HSBC cut its rating to "reduce" from "buy," and slashed its price objective
Eli Lilly And Co (NYSE:LLY) stock is 1.6% lower to trade at $870.31 at last check, after a rare double downgrade from HSBC to "reduce" from "buy," and a price-target cut to $700 from $1,150. The analyst in coverage cited strong competition and valuation concerns.
Coming into today, the majority of analysts were bullish toward the equity. In fact, 22 of 25 firms in coverage sport a "buy" or better rating, while the 12-month consensus target price of $998.05 is a 14.3% premium to current levels.
Despite today's bear note, the security still sports a 12.8% year-to-date lead. The shares could today snap a four-day win streak, but are still trading well above the 200-day moving average after conquering this trendline last week on a bounce off their April 7, 52-week low of $677.09.
Short-term options traders are bearish, however, per Eli Lilly stock's Schaeffer's put/call open interest ratio (SOIR) of 1.13 that sits in the 95th percentile of readings from the past 12 months. In other words, puts have been getting picked up at a quicker-than-usual rate.