Eli Lilly (LLY)
Health Care · $1.33T market cap · SEC CIK 0000059478
ahead of 99% of the S&P 500 · #1 of 59 in Health Care
Next reports on Feb 2, 2027, before the open, with analysts expecting $11.29 in earnings per share.
52-week range $850.51 to $1,453. 1% below its 52-week high and 68% above its low.
The case for LLY
- Revenue up 45.5% on the year.
- Earns 84% on shareholder equity.
- 32% of revenue drops through to net profit.
- Earnings per share up 50.6%.
- Has compounded revenue at 21.6% a year over five years.
- Gross margin of 84% absorbs cost shocks.
The case against
- Priced at 27× book value. Very little hard asset backing here.
- Long-term debt of $40.9B against $7.3B of cash.
- Price/sales of 15.4× is higher than 98% of Health Care companies.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Health Care companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 59 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 92 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 88 |
| Momentumhow the price has behaved lately | 87 |
| Stabilityhow violently it moves, what it owes and what it pays you | 74 |
- Capital spending is missing from its filings, so free cash flow cannot be worked out. Operating cash flow stands in for the cash test, against a stricter bar.
- Each factor except momentum is half fixed thresholds, half rank among the 59 Health Care companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +45.5% |
|---|---|
| Over 5 years | +21.6% a year |
| FY2025 revenue | $65.2B (+45%) |
Free cash flow
Is it generating real cash? Can't tell: no capital spending in its filings
| FY2025 operating cash flow | $16.8B |
|---|---|
| Of profit, before capital spending | 81% |
Its filings do not give capital spending, so free cash flow cannot be worked out. Operating cash flow, which is before that spending, is shown instead, and the score judges it against a stricter bar.
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 84% |
|---|---|
| Operating margin | 40% |
| Net margin, FY24 → FY25 → now | 23.5% → 31.7% → 31.9% |
Debt vs. cash
Is the balance sheet healthy? Yes, the debt is manageable
| Cash | $7.3B |
|---|---|
| Long-term debt | $40.9B |
| Net debt | $33.6B |
| Years to repay | 2.4 yrs |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 48.2× |
|---|---|
| Fair P/E for its growth | 46× |
| P/FCF | n/a |
| Forward P/E | 30.6× |
| EV / EBITDA | 37.1× |
At 48.2× earnings it trades close to the 46× that 25%+ a year of growth would justify.
The financials, five years deep
Pulled from Eli Lilly's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $65.2B | $45.0B | $34.1B | $28.5B | $28.3B |
| Change on the year | +45% | +32% | +20% | +1% | — |
| Profit margins | |||||
| Net margin | 31.7% | 23.5% | 15.4% | 21.9% | 19.7% |
| Debt vs. cash | |||||
| Cash | $7.3B | $3.3B | $2.8B | $2.1B | $3.8B |
| Long-term debt | $40.9B | $28.5B | $18.3B | $14.7B | $15.3B |
| Net cash (debt) | −$33.6B | −$25.3B | −$15.5B | −$12.7B | −$11.5B |
What Eli Lilly says it does
Eli Lilly and Company (referred to as the company, Lilly, we, or us) was incorporated in 1901 in Indiana to succeed to the drug manufacturing business founded in Indianapolis, Indiana, in 1876 by Colonel Eli Lilly. We discover, develop, manufacture, and market products in a single business segment—human pharmaceutical products. Our purpose is to unite caring with discovery to create medicines that make life better for people around the world. Our long-term success depends on our ability to continually discover or acquire, develop, and commercialize innovative medicines. We manufacture and distribute our products through facilities in the United States (U.S.), including Puerto Rico, and in Europe and Asia. Our products are sold in approximately 90 countries. Products Our products include: Therapeutic area Products Certain Indications Cardiometabolic Health products Basaglar In collaboration with Boehringer Ingelheim, a long-acting human…
Risk factors LLY lists in its 10-K
- We and our products face intense competition, and such competition could have a material adverse effect on our business
- Pharmaceutical products can develop safety or efficacy concerns, which could have a material adverse effect on our revenues, income, and reputation
- We derive a significant percentage of our total revenue from relatively few products and sell our products through consolidated supply chain entities, which subjects us to various risks
- Our long-term success depends on intellectual property protection; if our intellectual property rights are invalidated, circumvented, or weakened, our business will be adversely affected
- Manufacturing, quality, or supply chain difficulties, disruptions, or shortages could lead to product supply problems or other negative outcomes
- Reliance on third-party relationships and outsourcing arrangements could adversely affect our business
- Our use of artificial intelligence (AI) or other emerging technologies could adversely impact us
- Our global operations subject us to risks, including as related to uneven economic growth or downturns, international trade, and other global disruptions, geopolitical tensions, or disputes
- We are party to litigation and investigations, which could adversely affect our business
- We are subject to evolving and complex tax laws, which may result in additional liabilities
- Regulatory compliance problems could be damaging to the company