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A Pricing Powerhouse, Now 30% Cheaper: Is Eli Lilly Stock A Buy?
Forbesยท 2025-10-09 14:15
Core Insights - Eli Lilly (LLY) stock is highlighted for its monopoly-like high margins and reduced pricing, making it an attractive investment opportunity [2] - The company has demonstrated strong revenue growth and profitability, with a focus on innovative pharmaceuticals for various conditions [3][6] Financial Performance - Revenue growth for Eli Lilly was 36.8% over the last twelve months (LTM) and averaged 23.4% over the past three years [6] - Recent profitability metrics include an operating cash flow margin of approximately 20.5% and an operating margin of 43.0% LTM [6] - Long-term profitability averages show an operating cash flow margin of roughly 17.8% and an operating margin of 35.6% over the last three years [6] Valuation - Eli Lilly stock is currently available at a price-to-sales (P/S) multiple of 14.3, representing a 30% discount compared to one year ago [6] Market Trends - The stock selection strategy focuses on companies with a market cap greater than $10 billion, eliminating those with low cash flow from operations and operating margins, while also considering stocks that have significantly decreased in valuation over the past year [5] - The average 12-month forward returns for selected stocks are nearly 19%, with a win rate of around 72% for positive returns [7]