Elanco initiated with a Market Perform at Leerink

Leerink analyst Daniel Clark initiated coverage of Elanco (ELAN) with a Market Perform rating and $14 price target The firm notes Elanco trades at the most attractive multiple in the animal health space and has several product launches that have the potential to change what has been a bumpy revenue trajectory. Despite an attractive setup, Leerink is cautious on the uptake of these new products, namely Zenrelia based on its proprietary MEDACorp survey work and conversations with key opinion leaders. Although the firm is modestly more positive on some of the company’s other newer product launches, at this point it cannot underwrite faster revenue growth, which would have caused it to be more positive on the name. Thus, despite an undemanding valuation and fairly low consensus growth expectations, Leerink remains on the sidelines.