1. Eli Lilly and Company (NYSE:LLY)
3-Year Share Price Gains as of December 4: 234.2%
Eli Lilly and Company (NYSE:LLY) is an Indiana-based pharmaceutical company that manufactures and develops a wide range of medicines for serious ailments. The company received positive news regarding its weight loss programs, as President Joe Biden recently proposed extending Medicare and Medicaid coverage to this category of medications. If approved, the measure would make these treatments available to millions of additional patients, potentially driving a significant boost in sales. While the proposal’s outcome is uncertain, the market remains optimistic about the potential benefits for Eli Lilly. The stock has surged by nearly 40% since the start of 2024.
In fiscal Q4 2024, Eli Lilly and Company (NYSE:LLY) reported revenue of $11.4 billion, which showed a 20.5% growth from the same period last year. The company showed impressive growth of Mounjaro and Zepbound, alongside a notable 17% increase in non-incretin revenue. This growth, which includes contributions from its oncology, immunology, and neuroscience portfolios, was achieved compared to the same period in Q3 2023. Aristotle Atlantic Partners, LLC made the following comment about LLY in its Q3 2024 investor letter.
“Eli Lilly and Company (NYSE:LLY) is a leading pharmaceutical company that develops diabetes, oncology, immunology and neuroscience medicines. The company generates over half of its revenue in the U.S. from its leading drugs Trulicity, Verzenio and Taltz. The company operates in a single business segment: human pharmaceutical products.
Eli Lilly has a deep pipeline in treatment areas focused on metabolic disorders, oncology, immunology and central nervous system disorders. Currently, there are two phase-three assets: orforglipron, an oral GLP-1, and retatrutide, a triple incretin agonist, which could possibly expand upon the potential success of Mounjaro. We believe that Mounjaro has the potential to commercialize beyond Type 2 diabetes and obesity, potentially in the areas mentioned above of heart disease, sleep apnea, fatty liver disease and chronic kidney disease. We believe the premium valuation is supported by this outsized growth profile.”
On October 28, Eli Lilly and Company (NYSE:LLY) declared a quarterly dividend of $1.30 per share, which was in line with its previous dividend. Overall, the company has been growing its dividends for ten consecutive years, which makes it one of the best dividend knights. The stock supports a dividend yield of 0.63%, as of December 5.
The number of hedge funds tracked by Insider Monkey owning stakes in Eli Lilly and Company (NYSE:LLY) grew to 106 in Q3 2024, from 100 in the previous quarter. The consolidated value of these stakes is more than $18.5 billion. Ken Fisher’s Fisher Asset Management was the company’s leading stakeholder in Q3.
Overall, Eli Lilly and Company (NYSE:LLY) ranks first on our list of the best dividend knights. While we acknowledge the potential for LLY to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LLY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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