Elanco Animal Health (ELAN)
NYSE:ELAN
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Elanco Animal Health
(NYSE:ELAN)
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Rating:58Neutral
Price Target:
$26.00
▲(8.97% Upside)
Action:ReiteratedDate:03/18/26
The score is driven primarily by stable cash generation and improving leverage trends, supported by a constructive 2026 outlook from management. Offsetting factors are inconsistent GAAP profitability (negative P/E) and weak near-term technical momentum (negative MACD, sub-50 RSI).
Positive Factors
Innovation Revenue Growth
A clear increase and upward guidance for innovation revenue signals durable portfolio innovation and successful commercialization of higher‑value products. Sustained innovation revenue growth supports margin expansion, higher-quality revenue mix, and long-term organic growth independent of cyclical end markets.
Negative Factors
Profitability Volatility
Swinging GAAP profitability and inconsistent ROE indicate earnings quality risk. Profit volatility can constrain reinvestment, increase capital costs, and weaken ability to consistently generate shareholder returns, making long‑term planning and valuation of pipeline outcomes more uncertain.
Read all positive and negative factors
Positive Factors
Negative Factors
Innovation Revenue Growth
A clear increase and upward guidance for innovation revenue signals durable portfolio innovation and successful commercialization of higher‑value products. Sustained innovation revenue growth supports margin expansion, higher-quality revenue mix, and long-term organic growth independent of cyclical end markets.
Read all positive factors
Elanco Animal Health (ELAN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.50B
Dividend YieldN/A
Average Volume (3M)5.15M
Price to Earnings (P/E)―
Beta (1Y)1.28
Revenue Growth3.08%
EPS Growth-82.39%
CountryUS
Employees9,000
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)0.13
Shares Outstanding497,168,100
10 Day Avg. Volume4,103,068
30 Day Avg. Volume5,147,703
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)1.72
Price to Sales (P/S)2.38
P/FCF Ratio39.55
Enterprise Value/Market Cap1.34
Enterprise Value/Revenue3.28
Enterprise Value/Gross Profit7.06
Enterprise Value/Ebitda21.41
Forecast
1Y Price Target
$29.40Price Target Upside23.22% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)1.03
Revenue Forecast (FY)$5.00B
Elanco Animal Health Business Overview & Revenue Model
Company Description
Elanco Animal Health Incorporated, an animal health company, innovates, develops, manufactures, and markets products for pets and farm animals. It offers pet health disease prevention products, such as parasiticide and vaccine products that protec...
How the Company Makes Money
Elanco makes money primarily by selling animal health products, generating revenue when its products are purchased through veterinary clinics, distributors, retailers, and livestock/agricultural channels. Its revenue model is centered on two main ...
Elanco Animal Health Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Positive
The call conveyed broad positive momentum: strong product launches (Credelio Quattro, ZENRELIA), meaningful innovation revenue growth, share gains across multiple categories, improved deleveraging, and raised innovation guidance for 2026. Headwinds include higher taxes impacting EPS, lower Q4 operating cash due to one‑time tax timing, inflation and inventory cost flow‑through pressuring near‑term gross margin, and manufacturing ramp constraints for mAb launches. Management provided upbeat 2026 guidance aligned with their long‑term algorithm and emphasized productivity initiatives to support margins.Positive Updates
Strong Q4 and Full-Year Organic Revenue Growth
Q4 2025 organic constant currency revenue growth of 9%; full-year 2025 organic constant currency revenue growth of 7%; reported Q4 revenue $1,140M (+12% YoY) and full-year reported revenue $4,715M (+6% YoY).
Negative Updates
Q4 Adjusted EPS Decline and Higher Tax Rate
Q4 adjusted EPS was $0.13, down 7% YoY; full-year effective tax rate increased to 21.8% (up ~370 basis points YoY), with higher tax timing impacting quarterly EPS.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Q4 and Full-Year Organic Revenue Growth
Q4 2025 organic constant currency revenue growth of 9%; full-year 2025 organic constant currency revenue growth of 7%; reported Q4 revenue $1,140M (+12% YoY) and full-year reported revenue $4,715M (+6% YoY).
