ELI LILLY & CO (LLY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LLY - US5324571083 - Common Stock
1039.51 USD
-23.24 (-2.19%)
1042.9 USD
+3.39 (+0.33%)
Taking everything into account, LLY scores 7 out of 10 in our fundamental rating. LLY was compared to 190 industry peers in the Pharmaceuticals industry. LLY scores excellent on profitability, but there are some minor concerns on its financial health. LLY is not overvalued while it is showing excellent growth. This is an interesting combination. LLY also has an excellent dividend rating. These ratings would make LLY suitable for dividend and growth investing!
1. Profitability
1.1 Basic Checks
- In the past year LLY was profitable.
- LLY had a positive operating cash flow in the past year.
- LLY had positive earnings in each of the past 5 years.
- Each year in the past 5 years LLY had a positive operating cash flow.
1.2 Ratios
- LLY has a better Return On Assets (16.02%) than 95.79% of its industry peers.
- The Return On Equity of LLY (77.38%) is better than 99.47% of its industry peers.
- LLY has a Return On Invested Capital of 28.84%. This is amongst the best in the industry. LLY outperforms 97.89% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for LLY is significantly above the industry average of 12.83%.
- The 3 year average ROIC (21.71%) for LLY is below the current ROIC(28.84%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.02% | ||
| ROE | 77.38% | ||
| ROIC | 28.84% |
ROA(3y)11.42%
ROA(5y)11.8%
ROE(3y)60.64%
ROE(5y)70.77%
ROIC(3y)21.71%
ROIC(5y)19.96%
1.3 Margins
- LLY has a better Profit Margin (30.99%) than 94.74% of its industry peers.
- LLY's Profit Margin has declined in the last couple of years.
- LLY has a better Operating Margin (44.41%) than 98.42% of its industry peers.
- In the last couple of years the Operating Margin of LLY has grown nicely.
- The Gross Margin of LLY (83.03%) is better than 86.84% of its industry peers.
- LLY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.41% | ||
| PM (TTM) | 30.99% | ||
| GM | 83.03% |
OM growth 3Y12.38%
OM growth 5Y7.84%
PM growth 3Y6.05%
PM growth 5Y-8.8%
GM growth 3Y3.11%
GM growth 5Y0.62%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LLY is creating value.
- Compared to 1 year ago, LLY has about the same amount of shares outstanding.
- LLY has less shares outstanding than it did 5 years ago.
- LLY has a worse debt/assets ratio than last year.
2.2 Solvency
- LLY has an Altman-Z score of 8.39. This indicates that LLY is financially healthy and has little risk of bankruptcy at the moment.
- LLY's Altman-Z score of 8.39 is amongst the best of the industry. LLY outperforms 81.05% of its industry peers.
- LLY has a debt to FCF ratio of 6.60. This is a slightly negative value and a sign of low solvency as LLY would need 6.60 years to pay back of all of its debts.
- With an excellent Debt to FCF ratio value of 6.60, LLY belongs to the best of the industry, outperforming 80.53% of the companies in the same industry.
- LLY has a Debt/Equity ratio of 1.72. This is a high value indicating a heavy dependency on external financing.
- LLY's Debt to Equity ratio of 1.72 is on the low side compared to the rest of the industry. LLY is outperformed by 76.84% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.72 | ||
| Debt/FCF | 6.6 | ||
| Altman-Z | 8.39 |
ROIC/WACC3.11
WACC9.28%
2.3 Liquidity
- A Current Ratio of 1.55 indicates that LLY should not have too much problems paying its short term obligations.
- LLY has a Current ratio of 1.55. This is in the lower half of the industry: LLY underperforms 71.58% of its industry peers.
- A Quick Ratio of 1.24 indicates that LLY should not have too much problems paying its short term obligations.
- With a Quick ratio value of 1.24, LLY is not doing good in the industry: 72.11% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
- LLY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 116.22%, which is quite impressive.
