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Analyzing the Performance of Eli Lilly Stock in 1Q17

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A look at Eli Lilly and Company

Eli Lilly and Company (LLY) is a US pharmaceutical company dealing with both human pharmaceuticals and animal health.

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Stock price performance

Eli Lilly’s stock price rose ~13.3% in 1Q17. On April 6, 2017, it had risen 16.4% year-to-date (or YTD).

Analysts’ recommendations

Wall Street analysts estimate that the stock has the potential to return ~2.8% over the next 12 months. Analysts’ recommendations show a 12-month target price of $88.05 per share, compared to the stock’s price of $85.63 per share on April 5, 2017.

There are 22 analysts tracking Eli Lilly stock, and 77.3% of them recommend “buys,” while 22.7% recommend “holds.” The consensus rating for Eli Lilly stands at 1.9, which represents a “buy” for long-term growth investors.

Analysts’ revenue estimates

Eli Lilly’s revenue has risen in the past few quarters, mainly due to the strong performances of its pharmaceutical products including Trulicity, Humalog, Cyramza, Jardiance, Taltz, and Erbitux. However, a few drugs such as Cymbalta and Zyprexa are losing their sales to competition due to the loss of the exclusivity.

Analysts’ estimates show revenue of $5.2 billion for the company in 1Q17, a 7% rise over 1Q16. Analysts expect earnings per share (or EPS) of $0.96 for the company in 1Q17.

To divest company-specific risk, investors can consider ETFs such as the Fidelity MSCI Healthcare ETF (FHLC), which holds 2.2% of its total assets in Eli Lilly, 2.1% in Abbott Laboratories (ABT), 2.9% in Biogen (BIIB), and 3.1% in Bristol-Myers Squibb (BMY).

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