and are tracked by Visible Alpha rating Eli Lilly stock as a “buy,” along with one “hold” rating. The lone hold rating is also the only analyst with a price target below the stock’s current level, with the average price target at almost $986—a premium of about 19% above Tuesday’s closing price.
Eli Lilly is expected to report $13.56 billion in revenue, up 45% year-over-year as the weight-loss drugs have boosted Eli Lilly’s revenue over the last several quarters. Net income is projected to more than double from the same time last year to $4.52 billion, or $4.99 per share, according to estimates compiled by Visible Alpha.2
Eli Lilly. “Lilly Reports Strong Fourth-Quarter 2023 Financial Results and Provides 2024 Guidance.”
Earnings Follow Lowered Sales ForecastEli Lilly’s earnings comes after the drugmaker again lowered expectations for its fourth-quarter sales last month and its third-quarter results disappointed in October.
The company said in January that sales of Mounjaro and Zepbound had grown slower than expected in the latest quarter, with fourth-quarter and full-year revenue expected to come in around $13.5 billion and $45 billion, respectively. CEO David Ricks also said in January that the company expects production of “salable doses” of its weight-loss drugs to be 60% higher in the first half of this year compared with that period in 2024.3
Eli Lilly and weight-loss drugmaker rival Novo Nordisk (NVO), which makes Ozempic and Wegovy, have watched demand continuously outpace their supply of the weight-loss drugs. Lilly’s drugs were removed from the Food and Drug Administration’s shortage list late last year, and the companies have each spent billions on increasing their production capacity.
Source: Investopedia
