UBS Raises PT to $19 for Elanco Animal Health Amid Bullish Outlook

UBS Raises PT to $19 for Elanco Animal Health Amid Bullish Outlook

UBS has raised its price target for Elanco Animal Health (ELAN) to $19, reflecting a bullish outlook on the company's financial performance and growth prospects. This move comes on the heels of Elanco's strong second-quarter 2025 earnings report, which surpassed analysts' expectations.

Elanco reported an adjusted earnings per share (EPS) of $0.26, up from the forecasted $0.20, and revenue of $1.24 billion, exceeding the anticipated $1.18 billion [1]. The company's stock price surged by 15.66% in pre-market trading following the announcement, reaching $15.36 from a 52-week low of $8.02 [1].

Key drivers of Elanco's performance include a 5% year-over-year revenue increase, driven by strong performance in both pet and farm animal segments. The company also raised its innovation revenue target, signaling confidence in new product launches. Elanco's stock price increased by 15.66% in pre-market trading following the earnings announcement, indicating strong investor confidence in the company's financial health and future growth prospects [1].

UBS analysts highlighted Elanco's robust financial performance and strong market positioning as key factors behind the price target increase. The bank noted Elanco's ability to deliver consistent revenue growth, improve margins, and maintain a strong balance sheet. UBS also pointed to the company's focus on innovation and its leadership position in the pet health retail and farm animal segments as additional catalysts for growth [1].

Elanco's positive outlook for the remainder of 2025 includes a projected full-year organic constant currency growth of 5-6%, adjusted EBITDA of $850 million to $890 million, and adjusted EPS forecasted at $0.85-$0.91 [1]. The company expects upcoming product launches, including the Advantage collar and IL-31, to drive further growth.

Risks and challenges, such as supply chain disruptions, market saturation, and macroeconomic pressures, could impact Elanco's performance. However, the company's strong financial position and strategic initiatives position it well to navigate these challenges and continue its growth trajectory.

References:

[1] https://au.investing.com/news/transcripts/earnings-call-transcript-elanco-animal-health-beats-q2-2025-expectations-93CH-3966258