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Eli Lilly (LLY) Outpaces Stock Market Gains: What You Should Know

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Eli Lilly (LLY - Free Report) closed at $327.18 in the latest trading session, marking a +0.76% move from the prior day. This change outpaced the S&P 500's 0.16% gain on the day. At the same time, the Dow lost 0.42%, and the tech-heavy Nasdaq gained 0.48%.

Coming into today, shares of the drugmaker had gained 7.04% in the past month. In that same time, the Medical sector lost 1.13%, while the S&P 500 lost 6.79%.

Eli Lilly will be looking to display strength as it nears its next earnings release. On that day, Eli Lilly is projected to report earnings of $1.86 per share, which would represent a year-over-year decline of 0.53%. Our most recent consensus estimate is calling for quarterly revenue of $6.9 billion, up 2.34% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.29 per share and revenue of $29.09 billion. These totals would mark changes of +1.59% and +2.72%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Eli Lilly. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.37% higher within the past month. Eli Lilly is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, Eli Lilly is holding a Forward P/E ratio of 39.15. Its industry sports an average Forward P/E of 13.23, so we one might conclude that Eli Lilly is trading at a premium comparatively.

It is also worth noting that LLY currently has a PEG ratio of 2.25. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Large Cap Pharmaceuticals was holding an average PEG ratio of 2 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 95, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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