UPDATE: Goldman Sachs Downgrades Eli Lilly & Company on Relative Lack of Differentiation in Pipeline

In a report published Monday, Goldman Sachs analyst Jami Rubin downgraded the rating on Eli Lilly & Company LLY from Neutral to Sell, and lowered the price target from $52.00 to $48.00. In the report, Goldman Sachs noted, “As LLY's primary care business declines due to patent expirations, the new product portfolio is increasingly important to support LLY's earnings post 2014. However, we see a lack of differentiation for key pipeline products in LLY's diabetes and oncology portfolios which comprise the majority of LLY's new products. Despite flat EPS prospects from 2013-2018, which assumes Alimta's 2022 patent prevails, and limited potential for structural or new pipeline optionality (we see Sola's prospects as dim), the stock's premium valuation (19X 2014E and 16x 2015 versus ABBV's P/E of 15x) creates more risk to the downside relative to other names in our sector.” Eli Lilly & Company closed on Friday at $50.63.
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Posted In: Analyst ColorDowngradesAnalyst RatingsGoldman SachsJami Rubin
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