Should You Buy the Dip in Eli Lilly Stock Right Now?

Eli Lilly and Company (LLY) has been a strong performer in the pharmaceutical industry, but its stock price has recently dipped due to a combination of factors. The company's reduced fourth-quarter sales guidance and slower-than-anticipated obesity drug sales have contributed to the stock price decline. However, this dip presents an opportunity for investors to consider buying the stock, given Eli Lilly's robust pipeline, strong financial performance, and long-term growth prospects.



Eli Lilly's financial performance has been impressive in the past quarter. The company's revenue increased by 36% compared to Q2 2023, driven by a 27% increase in volume and a 10% increase due to higher realized prices. Excluding the sale of rights for Baqsimi in Q2 2023, revenue in Q2 2024 increased by 46%, and worldwide volume increased by 37%. Non-incretin revenue increased 17% worldwide and 25% in the U.S. Additionally, Eli Lilly's EPS increased 68% to $3.28 on a reported basis and increased 86% to $3.92 on a non-GAAP basis, both inclusive of $0.14 of acquired IPR&D charges.



Eli Lilly's pipeline progress has been a significant driver of its growth and future prospects. The company received approval for Kisunla in the U.S. for Alzheimer's disease and Jaypirca in Japan for relapsed or refractory mantle cell lymphoma. Additionally, Eli Lilly submitted tirzepatide in the U.S. and EU for obstructive sleep apnea and obesity, and reported positive topline results from the Phase 3 trial evaluating tirzepatide for heart failure with preserved ejection fraction and obesity.



Despite the recent dip, Eli Lilly's stock price has shown strong performance over the past year. The company's stock price is up about 37% over the past 12 months and 13% in January alone. This performance is a testament to Eli Lilly's strong financial performance and growth prospects.

In conclusion, while Eli Lilly's stock price has dipped recently due to reduced sales guidance and slower obesity drug sales, the company's robust pipeline, strong financial performance, and long-term growth prospects make it an attractive investment opportunity. Investors should consider buying the dip in Eli Lilly stock, as the company's fundamentals and growth prospects remain strong. However, it is essential to conduct thorough research and consider your risk tolerance before making any investment decisions.