Is Elanco Animal Health, Inc. overvalued or undervalued?

As of 17 October 2025, Elanco Animal Health, Inc. has moved from a very attractive valuation grade to expensive. The company appears to be overvalued based on its current metrics. Key ratios include a P/E ratio of 14, an EV to EBITDA of 12.07, and a Price to Book Value of 1.09. In comparison to peers, Elanco's P/E ratio of 19.25 is higher than BioMarin Pharmaceutical, Inc., which has a P/E of 15.17, indicating that Elanco is trading at a premium relative to some of its competitors.
Despite strong short-term returns, with a year-to-date return of 76.88% compared to the S&P 500's 13.30%, the long-term performance has been lackluster, with a 5-year return of -32.09% versus the S&P 500's 91.29%. This disparity suggests that while recent performance may seem promising, the overall valuation does not support continued growth at the current price levels.