- LLY shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.57% yearly.
- The Revenue has grown by 45.41% in the past year. This is a very strong growth!
- The Revenue has been growing by 15.08% on average over the past years. This is quite good.
EPS 1Y (TTM)116.22%
EPS 3Y16.75%
EPS 5Y16.57%
EPS Q2Q%494.92%
Revenue 1Y (TTM)45.41%
Revenue growth 3Y16.73%
Revenue growth 5Y15.08%
Sales Q2Q%53.87%
3.2 Future
- LLY is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 32.61% yearly.
- The Revenue is expected to grow by 19.64% on average over the next years. This is quite good.
EPS Next Y84.93%
EPS Next 2Y59.63%
EPS Next 3Y46.9%
EPS Next 5Y32.61%
Revenue Next Year41.38%
Revenue Next 2Y31.01%
Revenue Next 3Y26.06%
Revenue Next 5Y19.64%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- LLY is valuated quite expensively with a Price/Earnings ratio of 47.27.
- Compared to the rest of the industry, the Price/Earnings ratio of LLY indicates a somewhat cheap valuation: LLY is cheaper than 76.84% of the companies listed in the same industry.
- The average S&P500 Price/Earnings ratio is at 28.87. LLY is valued rather expensively when compared to this.
- With a Price/Forward Earnings ratio of 31.38, LLY can be considered very expensive at the moment.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of LLY indicates a somewhat cheap valuation: LLY is cheaper than 72.63% of the companies listed in the same industry.
- LLY is valuated rather expensively when we compare the Price/Forward Earnings ratio to 25.96, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 47.27 | ||
| Fwd PE | 31.38 |
4.2 Price Multiples
- 78.42% of the companies in the same industry are more expensive than LLY, based on the Enterprise Value to EBITDA ratio.
- LLY's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. LLY is cheaper than 74.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 152.68 | ||
| EV/EBITDA | 36.67 |
4.3 Compensation for Growth
- LLY's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- LLY has an outstanding profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as LLY's earnings are expected to grow with 46.90% in the coming years.
PEG (NY)0.56
PEG (5Y)2.85
EPS Next 2Y59.63%
EPS Next 3Y46.9%
5. Dividend
5.1 Amount
- LLY has a yearly dividend return of 0.64%, which is pretty low.
- LLY's Dividend Yield is rather good when compared to the industry average which is at 0.47. LLY pays more dividend than 88.95% of the companies in the same industry.
- With a Dividend Yield of 0.64, LLY pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
- On average, the dividend of LLY grows each year by 15.59%, which is quite nice.
- LLY has been paying a dividend for at least 10 years, so it has a reliable track record.
- LLY has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)15.59%
Div Incr Years10
Div Non Decr Years34
5.3 Sustainability
- LLY pays out 28.28% of its income as dividend. This is a sustainable payout ratio.
- The dividend of LLY is growing, but earnings are growing more, so the dividend growth is sustainable.
DP28.28%
EPS Next 2Y59.63%
EPS Next 3Y46.9%
ELI LILLY & CO / LLY FAQ
Can you provide the ChartMill fundamental rating for ELI LILLY & CO?
ChartMill assigns a fundamental rating of 7 / 10 to LLY.
What is the valuation status of ELI LILLY & CO (LLY) stock?
ChartMill assigns a valuation rating of 5 / 10 to ELI LILLY & CO (LLY). This can be considered as Fairly Valued.
What is the profitability of LLY stock?
ELI LILLY & CO (LLY) has a profitability rating of 9 / 10.
Can you provide the PE and PB ratios for LLY stock?
The Price/Earnings (PE) ratio for ELI LILLY & CO (LLY) is 47.27 and the Price/Book (PB) ratio is 41.3.
What is the earnings growth outlook for ELI LILLY & CO?
The Earnings per Share (EPS) of ELI LILLY & CO (LLY) is expected to grow by 84.93% in the next year.