12 Stocks That Are About to Explode

4. Elanco Animal Health Incorporated (NYSE:ELAN)

Number of Hedge Fund Holders: 37

Analysts’ Upside Potential as of March 27: 43.6%

Elanco Animal Health Incorporated (NYSE:ELAN) is a global animal health company engaged in developing, manufacturing, and marketing pharmaceutical products and vaccines for companion animals (dogs and cats) and farm animals (cattle, poultry, swine, and fish). The company’s portfolio includes products focused on disease prevention, therapeutic treatments, parasite control, nutritional health, and animal productivity enhancement. ELAN serves veterinarians, farmers, livestock producers, and pet owners worldwide, operating across key geographic markets, including North America, Europe, Asia-Pacific, and Latin America. With an upside potential of over 43%, ELAN is one of the stocks that are about to explode.

Elanco Animal Health Incorporated (NYSE:ELAN) has delivered impressive results, marking six quarters of consecutive growth and achieving a notable 3% increase in constant currency sales for 2024. Looking ahead, the company anticipates an even stronger performance, forecasting organic growth of 4-6% in constant currency sales for 2025. Central to this optimistic outlook is ELAN’s robust innovation portfolio, featuring six promising blockbuster products that are now projected to generate between $640 million and $720 million in revenue during 2025. Particularly notable is Experior, a standout in the farm animal segment, which has reached blockbuster status in the US. This accomplishment reinforces the company’s dominant market position, where it currently holds leading rankings in the US across beef, poultry, and swine segments.

In the pet health division, Elanco Animal Health Incorporated (NYSE:ELAN) is also accelerating growth with the launch of two significant new products. Credelio Quattro, introduced in January 2025, distinguishes itself by offering more comprehensive protection and faster tick elimination compared to its competitors. Concurrently, Zenrelia, the company’s JAK inhibitor designed to treat atopic dermatitis, has demonstrated strong efficacy and already achieved approximately 30% penetration across roughly 8,000 veterinary clinics in the US.

Despite these positive developments, Elanco Animal Health Incorporated (NYSE:ELAN) faces challenges such as considerable foreign exchange headwinds, which negatively affected both revenue and EBITDA during the fourth quarter of 2024. Furthermore, strategic decisions like the sale of the Aqua business to Merck and significant investments supporting new product launches have created uneven EBITDA distribution, shifting profitability toward the latter half of 2025. However, at least 2 insiders bought more than $100,000 worth of shares in 2025, which potentially suggests that the peak headwinds are in the rear-view mirror.