WallStSmart

Elanco Animal Health (ELAN)vsJohnson & Johnson (JNJ)

VS

Smart Verdict

WallStSmart Research — data-driven comparison

Johnson & Johnson generates 1944% more annual revenue ($96.36B vs $4.71B). JNJ leads profitability with a 21.8% profit margin vs -4.9%. JNJ appears more attractively valued with a PEG of 2.96. JNJ earns a higher WallStSmart Score of 59/100 (C).

ELAN

Buy

51

out of 100

Grade: C-

Growth: 6.7Profit: 3.0Value: 5.0Quality: 5.3
Piotroski: 4/9Altman Z: 0.90

JNJ

Buy

59

out of 100

Grade: C

Growth: 4.7Profit: 9.0Value: 3.3Quality: 6.0
Piotroski: 4/9Altman Z: 2.64
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

ELANUndervalued (+17.2%)

Margin of Safety

+17.2%

Fair Value

$31.06

Current Price

$21.80

$9.26 discount

UndervaluedFair: $31.06Overvalued
JNJSignificantly Overvalued (-43.5%)

Margin of Safety

-43.5%

Fair Value

$160.13

Current Price

$229.85

$69.72 premium

UndervaluedFair: $160.13Overvalued

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

ELAN2 strengths · Avg: 9.0/10
EPS GrowthGrowth
116.7%10/10

Earnings expanding 116.7% YoY

Price/BookValuation
1.7x8/10

Reasonable price relative to book value

JNJ5 strengths · Avg: 8.8/10
Market CapQuality
$547.28B10/10

Mega-cap, among the largest globally

Return on EquityProfitability
26.4%9/10

Every $100 of equity generates 26 in profit

Profit MarginProfitability
21.8%9/10

Keeps 22 of every $100 in revenue as profit

Operating MarginProfitability
27.4%8/10

Strong operational efficiency at 27.4%

Free Cash FlowQuality
$1.47B8/10

Generating 1.5B in free cash flow

Areas to Watch

ELAN4 concerns · Avg: 2.3/10
Operating MarginProfitability
2.3%3/10

Operating margin of 2.3%

PEG RatioValuation
3.732/10

Expensive relative to growth rate

Return on EquityProfitability
-3.7%2/10

ROE of -3.7% — below average capital efficiency

Altman Z-ScoreHealth
0.902/10

Distress zone — elevated risk

JNJ3 concerns · Avg: 2.7/10
P/E RatioValuation
26.3x4/10

Moderate valuation

PEG RatioValuation
2.962/10

Expensive relative to growth rate

EPS GrowthGrowth
-52.9%2/10

Earnings declined 52.9%

Comparative Analysis Report

WallStSmart Research

Bull Case : ELAN

The strongest argument for ELAN centers on EPS Growth, Price/Book. Revenue growth of 12.2% demonstrates continued momentum.

Bull Case : JNJ

The strongest argument for JNJ centers on Market Cap, Return on Equity, Profit Margin. Profitability is solid with margins at 21.8% and operating margin at 27.4%.

Bear Case : ELAN

The primary concerns for ELAN are Operating Margin, PEG Ratio, Return on Equity.

Bear Case : JNJ

The primary concerns for JNJ are P/E Ratio, PEG Ratio, EPS Growth.

Key Dynamics to Monitor

ELAN profiles as a turnaround stock while JNJ is a mature play — different risk/reward profiles.

ELAN carries more volatility with a beta of 1.88 — expect wider price swings.

ELAN is growing revenue faster at 12.2% — sustainability is the question.

JNJ generates stronger free cash flow (1.5B), providing more financial flexibility.

Bottom Line

JNJ scores higher overall (59/100 vs 51/100), backed by strong 21.8% margins. ELAN offers better value entry with a 17.2% margin of safety. Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

Elanco Animal Health

HEALTHCARE · DRUG MANUFACTURERS - SPECIALTY & GENERIC · USA

Elanco Animal Health Incorporated, an animal health company, innovates, develops, manufactures and markets products for pets and farm animals. The company is headquartered in Greenfield, Indiana.

Johnson & Johnson

HEALTHCARE · DRUG MANUFACTURERS - GENERAL · USA

Johnson & Johnson (J&J) is an American multinational corporation founded in 1886 that develops medical devices, pharmaceuticals, and consumer packaged goods. Its common stock is a component of the Dow Jones Industrial Average and the company is ranked No. 36 on the 2021 Fortune 500 list of the largest United States corporations by total revenue. Johnson & Johnson is one of the world's most valuable companies, and is one of only two U.S.-based companies that has a prime credit rating of AAA, higher than that of the United States government.

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