BMO Capital raises target on Eli Lilly stock as recent profit misses expectations

BMO Capital Markets revised its outlook for Eli Lilly and Company (NYSE: ) on Tuesday, raising its price target on the stock to $1,001 from $900 previously, while maintaining an Outperform rating. The revision comes after Eli Lilly announced a $2 billion increase to its full-year 2024 guidance, which is now estimated to be between $42.4 billion and $43.6 billion.

Analysts at BMO Capital stressed that Eli Lilly's recent earnings decline should be viewed positively as it reflects strong demand that has outstripped the company's current supply capabilities. The company noted that Eli Lilly is actively working to address these supply constraints, which are expected to further drive growth and strengthen the company's competitive position in the market.

Eli Lilly's leadership in treating type 2 diabetes (T2D) and obesity was highlighted, with current limitations attributed more to manufacturing capacity than a lack of demand. The company's potential to improve U.S. supply through alternative acquisition methods is also cited as a factor that could help future stock performance.

BMO Capital mentioned that Eli Lilly's profit margin improvement prospects are promising due to various factors such as strategic pricing and delayed approval of donanemab, mirikizumab and lebrikizumab. These factors are seen as key drivers of the company's continued success and contribute to the decision to increase the target price.

Analyst comments reflect confidence in Eli Lilly's strategic efforts and the expected positive impact on the company's financial performance. The improved guidance and potential to overcome current challenges suggest that BMO Capital Markets thinks Eli Lilly's stock has a good outlook.

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Investment Professional Insights

As Eli Lilly and Company (NYSE: LLY ) turns heads with its revised full-year guidance and raised price target from BMO Capital Markets, Insights from InvestingPro provides investors with more context. The company's market capitalization is an impressive $704.77 billion, underscoring its important position in the pharmaceutical industry.

Despite a high price-to-earnings ratio of 133.45, reflecting market optimism about future earnings growth, Eli Lilly has shown strong financial health, with revenue growing strongly at 19.56% in the past 12 months through the first quarter of 2023. further support for gross profit margin.

InvestingPro Tips emphasizes that Eli Lilly has raised its dividend for nine consecutive years, with a significant dividend growth of 15.04% in the past 12 months as of the first quarter of 2023, and has maintained dividend payments for 54 consecutive years.

This consistent shareholder return is complemented by a strong record of profitability, with a return on assets of 9.23%. Additionally, the stock has experienced significant gains over the past six months with a total return of 33.57% and a whopping 87.79% total return last year, reflecting strong investor confidence.

For investors seeking a deeper understanding of Eli Lilly and Company's financial and market performance, InvestingPro provides further analysis and tips. There are 19 additional tips on InvestingPro to get a complete picture of a company's position and prospects.Interested investors can use coupon codes to enjoy special offers PRONEWS24 Subscribe to Pro and Pro+ annually or every two years to receive an additional 10% discount and enrich their investment strategies with valuable insights.

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