Healthy Upside Potential: Elanco Animal Health Incorporated (ELAN)

Elanco Animal Health Incorporated (NYSE: ELAN) stock fell -1.90% on Thursday to $8.24 against a previous-day closing price of $8.40. With 11.06 million shares changed hands, the volume of the stock remained heavier than its average volume of 7.72 million shares. During the session, the Drug Manufacturers – Specialty & Generic company that operates in wider Healthcare sector, reached to the highest price of $8.35 whereas the lowest price it dropped to was $7.90. The 52-week range on ELAN shows that it touched its highest point at $24.93 and its lowest point at $8.28 during that stretch. It currently has a 1-year price target of $13.21. Beta for the stock currently stands at 0.93.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of ELAN was down-trending over the past week, with a drop of -5.29%, but this was down by -10.92% over a month. Three-month performance dropped to -29.45% while six-month performance fell -33.66%. The stock lost -64.44% in the past year, while it has lost -32.57% so far this year. A look at the trailing 12-month EPS for ELAN yields -0.05 with Next year EPS estimates of 0.91. For the next quarter, that number is 0.05. This implies an EPS growth rate of 83.90% for this year and 13.52% for next year. EPS is expected to grow by 7.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 30.20%.

Float and Shares Shorts:

At present, 491.10 million ELAN shares are outstanding with a float of 472.91 million shares on hand for trading. On May 14, 2023, short shares totaled 7.85 million, which was 1.59% higher than short shares on Apr 13, 2023. In addition to Mr. Jeffrey N. Simmons as the firm’s Pres, CEO & Director, Mr. Todd S. Young serves as its Exec. VP & CFO.

Institutional Ownership:

Through their ownership of 100.29% of ELAN’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 61.05% of ELAN, in contrast to 55.99% held by mutual funds. Shares owned by individuals account for 43.76%. As the largest shareholder in ELAN with 17.25% of the stake, Dodge & Cox holds 84,774,075 shares worth 84,774,075. A second-largest stockholder of ELAN, The Vanguard Group, Inc., holds 45,263,531 shares, controlling over 9.21% of the firm’s shares. PRIMECAP Management Co. is the third largest shareholder in ELAN, holding 43,801,209 shares or 8.91% stake. With a 11.17% stake in ELAN, the Dodge & Cox Stock Fund is the largest stakeholder. A total of 54,903,300 shares are owned by the mutual fund manager. The Vanguard Total Stock Market ETF, which owns about 3.01% of ELAN stock, is the second-largest Mutual Fund holder. It holds 14,782,824 shares valued at 139.99 million. Vanguard PRIMECAP Fund holds 2.75% of the stake in ELAN, owning 13,507,019 shares worth 127.91 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Mar 30, 2023, ELAN reported revenue of $1.18B and operating income of $135.00M. The EBITDA in the recently reported quarter was $268.00M and diluted EPS was -$0.04.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for ELAN since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With ELAN analysts setting a high price target of $19.00 and a low target of $8.50, the average target price over the next 12 months is $13.19. Based on these targets, ELAN could surge 130.58% to reach the target high and rise by 3.16% to reach the target low. Reaching the average price target will result in a growth of 60.07% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded ELAN stock several times over the past three months with 25 Buys and 27 Sells. In these transactions, 1,293,087 shares were bought while 408,572 shares were sold. The number of buy transactions has increased to 42 while that of sell transactions has risen to 31 over the past year. The total number of shares bought during that period was 1,573,988 while 424,309 shares were sold.

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