10 Best Low Volatility Stocks to Invest in Now

3. Eli Lilly and Company (NYSE:LLY)

Number of Hedge Fund Holders: 100

5-year Beta (Monthly): 0.42

Eli Lilly and Company (NYSE:LLY) is a global pharmaceutical firm that focuses on discovering, developing, and marketing medications. It offers a range of diabetes and obesity treatments, oncology as well as medications for various conditions such as rheumatoid arthritis, migraine prevention, and erectile dysfunction.

The company also operates the Lilly Seaport Innovation Center in Boston, which focuses on RNA and DNA-based therapies and finding new drug targets for conditions like obesity and chronic pain. The company collaborates with several other pharmaceutical firms as well.

Eli Lilly’s (NYSE:LLY) third-quarter performance showed impressive revenue growth due to several factors. However, it missed expectations despite the growth. The surge was led by the success of new products, especially Mounjaro and Zepbound, the company’s diabetes and obesity drugs, accounting for $3 billion of the total $11.44 billion revenue (total revenue was up 20% year-over-year).

Nevertheless, their sales were still lower than expected as the company attributed this shortfall not to a lack of demand, but to wholesalers reducing their inventory of these medications. According to the company, it had successfully completed back orders in the previous quarter, which increased stock levels. Wholesalers then used that stock instead of ordering more, leading to lower sales for both drugs.

Due to these factors, Eli Lilly’s (NYSE:LLY) stock experienced a significant sell-off after its earnings report on October 30 and was down over 8% in a day. JPMorgan analyst Chris Schott sees the decline in its shares as a buying opportunity. The Fly reported on October 31 that the analyst maintained an Overweight rating on the stock with a price target of $1,100.

Schott noted that despite the company’s results falling short of expectations due to wholesaler destocking of Mounjaro and Zepbound, the underlying business volume trends remain strong. He anticipates a substantial increase in sales for the fourth quarter as capacity increases and demand-generating efforts are improved.

Eli Lilly (NYSE:LLY) also reported strong performance across its oncology, immunology, and neuroscience portfolios, with a 17% growth in non-hormonal medication revenue. Key pipeline milestones included U.S. approval of Ebglyss for atopic dermatitis and Kisunla for early symptomatic Alzheimer’s disease. The company plans to submit a supplemental application to the FDA for a modified dosing regimen for donanemab after positive results in reducing ARIA (amyloid-related imaging abnormalities) were observed in a Phase 3 trial.