Eli Lilly and Company (LLY): What is the Risk Factor?

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Eli Lilly and Company (NYSE:LLY) saw an upside of 1.22% to close Tuesday at $346.39 after adding $4.18 on the day. The 5-day average trading volume is 3,199,560 shares of the company’s common stock. It has gained $384.44 in the past week and touched a new high 2 times within the past 5 days. An average of 2,204,420 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 2,728,338.

LLY’s 1-month performance is -5.87% or -$21.51 on its low of $302.14 reached on 01/24/23. The company’s shares have touched a 52-week low of $231.87 and high of $375.25, with the stock’s rally to the 52-week high happening on 01/24/23. YTD, LLY has lost -5.32% or -$19.45 and has reached a new high 2 times. However, the current price is down -7.69% from the 52-week high price.

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Insider Transactions

LLY stock investors last saw insider trading activity on Dec 02.LILLY ENDOWMENT INC (10% Owner) most recently sold 49,089 shares at $372.88 per share on Dec 02. This transaction cost the insider $18,304,192. 10% Owner, LILLY ENDOWMENT INC, sold 160,911 shares at a price of $371.54 on Dec 01. Then, on Nov 07, 10% Owner LILLY ENDOWMENT INC sold 63,585 shares at a price of $363.94 per share. This transaction amounted to $23,141,044.

Valuation Metrics

LLY stock has a beta of 0.38. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 11.42 while the price-to-book (PB) in the most recent quarter is 30.98, with the price to cash flow ratio at 128.84.

Eli Lilly and Company’s quick ratio for the period ended June 29 was 0.90, with the current ratio over the same period at 1.10. As well, the company’s long term debt to equity for the quarter ending June 29 was 1.40, while the total debt to equity was 1.58.. In terms of profitability, the gross margin trailing 12 months is 75.60%. The firm’s gross profit as reported stood at $21.01 billion against revenue of $28.32 billion.

Earnings Surprise

For the quarterly period ending June 29 this year, Eli Lilly and Company’s cash and short-term investments amounted to $124.7 million against total debt of $16.9 billion. Net income and sales went up compared to those figures reported in the previous quarter. Net income grew 23.53% to $1.45 billion, while revenue of $952.5 million was 34.39% off the previous quarter. Analysts expected LLY to announce $1.78 per share in earnings in its latest quarter, but it posted $1.29, representing a -27.50% surprise. EBITDA for the quarter stood at more than $2.04 billion. LLY stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 37.3 billion, with total debt at $16.9 billion. Shareholders hold equity totaling $950.18 million.

Let’s look briefly at Eli Lilly and Company (LLY) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 24 January was 36.82% to suggest the stock is trending Neutral, with historical volatility in this time period at 19.37%.

The stock’s 5-day moving average is $347.55, reflecting a -3.17% or -$11.35 change from its current price. LLY is currently trading -5.18% above its 20-day SMA, +12.82% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 by -4.65% and SMA200 by+13.26%.

Stochastic %K and %D was 25.69% and 22.69% and the average true range (ATR) pointed at 15.95. The RSI (14) points at 39.66%, while the 14-day stochastic is at 53.77% with the period’s ATR at 13.14. The stock’s 9-day MACD Oscillator is pointing at -8.07 and -9.69 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Eli Lilly and Company (NYSE: LLY), Credit Suisse launched coverage with an Outperform rating. Analysts offering their rating for LLY stock have a consensus rating for the stock as Overweight. Currently, 0 brokerage advisors rate LLY as a “sell,”, while 7 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 2 rates the stock as overweight while 14 have offered a “buy” rating.

What is LLY’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $202.00 and a high of $440.00, with their median price target at $400.00. Looking at these predictions, the average price target given by analysts is for Eli Lilly and Company (LLY) stock is $390.26.

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