May 23, 2024
Top 10 Stock Eli Lilly Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Eli Lilly – Top 10 Stock in Dividend Champions United States
Eli Lilly is listed as a top 10 stock on May 23, 2024 in the market index Dividends USA because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is growing above average and professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 48 (48% performer), Obermatt assesses an overall hold recommendation for Eli Lilly on May 23, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Pharmaceuticals |
| Index | Dividends USA, Employee Focus US, Diversity USA, Moonshot Tech, D.J. US Pharmaceutical, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Eli Lilly Hold
| 360 METRICS | May 23, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 17 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 33 |
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| SENTIMENT | ||||||||
| SENTIMENT | 71 |
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| 360° VIEW | ||||||||
| 360° VIEW | 48 |
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ANALYSIS: With an Obermatt 360° View of 48 (better than 48% compared with alternatives), overall professional sentiment and financial characteristics for the stock Eli Lilly are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Eli Lilly. The consolidated Growth Rank has a good rank of 99, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is higher than for 99% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 71, which means that professional investors are more optimistic about the stock than for 71% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 17, which means that the share price of Eli Lilly is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 83% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 33, which means that the company has a financing structure that is riskier than those of 67% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 48, Eli Lilly is worse than 52% of all alternative stock investment opportunities based on the Obermatt Method. Only half of the consolidated Obermatt Ranks exhibit excellent performance, so one needs to take a close look. Growth is above-average (Growth Rank of 99), and professional market sentiment is positive (Sentiment Rank of 71), but value and safety are below average. The Safety Rank is the least significant of the four consolidated ranks, because it only reflects financing practices. In the case of high growth, aggressive financing is a good thing. So the question is: How to assess below-average value against above-average growth and sentiment? Growth may be the strongest driver of the investment rationale in this case, which is reflected in institutional investors' opinions. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much do you sacrifice value for growth? You can use the following rule of thumb: If you take 100 minus the growth rank, you arrive at a possibly minimum level for the value rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the growth rank is above 60. Sometimes market sentiment just extrapolates the past, but sometimes it reflects reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Eli Lilly positive
ANALYSIS: With an Obermatt Sentiment Rank of 71 (better than 71% compared with alternatives), overall professional sentiment and engagement for the stock Eli Lilly is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Eli Lilly. Analyst Opinions are at a rank of 51 (better than 51% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 97, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Eli Lilly. Finally, the Professional Investors rank is 66, which means that currently, professional investors hold more stock in this company than in 66% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 71 (more positive than 71% compared with investment alternatives), Eli Lilly has a reputation among professional investors that is above-average compared with that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 46, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 54% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Eli Lilly is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Eli Lilly Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 17 (worse than 83% compared with alternatives), Eli Lilly shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Eli Lilly. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 84% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 3 which means that the stock price compared with what market professionals expect for future profits is higher than 97% of comparable companies, indicating a low value concerning Eli Lilly's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 17 which means that the stock price compared with what market professionals expect for future profit levels is higher than 83% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 1 is also low. Compared with invested capital, the stock price is higher than for 99% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 17, is a sell recommendation based on Eli Lilly's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Eli Lilly? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Eli Lilly only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Eli Lilly Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 99 (better than 99% compared with alternatives) for 2024, Eli Lilly shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Eli Lilly. Sales Growth has a value of 86, which means that, currently, professionals expect the company to grow more than 86% of its competitors. The same is valid for Profit Growth with a value of 98 and for Capital Growth with 70. In addition, Stock Returns had an above-average rank value of 86, which means they have been higher than 86% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 99, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Eli Lilly exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Eli Lilly Debt Financing Safety below-average
| SAFETY METRICS | May 23, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 15 |
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| REFINANCING | ||||||||
| REFINANCING | 13 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 94 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 33 |
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ANALYSIS: With an Obermatt Safety Rank of 33 (better than 33% compared with alternatives), the company Eli Lilly has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Eli Lilly is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Eli Lilly. Liquidity is at 94, meaning the company generates more profit to service its debt than 94% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 13, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 87% of its competitors. Leverage is also high at a rank of 15, which means that the company has an above-average debt-to-equity ratio. It has more debt than 85% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 33 (worse than 67% compared with alternatives), Eli Lilly has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Eli Lilly Below-Average Financial Performance
| COMBINED PERFORMANCE | May 23, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 17 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 94 |
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| COMBINED | ||||||||
| COMBINED | 46 |
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ANALYSIS: With an Obermatt Combined Rank of 46 (worse than 54% compared with investment alternatives), Eli Lilly (Pharmaceuticals, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Eli Lilly are low in value (priced high) with a consolidated Value Rank of 17 (worse than 83% of alternatives), and are riskily financed (Safety Rank of 33, which means above-average debt burdens) but show above-average growth (Growth Rank of 99). ...read more
RECOMMENDATION: A Combined Rank of 46, is a hold recommendation based on Eli Lilly's financial characteristics. As the company Eli Lilly shows low value with an Obermatt Value Rank of 17 (83% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 99% of comparable companies (Obermatt Growth Rank is 99). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 33 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Eli Lilly, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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