Elan Corp. (NYSE: ELN) is a neuroscience-based technology company focused on discovering, developing, manufacturing and marketing advanced therapies in neurology, autoimmune diseases and severe pain.
Analysts sees 33-40% revenue growth for Elan in 2008 after likely 30-35% growth in 2007.
Analysts also like Elan's ramping sales for drug Tysabri for multiple sclerosis and Crohn's disease; they are also hopeful about the company's Alzheimer drug, bapineuzmab, currently in trials.
Meanwhile, margins will remain strong in 2008, but may narrow somewhat from 2007's 56%. The Reuters F2007/F2008 EPS consensus estimates for ELN are -$0.67 / -$0.28.
The risks? Reduced demand or renewed safety concerns for Tysabri would (obviously) hurt ELN's results.
The First Call mean rating for ELN is: Hold. [22 firms.] Mean 2008 target: $22.00. [high: $31, low: $12.]
Stock Analysis: Elan is a high-risk stock not suitable for moderate-risk or low-risk investors. Investors with an investment horizon longer than three years should be rewarded from ELN's shares. Sell / Stop Loss if you were to purchase shares in this company: $16.
Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.
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