Two 59%+ winners, four above 25% in Aug – How this AI model keeps picking winners
Investing.com - Leerink Partners upgraded Elanco Animal Health (NYSE:ELAN) from Market Perform to Outperform on Thursday, setting a price target of $18.00. Currently trading at $14.51, the company shows promising fundamentals with a P/E ratio of 19.3x and a market capitalization of $7.2 billion.
The upgrade comes as the research firm expresses increased conviction in Elanco’s Pet Health product launches, particularly Credelio Quattro in the US market, while maintaining a positive outlook on growth prospects within the company’s Farm Animal segment. The company maintains a healthy gross profit margin of 54.9%, according to InvestingPro data, which shows 8 additional key insights about ELAN’s financial health.
Leerink’s confidence stems from channel checks and a semiannual veterinarian survey showing growing interest in Elanco’s Quattro and Zenrelia products, suggesting potential for further stock re-rating despite recent rebounds from tariff-driven lows.
The firm forecasts Elanco’s 2025 earnings per share at $0.85, 2026 EPS at $0.95, and 2027 EPS at $1.11, projecting mid-single-digit sales growth and margin expansion as sales and marketing efficiency improves following product launches.
According to Leerink Partners, this growth trajectory represents the best estimated growth profile in their coverage universe while trading at the lowest multiple, with a path to mid-double-digit EPS growth in future years.
In other recent news, Elanco Animal Health has announced several developments that could impact its business trajectory. The U.S. Department of Agriculture approved Elanco’s TruCan Ultra CIV H3N2/H3N8 vaccine for canine influenza, which is now available for pre-order and expected to ship within 30 business days. This vaccine offers protection against key strains of canine influenza, with studies showing it reduces viral shedding and prevents lung lesions in vaccinated dogs. In financial analyses, Stifel raised its price target for Elanco to $17, citing gains in the parasiticide market and improved relations with veterinarians. William Blair upgraded Elanco’s stock rating to Outperform, emphasizing the stabilization of its core business and a promising innovation pipeline. Additionally, Elanco received a positive opinion from the European Medicines Agency for Zenrelia, its treatment for canine allergic dermatitis, paving the way for EU market entry. Leerink Partners also increased its price target for Elanco, expecting revenue growth in 2025 driven by new product launches like Zenrelia and Credelio Quattro. Despite these positive notes, Leerink expressed caution due to rising competition and uncertainty about product uptake.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.