Ready to Jump After Recent Trade: Eli Lilly and Company (LLY)

Eli Lilly and Company (NYSE: LLY) stock jumped 4.85% on Friday to $310.87 against a previous-day closing price of $296.48. With 5.88 million shares changed hands, the volume of the stock remained heavier than its average volume of 2.56 million shares. During the session, the Drug Manufacturers – General company that operates in wider Healthcare sector, reached to the highest price of $312.61 whereas the lowest price it dropped to was $299.96. The 52-week range on LLY shows that it touched its highest point at $335.33 and its lowest point at $220.20 during that stretch. It currently has a 1-year price target of $344.66. With its current market cap of 295.94 billion, LLY has annualized dividend of $3.92 while the current yield stands at 1.26%. Beta for the stock currently stands at 0.37.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of LLY was up-trending over the past week, with a rise of 0.45%, but this was down by -1.34% over a month. Three-month performance dropped to -0.59% while six-month performance rose 9.39%. The stock gained 36.17% in the past year, while it has gained 12.54% so far this year. A look at the trailing 12-month EPS for LLY yields 6.27 with Next year EPS estimates of 9.46. For the next quarter, that number is 1.93. This implies an EPS growth rate of -9.80% for this year and 18.10% for next year. EPS is expected to grow by 17.54% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 18.90%.

Float and Shares Shorts:

At present, 950.17 million LLY shares are outstanding with a float of 947.67 million shares on hand for trading. On Jul 14, 2022, short shares totaled 5.46 million, which was 0.58% higher than short shares on Jun 14, 2022. In addition to Mr. David A. Ricks as the firm’s Chairman, CEO & Pres, Ms. Anat Ashkenazi serves as its Sr. VP & CFO.

Institutional Ownership:

Through their ownership of 84.06% of LLY’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 40.92% of LLY, in contrast to 32.58% held by mutual funds. Shares owned by individuals account for 11.73%. As the largest shareholder in LLY with 7.19% of the stake, The Vanguard Group, Inc. holds 68,285,679 shares worth 68,285,679. A second-largest stockholder of LLY, PNC Bank, NA, holds 52,076,354 shares, controlling over 5.48% of the firm’s shares. BlackRock Fund Advisors is the third largest shareholder in LLY, holding 40,194,843 shares or 4.23% stake. With a 2.67% stake in LLY, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 25,321,026 shares are owned by the mutual fund manager. The Vanguard 500 Index Fund, which owns about 1.85% of LLY stock, is the second-largest Mutual Fund holder. It holds 17,600,203 shares valued at 5.3 billion. Vanguard PRIMECAP Fund holds 1.68% of the stake in LLY, owning 15,994,758 shares worth 4.82 billion.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for LLY since 22 analysts follow the stock currently. There are 13 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 6 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 1 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With LLY analysts setting a high price target of $412.00 and a low target of $202.00, the average target price over the next 12 months is $341.10. Based on these targets, LLY could surge 32.53% to reach the target high and fall by -35.02% to reach the target low. Reaching the average price target will result in a growth of 9.72% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. LLY will report FY 2022 earnings on 02/02/2023. Analysts have provided yearly estimates in a range of $8.49 being high and $7.65 being low. For LLY, this leads to a yearly average estimate of $8.01. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Eli Lilly and Company surprised analysts by -$0.45 when it reported $1.25 EPS against a consensus estimate of $1.70. The surprise factor in the prior quarter was $0.33. Based on analyst estimates, the high estimate for the next quarter is $2.20 and the low estimate is $1.47. The average estimate for the next quarter is thus $1.92.

Summary of Insider Activity:

Insiders traded LLY stock several times over the past three months with 13 Buys and 24 Sells. In these transactions, 1,066 shares were bought while 749,555 shares were sold. The number of buy transactions has increased to 89 while that of sell transactions has risen to 154 over the past year. The total number of shares bought during that period was 282,003 while 4,442,784 shares were sold.

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