Elanco Animal Health Inc (ELAN) stock analysis
Close on Nov 12, 2026Market cap $13.24BP/E –Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Mixed9 of 30 checks passed
Elanco Animal Health passes 9 of the 30 checks behind our score; 12 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 1/6
- Growth
- 3/6
- Past performance
- 3/6
- Financial health
- 2/6
- Dividend
- 0/6
What stands out
Guidance raised
Elanco Animal Health raised its 2026 Full Year Revenue outlook on Aug 5, 2026.
P/B below the industry
Elanco Animal Health's price-to-book of 2.00 is below the Drugs median of 2.29.
Growing faster than the industry
Revenue grew 12.1% over the last twelve months; the Drugs median is 8.0%.
Gross margin improving
Gross margin was 56.2% over the last twelve months, against 55.0% a year earlier.
What to watch
Margin of safety under 20%
The price is 108% above fair value, so there is no margin of safety.
Trading above fair value
The share price of $26.48 is above our fair value estimate of $12.74.
Return on equity under 15%
Return on equity was -2.2% over the last twelve months and averaged -4.7% over five years; we look for 15% on both.
High debt
Debt is 55.9% of shareholders' equity, above the 40% we consider low.
Valuation1/6
P/E against its history
Not enough price and earnings history to compare.
P/E against the industry
Needs positive earnings and enough profitable companies in the industry.
EV/EBITDA above its 5-year median
Elanco Animal Health's EV/EBITDA of 27.4 is above its 5-year median of 15.2.
P/B below the industry
Elanco Animal Health's price-to-book of 2.00 is below the Drugs median of 2.29.
Trading above fair value
The share price of $26.48 is above our fair value estimate of $12.74.
Margin of safety under 20%
The price is 108% above fair value, so there is no margin of safety.
Growth3/6
Revenue growing under 10% a year
Revenue grew 2.2% a year over the last three fiscal years, short of the 10% we look for.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growing faster than the industry
Revenue grew 12.1% over the last twelve months; the Drugs median is 8.0%.
Guidance raised
Elanco Animal Health raised its 2026 Full Year Revenue outlook on Aug 5, 2026.
Gross margin improving
Gross margin was 56.2% over the last twelve months, against 55.0% a year earlier.
Past performance3/6
Return on equity under 15%
Return on equity was -2.2% over the last twelve months and averaged -4.7% over five years; we look for 15% on both.
Return on invested capital
Needs operating income and invested capital.
Return on equity above the industry
Elanco Animal Health's return on equity of -2.2% is above the Drugs median of -58.9%.
Earnings over 5 years
Needs positive net income five years ago and in the latest year.
Net margin above its 5-year average
Net margin was -2.9% over the last twelve months, against a 5-year average of -7.4%.
Net margin above the industry
Elanco Animal Health's net margin of -2.9% is above the Drugs median of -53.0%.
Financial health2/6
High debt
Debt is 55.9% of shareholders' equity, above the 40% we consider low.
Debt falling against equity
Debt to equity fell from 72.4% five years ago to 55.9%.
Debt not well covered by cash flow
Operating cash flow over the last twelve months equals 16.6% of total debt; we look for at least 20%.
Interest coverage
Interest expense is not reported separately.
Short-term assets cover short-term debts
Current assets are 2.09 times current liabilities.
Elevated bankruptcy risk
The Altman Z-score is 1.53; above 3 is the safe zone and below 1.8 the distress zone.
Dividend0/6
No dividend
Elanco Animal Health has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$12.74
The share price is 108% above this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| EV/EBITDA | 16.2× | 15.2× | 17.1× | $12.98 | 58% |
| P/B | 1.7× | 1.2× | 2.3× | $23.11 | 17% |
| Earnings power | 10.3% cost of equity | – | – | $5.26 | 25% |
| Fair value | $12.74 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/E at month end
- Drugs median 25.1
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Low risk
- Average value traded per day
- $126.05M
- Value traded per 1% price move
- $76.49M
Downside
Low risk
- Typical loss in a bad month
- 12.9%
- Volatility (annualized)
- 43%
- Sharpe ratio, 1 year
- 0.33
- Beta to the S&P 500 (5Y)
- 1.07
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2015 to 2025
Gross margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +6.2% | +2.2% | +7.6% | – | |
| Gross profit | +6.4% | +1.3% | +10.1% | – | |
| Free cash flow | -27.9% | +0.4% | – | – |
Returns and balance sheet
10 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2016 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | -0.7% | -8.2% | -3.7% | |
| Return on assets | – | -4.3% | -1.8% | |
| Current ratio | – | 1.65 | 2.17 | |
| Debt to equity | – | 0.72 | 0.61 | |
| Inventory turnover | – | 1.3× | 1.3× | |
| Capex to revenue | 3.8% | 4.1% | 5.9% | |
| Diluted shares | 293M | 441M | 496M |
Where the cash went
Fiscal 2021 to 2025, five years combined
Elanco Animal Health generated $2.31B from operations and spent $893.00M on capital expenditure, dividends and share buybacks. 100% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | -4.9% | 0.36× | 2.05× | -3.7% |
| FY2024 | 7.6% | 0.33× | 2.19× | 5.5% |
| FY2023 | -27.9% | 0.30× | 2.21× | -18.2% |
| FY2022 | -1.8% | 0.28× | 2.16× | -1.1% |
| FY2021 | -10.1% | 0.28× | 2.14× | -6.1% |
| FY2020 | -17.5% | 0.25× | 1.91× | -8.2% |
| FY2019 | 2.2% | 0.34× | 1.67× | 1.3% |
| FY2018 | 2.8% | 0.34× | 1.38× | 1.3% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero-$232.00M
- Cash generatingOperating cash flow above zero$560.00M
- Return on assets improvedROA up on the prior year2.4% → -1.8%
- Earnings backed by cashOperating cash flow above net income$560.00M vs -$232.00M
- Less leverageLong-term debt to assets fell33.9% → 29.5%
- Better liquidityCurrent ratio rose2.44 → 2.17
- No dilutionShare count did not rise497M → 496M
- Gross margin improvedGross margin up on the prior year54.88% → 54.99%
- More efficientAsset turnover rose0.31 → 0.37
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