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Analysts’ Recommendations for Eli Lilly and Peers in April


May. 1 2018, Updated 10:15 p.m. ET

Performance in 1Q18

On April 24, Eli Lilly (LLY) reported 1Q18 revenues of ~$5.7 billion, which represents year-over-year (or YoY) growth of ~9.0%. This growth was mainly attributable to the strong performance of products such as Trulicity, Taltz, Basaglar, Jardiance, and Trulicity, both in the US and in international markets.

While favorable foreign currency fluctuations had a beneficial impact of ~4.0%, price and volume contributed 3.0% and 2.0%, respectively, to the company’s YoY revenue growth rate in 1Q18.

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Eli Lilly posted non-GAAP (generally accepted accounting principles) gross margins of ~75.1% in 1Q18, which is a YoY decline of 270 basis points. Excluding the impact of foreign currency fluctuations, Eli Lilly’s gross margins have risen YoY by 70 basis points in 1Q18, mainly attributable to improving manufacturing efficiencies as well as higher realized drug prices. However, product mix had a negative impact on Eli Lilly’s gross margins in 1Q18.

Eli Lilly reported non-GAAP operating income of ~$1.4 billion in 1Q18, which is a YoY rise of 29.0%. Excluding the impact of foreign currency fluctuations on inventories sold in international markets, the company reported non-GAAP operating income margins of ~30.4%, which is a YoY increase of 775 basis points. The company also reported non-GAAP earnings per share (or EPS) of ~$1.16, which is a YoY rise of ~37.0%.

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Analysts’ recommendations for Eli Lilly

Of the 22 analysts covering Eli Lilly in April 2018, six recommended a “strong buy,” seven recommended a “buy,” eight recommended a “hold,” and one recommended a “sell.”

Analysts’ recommendations for peers

Of the 22 analysts covering Pfizer (PFE) in April 2018, 50.0% recommended a “buy.” About 40.0% of the 25 analysts covering GlaxoSmithKline (GSK) stock recommended a “buy,” and 40.0% of the five analysts tracking Sanofi (SNY) recommended a “buy.”

In the next article, we’ll discuss the revenue growth prospects for Eli Lilly in fiscal 2018.


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