DCF Studio

    LLY · NYQ · Healthcare

    Eli Lilly and Company

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 778.84

    Market price

    USD 1410.99

    Implied upside

    -44.8%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedCapital expenditure runs at 16.9% of revenue against depreciation of 4.2%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Current EV/EBITDA of 40.8x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 778.84-44.8%
    Exit multiple
    USD 1035.07-26.6%
    Market price
    USD 1410.99

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn25bn49bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 91.7bnUSD 105.2bnUSD 119.1bnUSD 133.0bnUSD 146.5bnUSD 159.2bnUSD 170.4bnUSD 179.9bnUSD 187.2bnUSD 191.9bn+8.6%
    EBITUSD 32.7bnUSD 37.5bnUSD 42.5bnUSD 47.4bnUSD 52.3bnUSD 56.8bnUSD 60.8bnUSD 64.2bnUSD 66.8bnUSD 68.4bn+8.6%
    NOPATUSD 26.8bnUSD 30.7bnUSD 34.8bnUSD 38.8bnUSD 42.8bnUSD 46.5bnUSD 49.8bnUSD 52.5bnUSD 54.7bnUSD 56.0bn+8.6%
    Add depreciation & amortisationUSD 3.8bnUSD 4.4bnUSD 5.0bnUSD 5.6bnUSD 6.2bnUSD 6.7bnUSD 7.2bnUSD 7.6bnUSD 7.9bnUSD 8.1bn+8.6%
    Less capital expenditureUSD -15.5bnUSD -16.6bnUSD -17.4bnUSD -18.0bnUSD -18.2bnUSD -18.0bnUSD -17.4bnUSD -16.4bnUSD -15.0bnUSD -13.2bn-1.7%
    Capex, % of revenue16.9%15.7%14.6%13.5%12.4%11.3%10.2%9.1%8.0%6.9%-
    Less increase in working capitalUSD -9.3bnUSD -4.7bnUSD -4.9bnUSD -4.9bnUSD -4.7bnUSD -4.4bnUSD -4.0bnUSD -3.3bnUSD -2.5bnUSD -1.6bn-17.5%
    Free cashflow to firmUSD 5.9bnUSD 13.8bnUSD 17.5bnUSD 21.5bnUSD 26.0bnUSD 30.7bnUSD 35.6bnUSD 40.4bnUSD 45.0bnUSD 49.2bn+26.6%
    Discount factor0.96520.89930.83780.78060.72720.67750.63120.58810.54790.5104-
    Present valueUSD 5.7bnUSD 12.4bnUSD 14.6bnUSD 16.8bnUSD 18.9bnUSD 20.8bnUSD 22.5bnUSD 23.8bnUSD 24.7bnUSD 25.1bn-
    Present Value Of The ForecastUSD 185.3bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.591Reported 0.389, pulled toward 1.0 (Blume)
    Cost of equity7.39%Risk-free + beta x equity risk premium
    Cost of debt6.89%Assumed: risk-free + 200bp (interest expense not reported)
    Market capitalisationUSD 1256.8bn96.7% of capital
    Total debtUSD 42.5bn3.3% of capital, book value as a proxy
    Tax rate18.1%Effective, capped at statutory
    WACC7.34%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 778.84

    75% of EV

    Forecast FCFF, final year
    USD 49.2bn
    Capex at depreciation, working capital in reinvestment
    USD 56.0bn
    Less reinvestment at g/ROIC (9.2% of NOPAT)
    USD -5.2bn
    Capitalised
    USD 50.9bn
    ROIC (reported)
    27.2%
    Terminal value, undiscounted
    USD 1078.2bn
    Terminal value, discounted
    USD 550.4bn
    Enterprise value
    USD 735.6bn
    Less net debt
    USD 35.2bn
    Equity value
    USD 700.4bn

    Exit at 20.0x EBITDA

    Value per shareUSD 1035.07

    81% of EV

    Terminal value, undiscounted
    USD 1529.7bn
    Terminal value, discounted
    USD 780.8bn
    Enterprise value
    USD 966.1bn
    Less net debt
    USD 35.2bn
    Equity value
    USD 930.8bn

    Spread between methods: 28%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.34%1148.801271.761439.101679.302051.92
    6.34%874.39939.321021.871129.981277.15
    7.34%695.55733.05778.83835.74908.15
    8.34%570.24593.12620.32653.06693.06
    9.34%477.88492.30509.15529.02552.67

    Outlined: this model. Green text: above today's price of 1410.99. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year31.7%11.4%18.5%
    EBIT margin45.6%35.7%60.0%
    Discount rate-7.3%5.4%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.