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Pfizer or Eli Lilly: Who Is Expected to Report Higher EPS Growth?

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EPS guidance for fiscal 2019

In its fourth-quarter earnings conference call, Pfizer (PFE) has guided for non-GAAP diluted EPS of $2.82–$2.92 for fiscal 2019 excluding the impact of profits and losses associated with equity investments but including the negative impact of $0.06 associated with foreign exchange. The company has also guided for $9 billion worth of share repurchases in fiscal 2019.

In its fourth-quarter earnings investor presentation, Eli Lilly (LLY) has guided for GAAP EPS of $4.57–$4.67 for fiscal 2019, a significant decline from the prior guidance of $5.52–$5.62 despite being a sturdy YoY rise of 46%–49%. This drop is attributable to the setback in the company’s Lartruvo research program as well as the impact of the recently announced acquisition of Loxo Oncology. To know more about Eli Lilly’s deal with Loxo Oncology, read Eli Lilly Is Set to Acquire Loxo Oncology.

 

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The company has also guided for non-GAAP EPS of $5.55–$5.65 for fiscal 2019, which is lower than the prior guidance of $5.90–$6.00, and a YoY rise of 0%–2%. According to the company’s fourth-quarter earnings conference call, Eli Lilly expects a $0.34 per share negative impact on the fiscal 2019 non-GAAP EPS due to the Loxo Oncology acquisition, which is expected to be completed in the first quarter of 2019.

On January 18, the company issued a press release announcing unfavorable results from the Phase 3 trial, ANNOUNCE, evaluating the Lartruvo-doxorubicin combination regimen in advanced or metastatic soft tissue sarcoma indication. The company expects a $0.17 per share negative impact on fiscal 2019 non-GAAP EPS associated with results announced for the Phase 3 Lartruvo trial.

Wall Street’s projections

Analysts expect Pfizer’s non-GAAP EPS to drop 2.47% YoY to $0.75 in the first quarter, then fall 3.84% YoY to $2.88 in fiscal 2019, then rise 5.86% YoY to $3.05 in fiscal 2020, and then rise 10.73% YoY to $3.38 in fiscal 2021.

Analysts expect Eli Lilly’s non-GAAP EPS to drop 2.27% YoY to $1.31 in the first quarter but rise 0.94% YoY to $5.60 in fiscal 2019, 16.82% YoY to $6.54 in fiscal 2020, and 11.93% YoY to $7.33 in fiscal 2021.

In addition to having higher absolute EPS, Wall Street analysts also expect Eli Lilly to grow its EPS at a faster rate as compared to Pfizer until 2021.

Next, we’ll discuss expense projections for Pfizer and Eli Lilly in fiscal 2019.

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