BofA says they are buying the dip after the stock fell in the fourth quarter. Miss Investing.com
Investing.com– Shares of Eli Lily fell sharply on Tuesday after the pharmaceutical company reported weaker-than-expected fourth-quarter revenue, though BofA analysts said it was a buying opportunity.
Shares of Eli Lilly and Company (NYSE: ) slipped 6.6% to $744.91, after it said it expected revenue of $13.5 billion in the fourth quarter — weaker than the consensus expectation of $14.08 billion. The failure was mainly caused by weaker-than-expected sales of the drugs Mounjaro and Zepbound, which investors had somewhat expected.
BofA said the stock’s losses offered “an especially good buying opportunity,” noting that LLY remains one of two big companies that should continue to dominate a big market — weight loss drugs.
LLY forecasts 2025 sales of between $58 billion and $61 billion – the midpoint is slightly above market estimates of $58.52 billion.
BofA maintained LLY at Buy and a $997.0 price target, but said it was reviewing its valuations on the stock.
BofA noted that the fourth-quarter revenue decline was “still a miss.” The brokerage also flagged recent questions about lower-than-first-expected demand, particularly as LLY ramped up supply of its Mounjaro and Zepbound drugs in recent quarters.
While optimism about the weight-loss drug fueled LLY’s strong gains through early 2024, sales of those two drugs also missed expectations in the October quarter, keeping LLY’s stock range-bound until today.
Still, LLY is looking to expand its customer base for its leading weight loss drugs. The company plans to release Mounjaro in China, India, Brazil and Mexico in 2025.
The company, along with Copenhagen-listed Novo Nordisk A/S (NYSE: ), are the only two major makers of weight-loss drugs, a category that has grown in popularity over the past year, particularly with the launch of Novo Nordisk’s Ozempic.
