Recovery of Elan nothing new

ELAN’S change in fortunes has been underpinned by a number of reports from analysts.

But its return to favour is not new.

By the end of 2003 it had recovered to $6.91 per share and defied the expectations of many who thought the company had run out of time.

Goodbody Stockbrokers is among the growing list of fans behind the share. Recently tipped to hit $45 Goodbody's Ian Hunter is a bit more phlegmatic about the stock, though positive it will go above $31.

Previously it put the prospects for the stock at $27.50.

Mr Hunter says that the group is beginning to return to prosperity having eliminated the high financial risks that caused its share price to plunge in 2002.

In Dublin shares were trading at 20.69 or $25.68 still well off the highs they reached before its accounting and other practices were called into question by the Wall Street Journal.

In June 2002 the group's shares hit a high of €69.90 or $87 before the assault on the company's financial probity by the newspaper.

Davy Stockbrokers also sees the group in solid recovery mode and those who bought in when the share price was on its knees have done extremely well.

In his assessment of the other publicly-quoted pharmaceutical stocks Mr Hunter tips Warner Chilcott as the other share buy. Out of favour are Icon and Trinity Biotech.

Investors should reduce their exposure to those players on the grounds of less buoyant earnings opportunities in the period ahead and the less positive environment in general towards the sector.