UPDATE: JP Morgan Upgrades Eli Lilly to Neutral

JP Morgan raises its rating on Eli Lilly LLY to Neutral from Underweight as downside is limited through cost cuts. Price target is at $40 a share on Thursday. JP Morgan says, "Since our downgrade of LLY shares in September 2008, we have viewed the stock as having an unattractive risk/reward as a result of limited pipeline clarity, expense growth depressing margins and a looming patent cliff. However, as we now look out over the next 12-18 months, in our view, we are approaching a period during which either Lilly's pipeline will succeed or the company will need to more significantly reevaluate its overall cost structure." LLY closed at $39.35 a share on Thursday.