Eli Lilly Set for Impressive Earnings Report Amid Strong Growth Prospects
Eli Lilly and Company (LLY), a top player in healthcare innovation, is known for developing vital medicines that tackle critical medical challenges. Headquartered in Indianapolis, Indiana, the company has a market capitalization of $759.4 billion and operates in various therapeutic areas, including oncology, diabetes, immunology, and neuroscience. As anticipation builds, Eli Lilly is preparing to announce its Q4 earnings on Tuesday, Feb. 4.
Anticipated Earnings Surge
Analysts predict Eli Lilly will report earnings of $5.43 per share, reflecting a substantial increase of 118.1% from $2.49 per share during the same period last year. Over the past four quarters, the company exceeded expectations in three instances, while falling short once. Its EPS for the last reported quarter was $1.18, which missed consensus estimates by 22.4%. This shortfall was attributed to decreased inventory among wholesalers, affecting sales of Zepbound and Mounjaro, although both drugs demonstrated strong growth compared to the previous year.
Future Projections Show Continued Growth
Looking ahead, analysts forecast Eli Lilly’s EPS to reach $13.14 in fiscal 2024, marking a 107.9% increase from the $6.32 reported in 2023. By fiscal 2025, EPS is expected to grow to $24.03, representing an 82.9% annual rise.
Stock Performance and Market Comparison
Eli Lilly’s shares have climbed 26.9% over the past year, outperforming the S&P 500 Index’s increase of 21.8% and the slight decline of the Health Care Select Sector SPDR Fund (XLV) during the same timeframe.
Strong Demand and Strategic Approvals Fuel Growth
The demand for Eli Lilly’s leading drugs, particularly Mounjaro for type 2 diabetes and Zepbound for weight loss, drives substantial sales growth. Recent FDA approvals for significant drugs such as Omvoh, Jaypirca, donanemab, and Ebglyss, along with targeted research and development investments and expanded production capabilities, have also played a crucial role in the company’s growth trajectory.
Mixed Earnings Report but Analysts Stay Positive
Despite a strong product lineup and promising future developments, Eli Lilly’s shares fell by 6.3% after its Q3 earnings miss on Oct. 30, which reported revenue of $11.4 billion, below the estimated $12.1 billion. The drop in U.S. inventories impacted its overall performance despite robust sales of its key drugs. Nonetheless, analysts remain optimistic about the growth potential in Lilly’s diabetes, obesity, and Alzheimer’s treatment sectors.
Analysts Maintain a Strong Buy Consensus
The overall sentiment among analysts regarding LLY stock is bullish, earning a “Strong Buy” rating overall. Out of 25 analysts monitoring the stock, 20 recommend a “Strong Buy,” one suggests a “Moderate Buy,” while four advise a “Hold.” The average analyst price target stands at $1,005.42, indicating a potential upside of 25.7% from current levels.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any 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.
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