Eli Lilly (LLY) snapped nine straight sessions of losses on Wednesday after its shares settled 1.16% higher at $993.64.
The company ended in the red in each session between November 26 and December 9. It declined 11% during the period.
While the drugmaker’s shares were seen gaining on Wednesday, French biotech firm Abivax (ABVX) also rose in tandem, in a move Reuters attributed to market speculation about a potential takeover bid from the former.
The “share price movement is driven by speculation around a possible takeover,” Stifel analyst Damien Choplain said.
Last week, Lilly also announced plans to spend $6B to construct a facility to produce active pharmaceutical ingredients in Huntsville, Ala. The pharma firm said one of the drugs to be manufactured there is orforglipron, its oral GLP-1 candidate for obesity.
As per Seeking Alpha’s quant rating, the stock has a Hold rating with a score of 3.43 out of 5. LLY has been rated an A+ for growth and profitability but has been graded D- for valuation.
However, both Seeking Alpha and Wall Street analysts have issued a Buy call for the firm.
Seeking Alpha analyst Petri Dish Reports was bullish on the firm’s plans to add Mounjaro to China’s national reimbursement list, dramatically expanding its reach in the diabetes market.
The analyst said that they will be keeping a close eye on Lilly’s ability to secure reimbursement in China for Mounjaro’s obesity and sleep-apnea indications. They expect the potential move to have significant impact on the stock’s performance.
“Despite trading at a premium (42.7x forward P/E), LLY’s robust earnings growth projections and China’s market potential justify continued optimism,” the analyst said.