The Dividend Daily

Pharmaceutical company Eli Lilly & Co. (LLY) saw a dip in fourth quarter profits on Monday as competition from generic drugs put pressure on current products. However, the adjusted results exceeded the Wall Street view.

The Indianapolis, Indiana-based company earned $827 million, or 74 cents per share, in the fourth quarter. These results were down -4% from $858 million, or 77 cents per share, earned a year earlier.

Adjusting for special items such as restructuring costs, LLY earned 85 cents per share. This beat the Wall Street view of 78 cents per share.

Revenue dipped slightly to $5.96 billion, but this still exceeded analysts’ expectation of $5.81 billion.

The drug maker saw a decline in profits and revenue largely due to competition from generic drugs as patents begin to expire. However, the company was able to offset some of the negative impact from competition because of the strong sales of other drugs and various cost control measures.

Eli Lilly is now forecasting 2013 earnings will be up by 13% to 17% to $3.82 to $3.97 per share. The results will be helped by cost controls and R&D tax credits.

Eli Lilly shares were mostly flat during pre-market trading on Tuesday. The stock is up +34.29% over the past year.

The Bottom Line
Shares of Eli Lilly (LLY) have a dividend yield of 3.72% based on last night’s closing price of $52.64.

Eli Lilly & Co. (LLY) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

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