Eli Lilly & Co Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Eli Lilly & Co (NYSE:LLY) will unveil its latest earnings tomorrow, Tuesday, January 29, 2013. Eli Lilly develops and manufactures pharmaceutical products as well as animal health products.

Eli Lilly & Co Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 78 cents per share, a decline of 10.3% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 82 cents. Between one and three months ago, the average estimate moved up. It has dropped from 83 cents during the last month. For the year, analysts are projecting net income of $3.33 per share, a decline of 24.5% from last year.

Past Earnings Performance: The company missed estimates last quarter after beating forecasts in the prior two. In the third quarter, the company reported profit of 79 cents per share versus a mean estimate of net income of 83 cents per share. In the second quarter, the company beat estimates by 6 cents.

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A Look Back: In the third quarter, profit rose 7.3% to $1.33 billion ($1.18 a share) from $1.24 billion ($1.11 a share) the year earlier, but fell short analyst expectations. Revenue fell 11.5% to $5.44 billion from $6.15 billion.

Here’s how Eli Lilly & Co traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

lly

Wall St. Revenue Expectations: Analysts predict a decline of 4% in revenue from the year-earlier quarter to $5.81 billion.

Analyst Ratings: With five analysts rating the stock as a buy, three rating it as a sell and eight rating it as a hold, there are indications of a bullish outlook.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of four-straight quarters of revenue decreases. Revenue fell 2.3% in the fourth quarter of the last fiscal year, 4.1% in first quarter and 10.4% in the second quarter and then fell again in the third quarter.

Last quarter’s earnings rise was a switch from preceding drops, so the upcoming earnings announcement is a chance to build on last quarter’s result. Net income fell in the fourth quarter of the last fiscal year, the first quarter and the second quarter before snapping that run with a profit increase in the third quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.02 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company improved this liquidity measure from 1.86 in the second quarter to the last quarter driven in part by an increase in current assets. Current assets increased 14.1% to $14.04 billion while liabilities rose by 5.3% to $6.96 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)