ELI LILLY & CO (LLY) Stock Fundamental Analysis
NYSE:LLY - New York Stock Exchange, Inc. - US5324571083 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to LLY. LLY was compared to 198 industry peers in the Pharmaceuticals industry. While LLY has a great profitability rating, there are some minor concerns on its financial health. LLY is not priced too expensively while it is growing strongly. Keep and eye on this one!
1. Profitability
1.1 Basic Checks
In the past year LLY was profitable.
LLY had a positive operating cash flow in the past year.
Each year in the past 5 years LLY has been profitable.
In the past 5 years LLY always reported a positive cash flow from operatings.
1.2 Ratios
LLY has a better Return On Assets (13.45%) than 95.45% of its industry peers.
LLY has a Return On Equity of 74.62%. This is amongst the best in the industry. LLY outperforms 98.99% of its industry peers.
LLY has a better Return On Invested Capital (27.67%) than 96.97% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LLY is significantly below the industry average of 41.61%.
The 3 year average ROIC (21.71%) for LLY is below the current ROIC(27.67%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.45% | ||
| ROE | 74.62% | ||
| ROIC | 27.67% |
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 23.51%, LLY belongs to the best of the industry, outperforming 95.45% of the companies in the same industry.
LLY's Profit Margin has declined in the last couple of years.
LLY has a Operating Margin of 37.83%. This is amongst the best in the industry. LLY outperforms 96.46% of its industry peers.
LLY's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 81.31%, LLY belongs to the best of the industry, outperforming 85.86% of the companies in the same industry.
LLY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 37.83% | ||
| PM (TTM) | 23.51% | ||
| GM | 81.31% |
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.
The number of shares outstanding for LLY remains at a similar level compared to 1 year ago.
Compared to 5 years ago, LLY has less shares outstanding
LLY has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 9.40 indicates that LLY is not in any danger for bankruptcy at the moment.
LLY has a better Altman-Z score (9.40) than 88.89% of its industry peers.
The Debt to FCF ratio of LLY is 81.21, which is on the high side as it means it would take LLY, 81.21 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of LLY (81.21) is better than 75.25% of its industry peers.
A Debt/Equity ratio of 2.01 is on the high side and indicates that LLY has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 2.01, LLY is doing worse than 74.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | 81.21 | ||
| Altman-Z | 9.4 |
ROIC/WACC2.95
WACC9.38%
2.3 Liquidity
A Current Ratio of 1.15 indicates that LLY should not have too much problems paying its short term obligations.
LLY has a worse Current ratio (1.15) than 79.80% of its industry peers.
LLY has a Quick Ratio of 1.15. This is a bad value and indicates that LLY is not financially healthy enough and could expect problems in meeting its short term obligations.
LLY has a worse Quick ratio (0.89) than 79.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.15 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
LLY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 105.70%, 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 32.00% in the past year. This is a very strong growth!
Measured over the past years, LLY shows a quite strong growth in Revenue. The Revenue has been growing by 15.08% on average per year.
EPS 1Y (TTM)105.7%
EPS 3Y16.75%
EPS 5Y16.57%
EPS Q2Q%113.65%
Revenue 1Y (TTM)32%
Revenue growth 3Y16.73%
Revenue growth 5Y15.08%
Sales Q2Q%44.68%
3.2 Future
The Earnings Per Share is expected to grow by 30.37% on average over the next years. This is a very strong growth
LLY is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 17.76% yearly.
EPS Next Y78.29%
EPS Next 2Y51.71%
EPS Next 3Y41.96%
EPS Next 5Y30.37%
Revenue Next Year32.02%
Revenue Next 2Y25.54%
Revenue Next 3Y22.57%
Revenue Next 5Y17.76%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 69.15, the valuation of LLY can be described as expensive.
LLY's Price/Earnings ratio is a bit cheaper when compared to the industry. LLY is cheaper than 79.29% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.88. LLY is valued rather expensively when compared to this.
A Price/Forward Earnings ratio of 38.79 indicates a quite expensive valuation of LLY.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LLY indicates a somewhat cheap valuation: LLY is cheaper than 79.29% of the companies listed in the same industry.
LLY's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 21.20.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.15 | ||
| Fwd PE | 38.79 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LLY is valued a bit cheaper than 76.26% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, LLY is valued a bit cheaper than 75.76% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2056.95 | ||
| EV/EBITDA | 46.22 |
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.
The excellent profitability rating of LLY may justify a higher PE ratio.
LLY's earnings are expected to grow with 41.96% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.88
PEG (5Y)4.17
EPS Next 2Y51.71%
EPS Next 3Y41.96%
5. Dividend
5.1 Amount
LLY has a yearly dividend return of 0.70%, which is pretty low.
LLY's Dividend Yield is rather good when compared to the industry average which is at 4.58. LLY pays more dividend than 89.90% of the companies in the same industry.
With a Dividend Yield of 0.70, LLY pays less dividend than the S&P500 average, which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
5.2 History
On average, the dividend of LLY grows each year by 15.60%, which is quite nice.
LLY has paid a dividend for at least 10 years, which is a reliable track record.
