In today's fast-paced and competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies before making investment decisions. In this article, we will conduct a comprehensive industry comparison, evaluating Eli Lilly LLY against its key competitors in the Pharmaceuticals industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.
Eli Lilly Background
Eli Lilly is a drug firm with a focus on neuroscience, cardiometabolic, cancer, and immunology. Lilly's key products include Verzenio for cancer; Mounjaro, Zepbound, Jardiance, Trulicity, Humalog, and Humulin for cardiometabolic; and Taltz and Olumiant for immunology.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Eli Lilly and Co | 112.69 | 60.75 | 21.25 | 22.5% | $4.12 | $9.13 | 35.98% |
| Novo Nordisk AS | 45.06 | 35.80 | 15.70 | 18.97% | $35.74 | $57.79 | 25.34% |
| Johnson & Johnson | 24.93 | 5.55 | 4.68 | 6.62% | $7.8 | $15.58 | 4.31% |
| Merck & Co Inc | 21.71 | 6.82 | 4.78 | 13.0% | $7.45 | $12.37 | 7.16% |
| AstraZeneca PLC | 38.30 | 6.19 | 5.02 | 5.01% | $4.12 | $10.76 | 13.33% |
| Novartis AG | 23.72 | 5.63 | 4.90 | 7.97% | $5.25 | $9.7 | 9.6% |
| Sanofi SA | 31.18 | 1.81 | 2.78 | 1.53% | $2.03 | $7.97 | 6.53% |
| Zoetis Inc | 37.89 | 17.63 | 9.95 | 12.45% | $0.97 | $1.69 | 8.3% |
| GSK PLC | 14.01 | 4.49 | 1.82 | 8.32% | $2.31 | $5.76 | 9.84% |
| Takeda Pharmaceutical Co Ltd | 45.13 | 0.86 | 1.52 | 1.26% | $388.51 | $821.04 | 14.11% |
| Dr Reddy's Laboratories Ltd | 19.69 | 3.71 | 3.79 | 4.84% | $21.72 | $46.34 | 13.87% |
| Jazz Pharmaceuticals PLC | 18.85 | 1.83 | 1.99 | 4.52% | $0.36 | $0.91 | 6.95% |
| Organon & Co | 5.20 | 36.08 | 0.82 | 203.12% | $0.43 | $0.94 | -0.06% |
| Corcept Therapeutics Inc | 36.21 | 7.17 | 7.96 | 6.14% | $0.04 | $0.16 | 39.15% |
| Prestige Consumer Healthcare Inc | 18.07 | 2.18 | 3.33 | 2.94% | $0.08 | $0.15 | -4.36% |
| Average | 27.14 | 9.7 | 4.93 | 21.19% | $34.06 | $70.8 | 11.0% |
Through a thorough examination of Eli Lilly, we can discern the following trends:
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The Price to Earnings ratio of 112.69 for this company is 4.15x above the industry average, indicating a premium valuation associated with the stock.
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With a Price to Book ratio of 60.75, which is 6.26x the industry average, Eli Lilly might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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The stock's relatively high Price to Sales ratio of 21.25, surpassing the industry average by 4.31x, may indicate an aspect of overvaluation in terms of sales performance.
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With a Return on Equity (ROE) of 22.5% that is 1.31% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $4.12 Billion is 0.12x below the industry average, suggesting potential lower profitability or financial challenges.
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The gross profit of $9.13 Billion is 0.13x below that of its industry, suggesting potential lower revenue after accounting for production costs.
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The company's revenue growth of 35.98% is notably higher compared to the industry average of 11.0%, showcasing exceptional sales performance and strong demand for its products or services.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
When comparing Eli Lilly with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:
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Compared to its top 4 peers, Eli Lilly has a moderate debt-to-equity ratio of 2.13, indicating a balanced financial structure.
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This suggests that the company maintains a reasonable level of debt while also leveraging equity financing.
Key Takeaways
For Eli Lilly, the PE, PB, and PS ratios are all high compared to its peers in the Pharmaceuticals industry, indicating potentially overvalued stock. On the other hand, Eli Lilly's high ROE and revenue growth suggest strong performance relative to industry standards. However, the low EBITDA and gross profit levels may raise concerns about the company's operational efficiency and profitability compared to its competitors in the sector.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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