BofA raises Elanco share price target on solid core business By Investing.com

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BofA raises Elanco share price target on solid core business By Investing.com

On Thursday, BofA Securities adjusted its outlook on Elanco Animal Health (NYSE:) shares, increasing the price target to $20.00 from the previous $18.00, while reiterating a Buy rating on the stock. The upgrade reflects a positive view of the company’s recent performance and future prospects.

Elanco’s core business exceeded expectations, contributing to an upbeat quarterly update. This performance, along with robust second-quarter guidance, has led to a raised forecast by the analyst. The company’s 2024 product approval timelines have also been pushed out, but not as significantly as some had anticipated.

The revised price objective of $20.00 is now based on a 15 times multiple of BofA Securities’ forecasted FY24 enterprise value to EBITDA (EV/EBITDA), an increase from the previous 14 times multiple. This change is due to a heightened confidence in the company’s product approvals.

The firm’s reiteration of the Buy rating is based on Elanco’s improving core business, the anticipation of a new product cycle, and the expansion of the broader industry. These factors collectively suggest a favorable outlook for the company’s stock.

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