LLY has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)15.6%
Div Incr Years10
Div Non Decr Years34
5.3 Sustainability
LLY pays out 44.20% of its income as dividend. This is a bit on the high side, but may be sustainable.
LLY's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP44.2%
EPS Next 2Y51.71%
EPS Next 3Y41.96%
898.95
+13.75 (+1.55%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners83.27%
Inst Owner Change1.96%
Ins Owners0.16%
Ins Owner Change-0.72%
Market Cap852.20B
Analysts82.5
Price Target1036.37 (15.29%)
Short Float %0.68%
Short Ratio1.72
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
Yearly Dividend4.93
Dividend Growth(5Y)15.6%
DP44.2%
Div Incr Years10
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-6.94%
Min EPS beat(2)-20.34%
Max EPS beat(2)6.45%
EPS beat(4)3
Avg EPS beat(4)9.86%
Min EPS beat(4)-20.34%
Max EPS beat(4)49.43%
EPS beat(8)6
Avg EPS beat(8)27.82%
EPS beat(12)9
Avg EPS beat(12)19.37%
EPS beat(16)10
Avg EPS beat(16)13.42%
Revenue beat(2)0
Avg Revenue beat(2)-3.85%
Min Revenue beat(2)-6.46%
Max Revenue beat(2)-1.24%
Revenue beat(4)1
Avg Revenue beat(4)0.6%
Min Revenue beat(4)-6.46%
Max Revenue beat(4)12.82%
Revenue beat(8)5
Avg Revenue beat(8)2.51%
Revenue beat(12)6
Avg Revenue beat(12)1.42%
Revenue beat(16)9
Avg Revenue beat(16)1.11%
PT rev (1m)2.03%
PT rev (3m)2.5%
EPS NQ rev (1m)-14.21%
EPS NQ rev (3m)-18.33%
EPS NY rev (1m)-0.97%
EPS NY rev (3m)1.94%
Revenue NQ rev (1m)-0.12%
Revenue NQ rev (3m)-5.13%
Revenue NY rev (1m)0.43%
Revenue NY rev (3m)1.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 69.15 | ||
| Fwd PE | 38.79 | ||
| P/S | 18.92 | ||
| P/FCF | 2056.95 | ||
| P/OCF | 96.64 | ||
| P/B | 60.05 | ||
| P/tB | 377.83 | ||
| EV/EBITDA | 46.22 |
EPS(TTM)13
EY1.45%
EPS(NY)23.18
Fwd EY2.58%
FCF(TTM)0.44
FCFY0.05%
OCF(TTM)9.3
OCFY1.03%
SpS47.51
BVpS14.97
TBVpS2.38
PEG (NY)0.88
PEG (5Y)4.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.45% | ||
| ROE | 74.62% | ||
| ROCE | 33.85% | ||
| ROIC | 27.67% | ||
| ROICexc | 29.69% | ||
| ROICexgc | 39.82% | ||
| OM | 37.83% | ||
| PM (TTM) | 23.51% | ||
| GM | 81.31% | ||
| FCFM | 0.92% |
ROA(3y)11.42%
ROA(5y)11.8%
ROE(3y)60.64%
ROE(5y)70.77%
ROIC(3y)21.71%
ROIC(5y)19.96%
ROICexc(3y)23.23%
ROICexc(5y)21.74%
ROICexgc(3y)32.89%
ROICexgc(5y)32.31%
ROCE(3y)29.19%
ROCE(5y)26%
ROICexcg growth 3Y1.59%
ROICexcg growth 5Y4.02%
ROICexc growth 3Y9.55%
ROICexc growth 5Y8.81%
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%
F-Score7
Asset Turnover0.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | 81.21 | ||
| Debt/EBITDA | 1.52 | ||
| Cap/Depr | 475.69% | ||
| Cap/Sales | 18.66% | ||
| Interest Coverage | 29.51 | ||
| Cash Conversion | 46.89% | ||
| Profit Quality | 3.91% | ||
| Current Ratio | 1.15 | ||
| Quick Ratio | 0.89 | ||
| Altman-Z | 9.4 |
F-Score7
WACC9.38%
ROIC/WACC2.95
Cap/Depr(3y)374.28%
Cap/Depr(5y)279.43%
Cap/Sales(3y)16.34%
Cap/Sales(5y)12.78%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)105.7%
EPS 3Y16.75%
EPS 5Y16.57%
EPS Q2Q%113.65%
EPS Next Y78.29%
EPS Next 2Y51.71%
EPS Next 3Y41.96%
EPS Next 5Y30.37%
Revenue 1Y (TTM)32%
Revenue growth 3Y16.73%
Revenue growth 5Y15.08%
Sales Q2Q%44.68%
Revenue Next Year32.02%
Revenue Next 2Y25.54%
Revenue Next 3Y22.57%
Revenue Next 5Y17.76%
EBIT growth 1Y65.03%
EBIT growth 3Y31.18%
EBIT growth 5Y24.1%
EBIT Next Year96.28%
EBIT Next 3Y44.1%
EBIT Next 5Y29.16%
FCF growth 1Y113.14%
FCF growth 3Y-57.48%
FCF growth 5Y-34.68%
OCF growth 1Y107.96%
OCF growth 3Y6.69%
OCF growth 5Y12.76%