ELI LILLY & CO (LLY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LLY - US5324571083 - Common Stock
1064.29 USD
-23.09 (-2.12%)
1065 USD
+0.71 (+0.07%)
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. While LLY belongs to the best of the industry regarding profitability, 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. With these ratings, LLY could be worth investigating further 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.
- LLY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- LLY's Return On Assets of 16.02% is amongst the best of the industry. LLY outperforms 95.81% of its industry peers.
- LLY has a better Return On Equity (77.38%) than 99.48% of its industry peers.
- LLY's Return On Invested Capital of 28.84% is amongst the best of the industry. LLY outperforms 97.91% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for LLY is significantly above the industry average of 12.83%.
- The last Return On Invested Capital (28.84%) for LLY is above the 3 year average (21.71%), which is a sign of increasing profitability.
| 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
- With an excellent Profit Margin value of 30.99%, LLY belongs to the best of the industry, outperforming 94.76% of the companies in the same industry.
- In the last couple of years the Profit Margin of LLY has declined.
- LLY's Operating Margin of 44.41% is amongst the best of the industry. LLY outperforms 98.43% of its industry peers.
- LLY's Operating Margin has improved in the last couple of years.
- LLY has a Gross Margin of 83.03%. This is amongst the best in the industry. LLY outperforms 86.91% 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
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so LLY is creating value.
- LLY has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, LLY has less shares outstanding
- The debt/assets ratio for LLY is higher compared to a year ago.
2.2 Solvency
- LLY has an Altman-Z score of 8.40. This indicates that LLY is financially healthy and has little risk of bankruptcy at the moment.
- LLY has a better Altman-Z score (8.40) than 80.63% 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.
- Looking at the Debt to FCF ratio, with a value of 6.60, LLY belongs to the top of the industry, outperforming 80.63% of the companies in the same industry.
- A Debt/Equity ratio of 1.72 is on the high side and indicates that LLY has dependencies on debt 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 76.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.72 | ||
| Debt/FCF | 6.6 | ||
| Altman-Z | 8.4 |
ROIC/WACC3.11
WACC9.27%
2.3 Liquidity
- LLY has a Current Ratio of 1.55. This is a normal value and indicates that LLY is financially healthy and should not expect problems in meeting its short term obligations.
- The Current ratio of LLY (1.55) is worse than 71.73% of its industry peers.
- A Quick Ratio of 1.24 indicates that LLY should not have too much problems paying its short term obligations.
- LLY's Quick ratio of 1.24 is on the low side compared to the rest of the industry. LLY is outperformed by 72.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 116.22% over the past year.
- 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
- Based on estimates for the next years, LLY will show a very strong growth in Earnings Per Share. The EPS will grow by 32.61% on average per year.
- LLY is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 19.64% yearly.
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.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 48.40, the valuation of LLY can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of LLY indicates a somewhat cheap valuation: LLY is cheaper than 76.96% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, LLY is valued quite expensively.
- LLY is valuated quite expensively with a Price/Forward Earnings ratio of 32.13.
- 72.77% of the companies in the same industry are more expensive than LLY, based on the Price/Forward Earnings ratio.
- LLY's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.4 | ||
| Fwd PE | 32.13 |
4.2 Price Multiples
- LLY's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LLY is cheaper than 78.53% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, LLY is valued a bit cheaper than 74.35% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 156.32 | ||
| EV/EBITDA | 36.72 |
4.3 Compensation for Growth
- The 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.
- LLY's earnings are expected to grow with 46.90% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.57
PEG (5Y)2.92
EPS Next 2Y59.63%
EPS Next 3Y46.9%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.64%, LLY is not a good candidate for dividend investing.
- LLY's Dividend Yield is rather good when compared to the industry average which is at 0.46. LLY pays more dividend than 89.53% 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 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
- The dividend of LLY is nicely growing with an annual growth rate of 15.59%!
- LLY has been paying a dividend for at least 10 years, so it has a reliable track record.
- LLY has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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.
- LLY's earnings are growing more than its dividend. This makes the dividend growth 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 48.4 and the Price/Book (PB) ratio is 42.29.
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.