Befitting a non-tech name that has managed to keep up with the AI-focused rally seen over the past year, Eli Lilly’s (NYSE:LLY) 2024 has kicked off in similar fashion to 2023. The stock has been a gainer in the early innings of the year and the pharma giant’s latest quarterly results further buoyed already upbeat sentiment.
The company’s Q4 results exceeded expectations, boosted by its GLP-1 agonists. Mounjaro and Zepbound, treatments for diabetes and weight loss, respectively, delivered the goods and some in the quarter. Mounjaro generated sales of $2.2 billion ahead of the Street at $1.8 billion, while Zepbound’s haul following its recent launch totaled $175.8 million, outpacing the Street’s $140.7 million forecast. These helped offset the decline in the blockbuster diabetes drug Trulicity, whose sales fell by 14% year-over-year to $1.7 billion.
The end result was revenue of $9.35 billion, amounting to a 28.1% YoY increase and beating the Street’s forecast by $380 million. Likewise, at the bottom line, adj. EPS of $2.49 came in $0.12 above consensus.
Looking ahead, powered by its new products while also somewhat offset by an anticipated drop in Trulicity sales, 2024 revenue is expected to hit the range between $40.4–41.6 billion, also above Wall Street’s forecast of $39.1 billion.
Depending on the supply ramp, Morgan Stanley analyst Terence Flynn thinks that revenue guide could prove to be conservative. In fact, following the latest print and guide, Flynn is now expecting a “modestly faster supply ramp for autoinjectors” compared to his prior model.
“Bottom line,” says the analyst, “we reiterate our Overweight rating on LLY following 4Q results as we expect Mounjaro/Zepbound launch to drive upward revisions to revenue estimates and drive margin expansion, albeit at a more measured pace in 2024, and the company has the strongest growth profile within our coverage universe.”
That Overweight (i.e., Buy) rating is backed by a new price target from Flynn. The figure goes from $763 to $805, suggesting the stock has room for further growth of ~9% in the year ahead. (To watch Flynn’s track record, click here)
Looking at the consensus breakdown, the Street generally agrees with Flynn’s take. Based on 18 Buys vs. 2 Holds, the stock claims a Strong Buy consensus rating. However, given the big share gains of the past 12 months (up by 115%), the $761 average target implies the stock has a modest upside of less than 3%. It will be interesting to see whether other analysts follow in Flynn’s footsteps and raise their price targets shortly. (See Eli Lilly stock forecast)
![](https://blog.tipranks.com/wp-content/uploads/2024/02/image-233-1024x519.png)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.