Eli Lilly and Company (NYSE:LLY) Stock Price Up 1.7% - Should You Buy?

Eli Lilly and Company (NYSE:LLY) saw an increase of 1.7% in its stock price on Thursday. The stock reached a high of $792.56 and was last seen trading at $786.15. Around 3,476,307 shares changed hands during the trading session, marking an 18% rise above the average daily volume of 2,956,768 shares. The previous close was noted at $773.29.

Wall Street Analysts Forecast Growth

Many Wall Street analysts are sharing their views on Eli Lilly's stock, offering a positive outlook. Truist Financial recently raised their target price from $1,000.00 to $1,033.00, assigning a "buy" rating in a report dated October 10th. Additionally, Redburn Atlantic upgraded their rating for Eli Lilly to "hold" as of November 4th. Also, Cantor Fitzgerald maintained an "overweight" rating with a price target of $885.00 in a report on September 16th. Citigroup significantly increased their target from $1,060.00 to $1,250.00, also rating it a "buy" in a research note on October 25th. Bank of America reaffirmed a "buy" stance with a target of $997.00 in a note published on December 10th. In total, four equity research analysts have given a hold rating, and eighteen have designated it as a buy, leading to an overall consensus rating of "Moderate Buy" along with an average price target of $1,002.22.

Eli Lilly and Company Price Performance

The stock's moving averages show a 50-day average of $787.35 and a 200-day average of $861.17. In terms of liquidity and financial stability, the company has a current ratio of 1.27, a quick ratio of 0.97, and a debt-to-equity ratio standing at 2.03. Eli Lilly boasts a robust market capitalization of $746.30 billion, with a price-to-earnings (P/E) ratio of 84.99 and a P/E growth (P/E/G) ratio of 2.99. Moreover, the stock has a beta value of 0.41, indicating lower volatility compared to the broader market.

The latest quarterly earnings report from Eli Lilly was released on October 30th, highlighting an earnings per share (EPS) of $1.18. This result fell short of analysts' expectations, which had been set at $1.52, a difference of $0.34. Despite the miss, the company reported a net margin of 20.48% and a remarkable return on equity of 71.08%. The reported revenue stood at $11.44 billion, which also lagged behind the consensus estimate of $12.09 billion. However, revenue showed a solid year-over-year increase of 20.4%, with an EPS rise from $0.10 from the previous year. For the current fiscal year, analysts anticipate an EPS of 13.18.

Eli Lilly and Company Increases Dividend

In addition to recent stock price movements, Eli Lilly announced a quarterly dividend to be paid on March 10th. Shareholders of record on February 14th will receive a dividend of $1.50 per share, translating to an annualized dividend of $6.00, reflecting a yield of 0.76%. This marks an increase from the previous dividend of $1.30 per share. The ex-dividend date is also set for February 14th, and the company's dividend payout ratio is currently 64.86%.

Company's Share Buyback Initiative

Furthermore, Eli Lilly's board of directors initiated a significant share buyback program on December 9th, authorizing the repurchase of up to $15.00 billion in shares. This plan indicates the management's belief that the stock is undervalued, allowing the company to buy back up to 2% of its stock via open market purchases.

Insider Activity

On the insider trading front, CAO Donald A. Zakrowski sold 900 shares on November 8th, fetching an average price of $803.38, totaling $723,042. Post-sale, Zakrowski retains 5,480 shares valued at approximately $4.4 million. This transaction represented a 14.11% decrease in his ownership of the stock. Disclosure of such insider trading can be found in filings with the SEC.

Institutional Investors' Movements

In the realm of institutional investors, there have been notable shifts in holdings. For instance, International Assets Investment Management LLC ramped up its stake in Eli Lilly by 87,091.7% during the third quarter, accumulating 12,463,182 shares worth over $11 billion after acquiring an additional 12,448,888 shares. Pathway Financial Advisers LLC also increased its stake significantly by 92,759.9% in the same quarter, now holding 1,022,388 shares valued at approximately $905.77 million. Other significant stake increases were reported by Wulff Hansen & Co. and Integrated Investment Consultants LLC, among others. Currently, institutional investors and hedge funds control about 82.53% of Eli Lilly's stock, underscoring confidence in the company's future prospects.

Eli Lilly and Company Company Overview

Eli Lilly and Company focuses on discovering, developing, and marketing pharmaceuticals worldwide. Their product offerings encompass insulin treatments for diabetes, medication for Type 2 diabetes, and obesity management solutions.

Final Thoughts: Should You Invest?

As the stock trades at $786.15, potential investors might wonder if this is the right time to buy. With an overall "Moderate Buy" rating from analysts and an average price target above the current price, Eli Lilly may seem attractive. However, given the mixed earnings and market conditions, potential buyers should consider their investment objectives carefully before proceeding.

Eli, Lilly, Stock