The Zoetis Inc. (NYSE:ZTS) First-Quarter Results Are Out And Analysts Have Published New Forecasts

Investors in Zoetis Inc. (NYSE:ZTS) had a good week, as its shares rose 5.5% to close at US$167 following the release of its first-quarter results. The result was positive overall - although revenues of US$2.2b were in line with what the analysts predicted, Zoetis surprised by delivering a statutory profit of US$1.31 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Zoetis

After the latest results, the 14 analysts covering Zoetis are now predicting revenues of US$9.15b in 2024. If met, this would reflect a satisfactory 4.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to increase 4.7% to US$5.48. Before this earnings report, the analysts had been forecasting revenues of US$9.17b and earnings per share (EPS) of US$5.48 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$214, showing that the business is executing well and in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Zoetis analyst has a price target of US$248 per share, while the most pessimistic values it at US$170. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Zoetis'historical trends, as the 6.4% annualised revenue growth to the end of 2024 is roughly in line with the 8.0% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 9.2% annually. So it's pretty clear that Zoetis is expected to grow slower than similar companies in the same industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$214, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Zoetis analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Zoetis .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.