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Eli Lilly’s 4Q17 Estimates: Revenue Growth Expected

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Jan. 30 2018, Published 2:17 p.m. ET

Eli Lilly & Co.’s revenue estimates

Wall Street analysts estimate an ~3.1% increase in Eli Lilly & Co.’s (LLY) 4Q17 revenues to ~$5.9 billion. This increase follows the strong performance of several existing products as well as new products.

Eli Lilly’s products are sold in more than 120 countries, and its international sales contribute ~45.0% of its total revenues. As a result, the company is exposed to currency risk, and foreign exchange is expected to have a positive impact on its overall revenues for 4Q17. The chart below compares Eli Lilly’s (LLY) revenues since 4Q15 and its estimates for 4Q17.

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Segment-wise expectations for 4Q17

Eli Lilly’s (LLY) business is divided into two segments:

  • Human Pharmaceuticals under the brand Lilly
  • Animal Health Products under the brand Elanco

Eli Lilly’s recent growth in revenues was driven by the strong performance of several existing products and new products. This growth was partially impacted by lower sales of Cymbalta and several other drugs.

For 4Q17, the Human Pharmaceuticals segment is expected to report growth in revenues. This growth is driven by strong sales of Basaglar, Jardiance, Taltz, Trulicity, and Lartruvo. This growth was also due to higher realized prices of Humulin, Cialis, and Forteo.

However, lower sales from Strattera, Cymbalta, Humalog, and Alimta are expected to partially offset this growth during 4Q17. The overall contribution of the Human Pharmaceuticals segment is expected to comprise ~87.0% of the company’s total revenues during 4Q17.

Elanco, the company’s Animal Health segment, is expected to contribute ~13.0% of the total revenues for Eli Lilly in 4Q17. Analysts estimate its revenues to report growth in 4Q17 compared to 4Q16 due to the increase in sales volumes. These revenues are partially offset by lower realized prices.

This growth is expected to be driven by strong sales of companion animal products in the US markets, and food and other products in the international markets during 4Q17.

The iShares Global Healthcare ETF (IXJ) holds 1.6% of its total investments in Eli Lilly & Co. (LLY), 1.9% in GlaxoSmithKline (GSK), 2.1% in Bristol-Myers Squibb (BMY), and 3.3% in Merck & Co. (MRK).

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