Morgan Stanley analyst Erin Wright maintained a Hold rating on Elanco Animal Health today and set a price target of $18.00.
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Erin Wright has given his Hold rating due to a combination of factors surrounding Elanco Animal Health’s strategic plans and financial outlook. The company has laid out a credible path for growth driven by innovation and margin expansion, yet the success of these plans heavily relies on consistent execution, particularly in achieving regulatory milestones, global launches, and cost-saving initiatives.
Elanco’s reaffirmation of its 2025 revenue and earnings guidance, along with the introduction of a new three-year outlook, suggests steady growth. However, while the projected revenue and EBITDA growth align with market expectations, the anticipated EPS growth slightly lags behind consensus estimates. Furthermore, the company’s ambitious goals for EBITDA margin expansion and cost savings through restructuring and innovation initiatives present potential risks if not effectively managed. These factors contribute to a cautious outlook, justifying the Hold rating.
In another report released on December 5, Piper Sandler also maintained a Hold rating on the stock with a $24.00 price target.