Eli Lilly rose Friday after topping Wall Street's first-quarter expectations. Eli Lilly stock bounced back after tumbling Thursday after CVS' Caremark selected Novo Nordisk's Wegovy as its preferred weight-loss drug.
This will begin affecting sales of Lilly's rival weight-loss drug, Zepbound, in July, Evercore ISI analyst Umer Raffat said in a report. Notably, this doesn't apply to all CVS/Aetna patients, but it does apply to those whose insurers follow the national formulary. That's about 30 million people — which is much lower that CVS' total 27% of the market.
Lilly kept its sales outlook for the year, but cut its profit outlook. Analysts also noted that total sales would have missed, but Eli Lilly benefited from a one-time collaboration payment of $370 million from privately held Boehringer Ingelheim. Without that, sales would have missed by 3%, Leerink Partners analyst David Risinger said in a report.
In morning trades, Eli Lilly stock gained more than 2% to 815.01. Novo shares rose more than 5% to 68.98.
Eli Lilly Stock: Sales, Earnings Beat
In total, Lilly earned an adjusted $3.34 per share on $12.73 billion in first-quarter sales. Profit climbed 29% and beat forecasts for $3.26 a share. Sales rocketed 45% and were ahead of the Street's call for $12.67 billion.
Notably, sales of weight-loss drug Zepbound came in at $2.31 billion, topping projections for $2.26 billion. The diabetes drug Mounjaro, which uses the same active ingredient as Zepbound, generated $3.84 billion, beating calls for $3.8 billion, according to FactSet.
But Evercore's Raffat noted U.S. sales of Zepbound beat forecasts, while U.S. sales of Mounjaro missed.
"However, the relative magnitude of the beat was a little lesser than I thought and Mounjaro U.S. miss was a bit more," he said in a report. "When I looked at my math more closely, I noticed that consensus itself had inched up on both those lines."
Profit Guidance Gets A Haircut
On a bearish note, Lilly cut its profit outlook for the year and now expects adjusted earnings of $20.78 to $44.28 per share, down $1.72 per share at the midpoint from the company's previous guidance. Analysts projected earnings of $22.22 per share. Lilly noted the guidance cut is due to tax charges and net losses on investments in equity securities.
But Lilly kept its sales outlook for $58 billion to $61 billion, vs. analysts' call for $59.72 billion.
Eli Lilly stock had run up markedly within the bounds of a double-bottom base with an entry at 953.63, according to MarketSurge. After bottoming out at 677.09 on April 7, Lilly shares have risen roughly 33%.
Shares also have a nearly perfect IBD Digital Composite Rating of 98. The 1-99 score measures key fundamental and technical metrics. The Relative Strength Rating — a measure of performance over the past 12 months — has improved to 87 from 52 a month ago.
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
