By Senad Karaahmetovic and Sam Boughedda
Shares of Eli Lilly & Co (NYSE:LLY) are down 6% Thursday despite the company reporting better-than-expected fourth-quarter results and raising its full-year EPS forecast.
Eli Lilly reported Q4 EPS of $2.09 on revenue of $7.3 billion, beating the consensus for earnings of $1.80 on revenue of $7.35B. Revenue fell nearly 9% as sales from Alimta plunged 46% to $236.6 million.
However, the drugmaker missed consensus expectations for sales of its Mounjaro drug as well as older diabetes treatment. Mounjaro is the company's newer diabetes treatment, which it had hoped would perform well and soften the impact of sales from price cuts for insulin. Mounjaro sales came in at $279.2M.
Lilly said that, excluding revenue from COVID-19 antibodies, revenue in the U.S. increased by 11%. The company reaffirmed its prior full-year revenue forecast of $30.3-30.8B.
The pharma company boosted its FY EPS forecast to the range of $8.35-8.55 from the prior $8.10-8.30, beating the $8.28 consensus. The increase is a result of a reduced tax rate assumption.
Anat Ashkenazi, Lilly's executive vice president and chief financial officer, said: "As we closed out 2022, Lilly demonstrated strong growth and achieved meaningful pipeline progress that included the launch for Mounjaro in type 2 diabetes. We expect to capitalize on this momentum and deliver mid-teen revenue growth for our core business in 2023 while remaining committed to investing in innovation, late-stage opportunities, manufacturing capacity, and our people."
Following the release, Credit Suisse analysts said Eli Lilly's Verzenio drug came in 22% ahead of expectation. However, they also noted that given the focus on diabetes, Mounjaro, and Trulicity sales came in 12% and 9% below consensus expectations. The analysts, who have an Outperform rating and a $400 per share price target on LLY, also stated for Trulicity, there were intermittent delays in fulfilling orders in the fourth quarter.
Elsewhere, at Morgan Stanley, analysts said, "LLY posted a 4Q beat on EPS driven by taxes, while Mounjaro came in above MS, but a touch below consensus."
"LLY reiterated 2023 rev guidance but raised EPS range on lower tax rate. We see shares likely unchanged," added the analysts, who have an Overweight rating and a $440 price target on the stock.