Zoetis Inc.

NYSE:ZTS Stock Report

Market Cap: US$79.2b

Zoetis Valuation

Is ZTS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of ZTS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: ZTS ($175.67) is trading below our estimate of fair value ($247.09)

Significantly Below Fair Value: ZTS is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for ZTS?

Key metric: As ZTS is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for ZTS. This is calculated by dividing ZTS's market cap by their current earnings.
What is ZTS's PE Ratio?
PE Ratio32.6x
EarningsUS$2.43b
Market CapUS$79.21b

Price to Earnings Ratio vs Peers

How does ZTS's PE Ratio compare to its peers?

The above table shows the PE ratio for ZTS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average22.1x
PFE Pfizer
33.1x16.8%US$142.2b
MRK Merck
20.3x15.6%US$244.2b
JNJ Johnson & Johnson
25x10.6%US$368.4b
RPRX Royalty Pharma
10.2x6.3%US$15.3b
ZTS Zoetis
32.6x9.9%US$79.2b

Price-To-Earnings vs Peers: ZTS is expensive based on its Price-To-Earnings Ratio (32.6x) compared to the peer average (22.1x).

Price to Earnings Ratio vs Industry

How does ZTS's PE Ratio compare vs other companies in the US Pharmaceuticals Industry?

12 CompaniesPrice / EarningsEstimated GrowthMarket Cap
OGN Organon
2.9x-7.1%US$3.76b
NDOI Endo
0.6xn/aUS$1.91b
PROC Procaps Group
1.2xn/aUS$59.68m
KPRX Kiora Pharmaceuticals
1.8x-40.4%US$9.59m
ZTS 32.6xIndustry Avg. 20.1xNo. of Companies12PE01224364860+
12 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: ZTS is expensive based on its Price-To-Earnings Ratio (32.6x) compared to the US Pharmaceuticals industry average (20.1x).

Price to Earnings Ratio vs Fair Ratio

What is ZTS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

ZTS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio32.6x
Fair PE Ratio30.9x

Price-To-Earnings vs Fair Ratio: ZTS is expensive based on its Price-To-Earnings Ratio (32.6x) compared to the estimated Fair Price-To-Earnings Ratio (30.9x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst ZTS forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$175.67
US$214.78
+22.3%
9.5%US$248.00US$172.12n/a15
Nov ’25US$181.95
US$214.78
+18.0%
10.0%US$248.00US$170.00n/a15
Oct ’25US$194.42
US$213.12
+9.6%
10.2%US$248.00US$170.00n/a15
Sep ’25US$183.49
US$215.54
+17.5%
9.2%US$248.00US$170.00n/a15
Aug ’25US$182.42
US$211.07
+15.7%
9.9%US$248.00US$170.00n/a15
Jul ’25US$172.58
US$209.47
+21.4%
10.0%US$248.00US$170.00n/a15
Jun ’25US$169.56
US$210.46
+24.1%
10.4%US$248.00US$170.00n/a15
May ’25US$158.50
US$213.93
+35.0%
10.2%US$248.00US$170.00n/a16
Apr ’25US$167.02
US$220.68
+32.1%
9.4%US$260.00US$170.00n/a16
Mar ’25US$190.82
US$221.93
+16.3%
8.9%US$260.00US$170.00n/a16
Feb ’25US$189.14
US$220.97
+16.8%
9.1%US$255.00US$170.00n/a16
Jan ’25US$197.37
US$214.90
+8.9%
10.6%US$255.00US$170.00n/a15
Dec ’24US$179.13
US$212.39
+18.6%
10.5%US$255.00US$170.00n/a14
Nov ’24US$151.44
US$217.10
+43.4%
10.8%US$260.00US$170.00US$181.9515
Oct ’24US$173.98
US$218.77
+25.7%
10.3%US$260.00US$170.00US$194.4215
Sep ’24US$192.52
US$216.23
+12.3%
11.4%US$260.00US$170.00US$183.4913
Aug ’24US$185.51
US$213.23
+14.9%
12.0%US$260.00US$170.00US$182.4213
Jul ’24US$172.21
US$213.50
+24.0%
12.7%US$260.00US$170.00US$172.5812
Jun ’24US$166.00
US$214.25
+29.1%
12.4%US$260.00US$170.00US$169.5612
May ’24US$179.56
US$214.08
+19.2%
12.5%US$260.00US$170.00US$158.5012
Apr ’24US$166.44
US$214.92
+29.1%
12.3%US$260.00US$170.00US$167.0212
Mar ’24US$167.57
US$214.92
+28.3%
12.3%US$260.00US$170.00US$190.8212
Feb ’24US$167.81
US$209.70
+25.0%
13.2%US$250.00US$170.00US$189.1412
Jan ’24US$146.55
US$208.91
+42.6%
14.4%US$250.00US$170.00US$197.3711
Dec ’23US$156.64
US$208.91
+33.4%
14.4%US$250.00US$170.00US$179.1311
Nov ’23US$152.72
US$223.36
+46.3%
10.0%US$264.00US$186.00US$151.4411

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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