Eli Lilly (LLY) stock is rallying more than 5% in Thursday's session after the pharmaceutical giant reported strong first-quarter earnings results and raised its full-year outlook.
In the three months ended March 31, Eli Lilly's revenue increased 26% from the year-ago period to $8.8 billion. Earnings per share (EPS) surged 59.3% to $2.58.
"Lilly's first-quarter performance reflects solid year-over-year revenue growth with strong sales of [weight-loss drugs] Mounjaro and Zepbound," Eli Lilly CEO David A. Ricks said in a statement. "Our progress in addressing some of the world's most significant healthcare challenges has resulted in increased demand for our medicines."
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The Q1 results were mixed compared with analysts' expectations, which called for revenue of $8.9 billion and EPS of $2.46, according to Yahoo Finance.
Still, Eli Lilly's weaker-than-expected revenue was quickly overlooked after the company increased its full-year outlook. The drugmaker now expects full-year revenue in the range of $42.4 billion to $43.6 billion and earnings to arrive between $13.50 to $14.00 per share. This is up from LLY's previous outlook for revenue in the range of $40.4 billion to $41.6 billion and earnings of $12.20 to $12.70 per share.
"As we continue to make pipeline investments that position us for future growth, we are rapidly expanding manufacturing capacity to make our incretin medicines available to more patients," Ricks said.
Where does Eli Lilly stock stand with analysts?
Analysts were already bullish on the healthcare stock ahead of earnings. According to S&P Global Market Intelligence, the consensus analyst target price for LLY shares is $813.32, representing an upside of just over 5% to current levels. Meanwhile, the consensus recommendation is a Buy.
However, Damien Conover, director of equity strategy at Morningstar, believes Eli Lilly stock was running a little hot ahead of earnings.
"With its 2-star rating, we believe Eli Lilly's stock is overvalued compared with our long-term fair value estimate of $500," Conover said. The $500 estimate represents a downside of more than 35% to current levels.
Related Content
-
Is Your Social Security Earnings Record Wrong? Here's How to Fix ItYour Social Security benefits are based on your Social Security earnings record. It's important to review your records to avoid having your benefits reduced.
-
Stock Market Today: Markets Discount Another U.S. DowngradeAfter Friday's closing bell, Moody's followed Standard & Poor's and Fitch and cut its rating on U.S. government debt.
-
Stock Market Today: Markets Discount Another U.S. Downgrade
After Friday's closing bell, Moody's followed Standard & Poor's and Fitch and cut its rating on U.S. government debt.
-
Donating Complex Assets Doesn't Have to Be ComplicatedIf you're looking to donate less-conventional assets but don't know where to start, this charity executive has answers, such as considering a donor-advised fund (DAF) for its tax benefits and ease of use.
-
What's Next for Stocks After a Chaotic SpringA chaotic tariff policy buffets investors looking for clarity on the economy and inflation.
-
Think a Repeal of the Estate Tax Wouldn't Affect You? WrongThe wording of any law that repeals or otherwise changes the federal estate tax could have an impact on all of us. Here's what you need to know, courtesy of an estate planning and tax attorney.
-
In Your 50s? We Need to Talk About Long-Term CareMany people don't like thinking about long-term care, but most people will need it. This financial professional recommends planning for these costs as early as possible to avoid stress later.
-
Where to Invest in an Uncertain MarketIn an uncertain market, you can still pocket juicy payouts ranging from 4% to 14%, depending on risk.
-
My First $1 Million: Events Industry CEO, 65, Northern New JerseyEver wonder how someone who's made a million dollars or more did it? Kiplinger's My First $1 Million series uncovers the answers.
-
Social Security Pop Quiz: Are You Among the 89% of Americans Who'd Fail?Shockingly few people have any clue what their Social Security benefits could be. This financial adviser notes it's essential to understand that info and when it might be best to access your benefits.
