Wall Street liked what it saw from GE Healthcare and Eli Lilly in their earnings reports, leading to a round of well-deserved price target increases for Club stock. Analysts at four equity research firms raised their price targets for GE Healthcare since the maker of MRI machines and other medical equipment on Tuesday delivered better-than-expected fourth-quarter results and optimistic guidance for 2024. While Meanwhile, at least eight analysts raised their Eli Lilly price targets after the pharmaceutical giant provided an encouraging update Tuesday on its flagship drug, tirzepatide, currently marketed as Mounjaro for type 2 diabetes and Zepbound for obesity. . Not only did sales data look strong for those two approved treatments, but the company said tirzepatide showed promise in treating fatty liver disease in a mid-stage trial. In our earnings analysis, we raised our Club price targets on GE Healthcare to $92 per share from $91 and Eli Lilly to $750 from $630. But, it is true that the update on fatty liver disease, combined with some emerging questions about the obesity process at Amgen, one of the many pharmaceutical companies trying to get a piece of the burgeoning weight loss market, makes us think we were too conservative with Lilly. . GE Healthcare fell slightly on Wednesday, maintaining most of Tuesday's nearly 11.7% gain. Eli Lilly, which fell slightly on Tuesday, rose nearly 3% on Wednesday to $725.38, another record close. The analyst community's upbeat response to GE Healthcare's quarter and guidance is notable considering it has been a battleground stock for most of its nine months in our portfolio. It spent the end of July and most of August and September falling in a somewhat confusing manner, and we took advantage of the decline to buy shares below $70 each on multiple occasions. GEHC 1Y mountain GE Healthcare stock performance over the last 12 months. The biggest boost to the price target for GE Healthcare came from Piper Sandler, which moved from $84 to $94 per share and reiterated its buy-equivalent rating. The company's medtech analysts also upgraded GE Healthcare to their 2024 preferred stock list, citing their belief that the company can achieve at least the high end of its earnings per share outlook of between 4.20 and $4.35 and a discounted valuation. compared to his peers. Mizuho Securities, one of the early bulls on GE Healthcare after the company was spun off from former parent General Electric in January 2023, raised its price target on the stock to $96 from $94. Mizuho said he believes the risk of a major negative surprise related to the company's operations in China, amid an anti-corruption campaign targeting the country's healthcare industry, is “gradually diminishing.” We trimmed our position in GE Healthcare last week, just to be safe in case China turned out to be a black eye in Tuesday's earnings report, but ultimately the situation has remained better than feared. And GEHC's guidance assumes weakness in China in the first half of the year, before returning to growth in the final six months. Evercore ISI and Wells Fargo were behind GE Healthcare's two other price target increases; Both companies maintained buy ratings on the stock. Evercore rose to $93 a share from $86, arguing the stock deserves a “rerating” after delivering double-digit earnings-per-share growth. Meanwhile, Wells Fargo raised its target to $90 per share from $85. The positive research and price target increases following Eli Lilly's quarter and guidance aren't necessarily a surprise, even if Tuesday's market reaction was muted against a backdrop of sky-high expectations. The reason is that Eli Lilly has had great supporters in the analyst community for quite some time, and of course we too have liked the stock and owned it for years. LLY 1Y mountain Eli Lilly stock performance over the past 12 months. BMO Capital Markets and Truist Securities raised their price targets for Eli Lilly to $865 from $710 and $850 from $650, respectively. They appear to be the highest on Wall Street, according to FactSet data available to CNBC. Both companies have buy ratings on Lilly stock. Truist's more optimistic outlook reflects “increased conviction” in Eli Lilly's drug trafficking and Mounjaro and Zepbound's lawsuit, analysts wrote to clients on Tuesday. Truist now expects sales of the drugs to reach $65 billion at their peak, up from $45 billion previously. Cantor Fitzgerald ($815 from $630), Bank of America ($800 from $750), Barclays ($810 from $680), Wells Fargo ($825 from $700) and Morgan Stanley ($805 from $763) were the other research firms with buy ratings for Eli. Lilly will raise its price targets. The continued launch of Mounjaro and Zepbound “is likely to drive upward revisions to revenue estimates and drive margin expansion, albeit at a more measured pace in 2024, and the company has the strongest growth profile within our universe.” coverage,” Morgan Stanley wrote in a note to clients on Wednesday. Goldman Sachs, which maintains a rating on Eli Lilly, raised its price target from $600 to $650 per share. (Jim Cramer's Charitable Trust is long GEHC and LLY. See here for a full list of stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable fund's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH OUR DISCLAIMER. NO FIDUCIARY OBLIGATION OR DUTY EXISTS OR IS CREATED BY VIRTUE OF THE RECEIPT OF ANY INFORMATION PROVIDED IN RELATION TO THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR BENEFITS ARE GUARANTEED.
In the emergency room of the university hospital (UKJ) in Jena, Germany, an examination with a CT scanner is being prepared. GE Healthcare's scanner is called Revolution CT.
Martin Schutt | image alliance | fake images
Wall Street liked what it saw GE healthcare and Eli Lilly in its earnings reports, leading to a round of well-deserved target price increases for the Club's shares.
