Shares of Eli Lilly ( LLY -2.67% ) were dropping sharply on Tuesday, down by 5.3% as of 12:12 p.m. EDT after falling by as much as 6.2% earlier. Investors are reacting to the drugmaker's disappointing third-quarter earnings report, which it released before the market opened today.
During its third quarter, Eli Lilly's revenue came in at $5.7 billion. While that was a 5% increase from last year's third quarter, it also came in short of the $5.91 billion analysts were expecting on average. This was despite several of the company's products performing well during the quarter. For instance, sales of diabetes medicine Trulicity increased by 9% year over year to $1.11 billion, while revenue from plaque psoriasis treatment Taltz soared by 34% to $454.5 million.
Alimta, a cancer medicine, saw its sales grow by 14% year over year to $578 million.
Adjusted earnings per share were $1.54, compared with $1.48 during the year-ago period. But again, the pharma giant came up short of expectations on the bottom line; on average, analysts expected the company to deliver adjusted EPS of $1.71.
Eli Lilly performed well during the first half of the year, but its shares have been dropping since late July. After today's decline, the stock is up by only 2.1% year to date, compared with gains of 5.4% for the S&P 500. Despite its disappointing earnings report, it may be worth it for long-term investors to consider scooping up shares of this pharma stock, particularly at current levels.