| Valuation method | Value, € | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | n/a |
| Intrinsic value (DCF) | n/a | |
| Graham-Dodd Method | 5.90 | -71 |
| Graham Formula | 5.00 | -75 |
Elanco Animal Health Inc. (5EA.DE) is a leading global animal health company specializing in innovative solutions for companion and food animals. Headquartered in Greenfield, Indiana, Elanco operates in the pharmaceutical sector of the healthcare industry, focusing on disease prevention, therapeutics, and health management for pets and livestock. The company’s product portfolio spans four key categories: Companion Animal Disease Prevention, Companion Animal Therapeutics, Food Animal Future Protein & Health, and Food Animal Ruminants & Swine. Elanco is known for its parasiticide products that protect pets from worms, fleas, and ticks, as well as treatments for pain, osteoarthritis, otitis, and dermatological conditions. In the food animal segment, it provides vaccines, nutritional enzymes, and antibiotics to enhance livestock health and productivity. With a strong presence in both companion and food animal markets, Elanco plays a critical role in supporting pet owners, veterinarians, and farmers worldwide. The company’s commitment to innovation and sustainability positions it as a key player in the rapidly evolving animal health industry.
Elanco Animal Health presents a compelling investment opportunity due to its diversified product portfolio and strong market position in the animal health sector. The company reported revenue of €4.44 billion and net income of €338 million in the latest fiscal year, with diluted EPS of €0.68. Operating cash flow stood at €541 million, indicating healthy liquidity, though total debt of €4.44 billion warrants caution. Elanco’s focus on companion and food animal health provides resilience against economic downturns, as pet care spending remains stable and demand for livestock products grows. However, high debt levels and capital expenditures of €147 million could pressure margins. Investors should weigh the company’s innovation pipeline against competitive pressures and regulatory risks in the pharmaceutical industry.
Elanco Animal Health competes in a highly consolidated global animal health market dominated by a few major players. The company’s competitive advantage lies in its broad product portfolio, which spans both companion and food animal segments, providing diversification. Elanco’s strong parasiticide and pain management offerings in the companion animal space differentiate it from competitors, while its food animal solutions cater to the growing demand for protein production. However, the company faces intense competition from larger rivals like Zoetis and Merck Animal Health, which have greater R&D budgets and global reach. Elanco’s debt burden could also limit its ability to invest in innovation compared to peers. On the positive side, strategic acquisitions and partnerships have expanded its market presence, particularly in emerging markets. The company’s focus on sustainability and antibiotic stewardship aligns with industry trends, potentially enhancing its long-term positioning. Nevertheless, pricing pressures and regulatory hurdles in key markets remain challenges.