The world’s largest pharmaceutical company by market capitalization, Elie Lilly (NYSE:LLY), continues to share part of its profits with its shareholders. The company maintained its quarterly dividend payments and declared a new distribution on Monday. Investors like receiving money from their company, and this next payment is generous compared to what it was just a few months ago.
New dividend declared
That morning, Eli Lilly announced that its next quarterly dividend would be equal to its predecessor’s, at $1.30 per share. This sum must be paid on June 10 to shareholders registered on May 16.
At the end of last year, the pharmaceutical The giant increased the dividend, bringing the payout to the current level of $1.13 per share, an increase of 15%. However, the company’s stock price has accelerated faster than that, so the dividend yield on the increased amount is only 0.7%; this is not only below the average of 1.3% for S&P500 index stocks, but it is overshadowed by its rivals in the pharmaceutical sector.
Still, in this case, any dividend is the icing on Eli Lilly’s cake, and it’s welcome. The company recently gained due attention with Zepbound, which is essentially its Mounjaro diabetes treatment repackaged and approved by the Food and Drug Administration (FDA) for obesity.
This propelled Eli Lilly into a booming, high-demand sector of the pharmaceutical market. In the United States in particular, obesity is a problem and many people are looking for a relatively simple solution: weight loss medication.
A reliable and growing payment
Eli Lilly has never been, and probably never will be, considered a high dividend stock. However, it is a stable and reliable payer that usually increases its payments once a year, which adds to the attractiveness of the company. If Zepbound takes off as many expect, shareholders can expect higher dividend increases in the future.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the securities mentioned. The Mad Motley has a disclosure policy.
Why Eli Lilly Stock Jumped 4% Today was originally published by The Motley Fool
