Eli Lilly and Company

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Broker Analyst Analyst Email
BMO Capital Markets Alex Arfaei alex.arfaei@bmo.com
Deutsche Bank Research Gregg Gilbert gregg.gilbert@db.com
SunTrust Robinson Humphrey John T. Boris john.t.boris@suntrust.com
Piper Jaffray Richard J. Purkiss richard.j.purkiss@pjc.com
Leerink Partners Seamus Fernandez seamus.fernandez@leerink.com
Atlantic Equities Steve Chesney s.chesney@atlantic-equities.com
Cowen & Company Steve Scala steve.scala@cowen.com
Bernstein Research Tim Anderson tim.anderson@bernstein.com
Guggenheim Securities Tony Butler tony.butler@guggenheimpartners.com
Credit Suisse Vamil Divan vamil.divan@credit-suisse.com

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Primary Input Data

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Derived Input Data

Derived Input

Label

2015 Value

2016
Value

Equational Form

Net Operating Profit Less Adjusted Taxes NOPLAT 2,335 2,516 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF 1,707 3,814 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS 24 111 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC 27,339 27,819 IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC 8.54%  9.04% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv 2,796 1,977 NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR  119.76% 78.56% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital
WACCMarket 11.52% 9.42% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook    7.10%  6.39%
Enterprise value
EVMarket  97,765  84,966 EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook    95,063  83,298
Long-Run Growth
g = IR x ROIC
  10.23%   7.11% Long-run growth rates of the income variable are used in the Continuing Value portion of the valuation models.
g = % \Delta GDP    2.50%   2.50%
Margin from Operations M   18.00%  18.24% M\,\,=\,\,\frac{EBIT}{SALES}
Depreciation/Amortization Rate D   28.44%  27.89% D\,\,=\,\,\frac{D+A}{EBITDA}

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Valuation Multiple Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs.

Equational Form

Observed Value

Single-stage

multiple g solution

Two-stage valuation

model g solution

12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016

EV/SALES 

\frac {EV}{Sales} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(M)

 4.90  4.00  12.68%  9.61%  12.26%  9.52%

EV/EBITDA

\frac {EV}{EBITDA} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(1\,-\,D)

19.48 15.83 12.68% 9.61% 12.26% 9.52%

EV/NOPLAT

\frac {EV}{NOPLAT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}

41.87 33.77 12.68% 9.61% 12.26% 9.52%

EV/FCFOPS

\frac {EV}{FCF_{OPS}} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

57.29 22.28 12.68% 9.61% 12.26% 9.52%

EV/EBIT

\frac {EV}{EBIT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

27.22 21.95 12.68% 9.61% 12.26% 9.52%

EV/IC

\frac {EV}{IC} \,= \,\frac{ROIC\,  -\,  g}{WACC\,-\,g}

3.58 3.05 12.68% 9.61% 12.26% 9.52%

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