Bank of America has stuck by Eli Lilly and Co (NYSE:LLY) despite underwhelming sales of its weight loss and diabetes products, Zepbound and Mounjaro, in the third quarter.
Reiterating a ‘buy’ rating, Bank of America noted it remained “positive” on Eli “on weakening manufacturing headwinds and acceleration of on-demand activities”.
Eli had slashed guidance for the year on lower-than-expected revenue of $11.44 billion over the third quarter, which was in part driven by lower weight loss sales on inventory scale-backs.
Bank of America dubbed the sales miss a “hiccup”, noting the company’s assurance that the hit was inventory and not demand-related.
Eli continued to make progress on Alzheimer’s products, Bank of America added, highlighting an expected submission for a new dosing process for Kisunla.
Plans had also been laid out for a range of other studies relating to the likes of antidiabetic Tirzepatide, which analysts said could “support Lilly's peer-leading growth profile” ahead.
Upcoming updates on obesity trials from the likes of Novo Nordisk (NYSE:NVO) and Amgen in the coming months were set to be in focus, according to Bank of America, which set a share price target of $1,100 for Eli, against to $1,150 previously.
Shares fell 1.1% to $837.85 on Thursday.