This top pharmaceutical should do just fine regardless of headline risk in the summer. Eli Lilly and Co. (NYSE: LLY) is a global health care company with numerous core products in a number of primary-care pharmaceutical markets. The company generates revenues from its pharmaceutical product and animal health segments.
The product portfolio includes Zyprexa (for schizophrenia and bipolar disorder), Gemzar (pancreatic cancer), Evista (osteoporosis), Cymbalta (depression), Cialis (erectile dysfunction), Strattera (attention deficit hyperactivity disorder), Erbitux (cancer) and Alimta (chemotherapy). Eli Lilly also has a strong presence in the diabetes market.
Reported first-quarter earnings and revenue came in just slightly under consensus. While the overall numbers were unremarkable in the analysts view, the Merrill Lynch team is still very focused on the company’s outstanding late-stage product pipeline, which they view as very undervalued. Eli Lilly did however raise the company’s 2016 earnings per share and revenue guidance to above the consensus estimates.
Shareholders are paid a solid 2.75% dividend. The consensus price target for the stock is $95.71, and shares closed on Tuesday at $74.99.
This top pharmaceutical company recently made a gigantic bid for Anacor Pharmaceuticals. Pfizer Inc. (NYSE: PFE) has a very strong pipeline, and being the world’s largest drug manufacturer by sales value supports the Wall Street notion that the company can generate higher long-term revenues through the accelerated growth of its new drugs over the next five years.
The Treasury Department announced new rules for corporate tax inversions, which effectively scuttled Pfizer’s deal with Allergan. With the deal over, not only are the risk arbitrage funds buying the stock back, but some felt there was as much as a $5 weight on the stock, but top analysts now feel that investors can once again focus on the sum-of-the-parts story, which they feel is compelling, in addition to making accretive purchases like Anacor.
Pfizer has announced that it is starting 20 clinical trials this year, and more soon after, on treatments to conquer cancer, as it also seeks to gain leadership in one of the hottest and most lucrative areas of medicine. Hedge funds seem to like the stock as a total of 22 own it now.
Pfizer investors are paid a rich 3.52% dividend. The posted consensus price target for the stock is $38.62. The stock closed Tuesday at $34.10 per share.
Despite the ongoing political candidate chirping, all of these quality big pharmaceutical stocks have been around, and they will continue to stay around. Investors may want to buy partial positions and watch how the election cycle plays out.