CA - Eli Lilly and Company: Even 'Miracle Drugs' Can't Keep Stock Rising (Downgrade)

2024-02-07 18:00:06 ET

Summary

• Eli Lilly and Company has seen significant growth and generated strong returns, outperforming the S&P 500.
• The company's revenue increased by 28.1% in the final quarter of 2023, exceeding analysts' expectations.
• While some drugs, like Trulicity, have declined, others, such as Mounjaro and Verzenio, have shown promising growth.
• That growth should continue in the near term, but Eli Lilly and Company shares are getting expensive and warrant a downgrade.

Although I do not fancy myself a growth investor, opting instead to focus on the value approach to investing, I cannot deny that there is something alluring about buying rapidly growing firms that go on to achieve robust returns. One company that I uncharacteristically became bullish on late last year was pharmaceutical giant Eli Lilly and Company ( LLY ). The progress that the enterprise had made in the obesity market, first with the success of its Mounjaro brand and later with its launch of the same drug branded as Zepbound but marketed for obesity as opposed to those suffering from diabetes, made me excited about what kind of growth the company could achieve moving forward....

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