On October 11, 2023, Lilly Endowment Inc., a private philanthropic foundation, executed a significant transaction in the stock market. The firm reduced its holdings in Eli Lilly and Co., a leading pharmaceutical company. This article provides an in-depth analysis of the transaction, the profiles of both Lilly Endowment Inc. and Eli Lilly and Co., and the potential implications for value investors.
Details of the Transaction
The transaction took place on October 11, 2023, with Lilly Endowment Inc. reducing its stake in Eli Lilly and Co. by 215,000 shares. This move resulted in a -0.22% change in the firm's holdings and had a -0.27% impact on its portfolio. Despite the reduction, Lilly Endowment Inc. still holds a substantial 99,768,810 shares in Eli Lilly and Co., representing 10.51% of the company's total shares and 127.84% of the firm's portfolio.
Profile of Lilly Endowment Inc.
Lilly Endowment Inc. is a private philanthropic foundation based in Indianapolis. Founded in 1937 by the Lilly family, the firm operates independently from the Eli Lilly and Company pharmaceutical business. Lilly Endowment Inc. supports causes of religion, education, and community development, with a majority focus on organizations operating out of Indiana. The firm's assets are entirely made up of Eli Lilly and Company shares, and it currently has a market value of $9.5 billion. Lilly Endowment Inc. holds only one stock in its portfolio, Eli Lilly and Co., which makes up the entirety of its assets.
Overview of Eli Lilly and Co.
Eli Lilly and Co., with a market capitalization of $579.54 billion, is a drug firm focusing on neuroscience, cardiometabolic, cancer, and immunology. The company's key products include Verzenio for cancer and Taltz and Olumiant for immunology. As of October 13, 2023, the company's stock price stands at $610.5, with a PE percentage of 86.12. However, according to GuruFocus's GF Valuation, the stock is significantly overvalued, with a GF Value of 318.14 and a Price to GF Value ratio of 1.92. The company's GF Score is 75/100, indicating a likely average performance.
Analysis of Eli Lilly and Co.'s Financial Health
Eli Lilly and Co. has a Balance Sheet Rank of 6/10, a Profitability Rank of 9/10, and a Growth Rank of 8/10. The company's interest coverage is 21.35, and its Altman Z score is 9.28. Eli Lilly and Co. has a ROE of 63.06 and a ROA of 12.89. The company's Operating Margin growth is 5.40, and its EBITDA growth over the past three years is 9.10.
Comparison with Other Gurus
Other gurus, including Ken Fisher (Trades, Portfolio), Dodge & Cox, and Ron Baron (Trades, Portfolio), also hold shares in Eli Lilly and Co. The largest guru holder of Eli Lilly and Co. shares is the Vanguard Health Care Fund (Trades, Portfolio).
Conclusion
In conclusion, Lilly Endowment Inc.'s recent transaction in Eli Lilly and Co. represents a significant move in the stock market. Despite the reduction, the firm still holds a substantial stake in the pharmaceutical company. Value investors should closely monitor the performance of Eli Lilly and Co., considering its financial health and the interest of other gurus in the stock.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
