Shares of Eli Lilly and Company (LLY -2.02%) were jumping 6% higher as of 11:03 a.m. ET on Tuesday. The solid gain came after the big drugmaker announced its first-quarter 2024 results.
Lilly reported Q1 revenue of $8.77 billion, up 26% year over year. This result came in a little below the average analyst's revenue estimate of $8.92 billion.
However, Lilly made up for the miss with its bottom line. The company posted Q1 net income of $2.24 billion, or $2.48 per share, based on generally accepted accounting principles (GAAP). Non-GAAP earnings were nearly $2.34 billion, or $2.58 per share. The consensus Wall Street estimate was for non-GAAP earnings of $2.46 per share.
What really made investors happy with Eli Lilly's update
Investors like it when companies top quarterly earnings expectations. But they love it when companies have an earnings beat and raise guidance. Eli Lilly did both in its Q1 update.
Lilly increased its 2024 full-year revenue outlook to a range of $42.4 billion to $43.6 billion, $2 billion higher than its previous guidance. The company said that it was able to boost its forecast largely due to tremendous sales growth for type 2 diabetes drug Mounjaro and weight loss drug Zepbound.
The big drugmaker also increased its full-year GAAP earnings per share (EPS) guidance to between $13.05 to $13.55, up $1.25. Lilly raised its non-GAAP EPS guidance by $1.30 to a range of $13.50 to $14.
Is Eli Lilly stock a buy after its Q1 earnings bump?
Lilly might seem priced for perfection with shares trading over 59 times forward earnings after its Q1 earnings bump. However, the company's growth prospects make its valuation much more palatable. I think Lilly remains a solid stock to buy for long-term investors.