Read all positive updates
Company Guidance
Elanco’s 2026 guidance calls for full‑year organic constant‑currency revenue growth of 4%–6% (revenue $4,950–$5,020M), adjusted EBITDA $955–$985M (≈+8% at the midpoint), and adjusted EPS $1.00–$1.06 (≈+10% at the midpoint); innovation revenue is raised to $1,150M (≥+$250M vs. 2025’s $892M), gross margin is expected to improve ~40 bps, OpEx to grow ~7%, and Elanco Ascend and restructuring are expected to deliver ~$25M of savings in 2026; Q1 guidance is organic cc growth 4%–6% (revenue $1,280–$1,305M), adjusted EBITDA $290–$310M (≈+9% at the midpoint) and adjusted EPS $0.33–$0.36; balance‑sheet targets include reducing net leverage from 3.6x at year‑end 2025 to 3.1–3.3x by year‑end 2026 (AHV acquisition not included in guidance; close expected in Q2 with modest 2026 contribution) and a long‑term leverage goal of 2.0–2.5x with a path to sub‑3x in 2027.Elanco Animal Health Financial Statement Overview
Summary
Income Statement
48
Neutral
Balance Sheet
56
Neutral
Cash Flow
62
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.71B | 4.44B | 4.42B | 4.41B | 4.76B |
| Gross Profit | 2.05B | 1.91B | 1.94B | 1.97B | 2.08B |
| EBITDA | 676.00M | 1.49B | -224.00M | 866.00M | 409.00M |
| Net Income | -232.00M | 338.00M | -1.23B | -78.00M | -483.00M |
Balance Sheet | |||||
| Total Assets | 13.36B | 12.61B | 14.36B | 15.49B | 16.48B |
| Cash, Cash Equivalents and Short-Term Investments | 545.00M | 468.00M | 352.00M | 345.00M | 638.00M |
| Total Debt | 4.02B | 4.32B | 5.77B | 5.84B | 6.32B |
| Total Liabilities | 6.81B | 6.52B | 8.14B | 8.20B | 8.97B |
| Stockholders Equity | 6.55B | 6.10B | 6.22B | 7.29B | 7.51B |
Cash Flow | |||||
| Free Cash Flow | 284.00M | 394.00M | 117.00M | 268.00M | 286.00M |
| Operating Cash Flow | 560.00M | 541.00M | 271.00M | 452.00M | 483.00M |
| Investing Cash Flow | -279.00M | 1.16B | -169.00M | -179.00M | -530.00M |
| Financing Cash Flow | -275.00M | -1.49B | -83.00M | -549.00M | 210.00M |
Elanco Animal Health Technical Analysis
Positive
23.86
Price Trends
24.42
Negative
23.63
Positive
20.92
Positive
Market Momentum
-0.30
Positive
50.04
Neutral
56.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ELAN, the sentiment is Positive. The current price of 23.86 is below the 20-day moving average (MA) of 23.92, below the 50-day MA of 24.42, and above the 200-day MA of 20.92, indicating a neutral trend. The MACD of -0.30 indicates Positive momentum. The RSI at 50.04 is Neutral, neither overbought nor oversold. The STOCH value of 56.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ELAN.
Elanco Animal Health Risk Analysis
Elanco Animal Health disclosed 46 risk factors in its most recent earnings report. Elanco Animal Health reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Elanco Animal Health Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $49.75B | 20.87 | 58.23% | 1.69% | 2.68% | 11.51% | |
74 Outperform | $2.35B | 13.79 | 30.81% | 1.28% | 33.71% | 289.48% | |
70 Outperform | $11.02B | 21.72 | 16.00% | 0.64% | 10.63% | 6.35% | |
61 Neutral | $36.74B | 25.43 | 20.09% | ― | -0.25% | ― | |
58 Neutral | $11.50B | -48.42 | -3.51% | ― | 3.08% | -82.39% | |
56 Neutral | $15.51B | -4.15 | -22.99% | 3.99% | -6.40% | -320.23% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
ELAN
Elanco Animal Health
23.86
15.62
189.56%
RDY
Dr Reddy's Laboratories
13.27
0.02
0.13%
VTRS
Viatris
13.83
6.68
93.53%
TEVA
Teva Pharmaceutical
31.15
17.55
129.04%
ZTS
Zoetis
120.08
-27.00
-18.36%
PAHC
Phibro Animal Health
59.58
42.99
259.15%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.