Eli Lilly and Co (NYSE:LLY) Started with a Sell at Stock Traders Daily

Extra items influencing EPS make shares of Eli Lilly and Co (NYSE:LLY) look very expensive to the naked eye, with a public PE of about 30x, but even after extracting those items the PE is still over 20x.  This is expensive too, and part of the rationale for the sell rating initiated by Stock Traders Daily.

Earnings Growth is better, but it is not expected to keep pace this year, and the corresponding PEG ratio for LLY makes the stock look overvalued.

Our current macroeconomic assessments suggest that material weakness can befall US equity markets as 2016 continues as well, as that is specifically defined by our proprietary macroeconomic analysis, The Investment Rate, which identifies long term stock market and economic cycles by measuring the rate of change of new money available to be invested into domestic asset classes annually between 1900 and 2040.

The weakness we foresee in the Equity Market will cause investors to shy away from stocks that lack value, and we consider LLY to be such a stock.  

Review the Trading Plans:

Technical Summary

Term →Near Mid Long
Bias Weak Neutral Neutral
P1 68.29 64.71 68.06
P2 70.44 69.71 75.83
P3 72.12 74.51 83.63

Long Term Trading Plans for LLY

March 22, 2016, 10:27 am ET

The technical Summary and associated Trading Plans for LLY listed below will help you make important timing decisions for your trades. This data is based on our proprietary analysis for LLY. In addition we offer Market Timing Models and Stock Filters in the links above which may increase the proficiency of the decisions you make.

LLY - (Long) Support Plan

Buy over 68.06 target 75.83 stop loss @ 67.8.
The technical summary data tells us to buy LLY near 68.06 with an upside target of 75.83. This data also tells us to set a stop loss @ 67.8 to protect against excessive loss in case the stock begins to move against the trade. 68.06 is the first level of support below 70.25 , and by rule, any test of support is a buy signal. In this case, support 68.06 would be being tested, so a buy signal would exist.

LLY - (Short) Resistance Plan

Short under 75.83 target 68.06 stop loss @ 76.09.
The technical summary data is suggesting a short of LLY as it gets near 75.83 with a downside target of 68.06. We should have a stop loss in place at 76.09 though. 75.83 is the first level of resistance above 70.25, and by rule, any test of resistance is a short signal. In this case, if resistance 75.83 is being tested, so a short signal would exist.

LLY Long Term Analysis

LLY EPS Analysis

LLY Dividend Chart

LLY Revenue chart

LLY Growth rate - Quarterly

LLY Growth rate - Yearly

LLY PE chart

LLY PEG chart