NYSE:ZTS

Stock Analysis Report

Executive Summary

Zoetis Inc. discovers, develops, manufactures, and commercializes animal health medicines, vaccines, and diagnostic products in the United States and internationally.


Snowflake Analysis

Adequate balance sheet with acceptable track record.


Similar Companies

Share Price & News

How has Zoetis's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ZTS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.8%

ZTS

1.8%

US Pharmaceuticals

-3.8%

US Market


1 Year Return

12.1%

ZTS

-6.2%

US Pharmaceuticals

-15.9%

US Market

Return vs Industry: ZTS exceeded the US Pharmaceuticals industry which returned -6% over the past year.

Return vs Market: ZTS exceeded the US Market which returned -15.1% over the past year.


Shareholder returns

ZTSIndustryMarket
7 Day-1.8%1.8%-3.8%
30 Day-16.4%-7.3%-17.4%
90 Day-14.2%-11.1%-24.1%
1 Year12.8%12.1%-3.8%-6.2%-14.1%-15.9%
3 Year121.0%117.3%14.0%5.8%10.0%2.8%
5 Year153.8%145.6%14.4%1.8%27.6%13.5%

Price Volatility Vs. Market

How volatile is Zoetis's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Zoetis undervalued compared to its fair value and its price relative to the market?

36.53x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ZTS ($114.61) is trading above our estimate of fair value ($114.44)

Significantly Below Fair Value: ZTS is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ZTS is poor value based on its PE Ratio (36.5x) compared to the Pharmaceuticals industry average (19.8x).

PE vs Market: ZTS is poor value based on its PE Ratio (36.5x) compared to the US market (12.4x).


Price to Earnings Growth Ratio

PEG Ratio: ZTS is poor value based on its PEG Ratio (3.3x)


Price to Book Ratio

PB vs Industry: ZTS is overvalued based on its PB Ratio (20.1x) compared to the US Pharmaceuticals industry average (2.3x).


Next Steps

Future Growth

How is Zoetis forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

11.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ZTS's forecast earnings growth (11% per year) is above the savings rate (1.7%).

Earnings vs Market: ZTS's earnings (11% per year) are forecast to grow slower than the US market (13.4% per year).

High Growth Earnings: ZTS's earnings are forecast to grow, but not significantly.

Revenue vs Market: ZTS's revenue (5.9% per year) is forecast to grow slower than the US market (7.1% per year).

High Growth Revenue: ZTS's revenue (5.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ZTS's Return on Equity is forecast to be very high in 3 years time (46.7%).


Next Steps

Past Performance

How has Zoetis performed over the past 5 years?

25.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ZTS has high quality earnings.

Growing Profit Margin: ZTS's current net profit margins (24%) are lower than last year (24.5%).


Past Earnings Growth Analysis

Earnings Trend: ZTS's earnings have grown significantly by 25.8% per year over the past 5 years.

Accelerating Growth: ZTS's earnings growth over the past year (5%) is below its 5-year average (25.8% per year).

Earnings vs Industry: ZTS earnings growth over the past year (5%) exceeded the Pharmaceuticals industry -0.2%.


Return on Equity

High ROE: Whilst ZTS's Return on Equity (55.39%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Zoetis's financial position?


Financial Position Analysis

Short Term Liabilities: ZTS's short term assets ($4.7B) exceed its short term liabilities ($1.8B).

Long Term Liabilities: ZTS's short term assets ($4.7B) do not cover its long term liabilities ($7.0B).


Debt to Equity History and Analysis

Debt Level: ZTS's debt to equity ratio (238.3%) is considered high.

Reducing Debt: ZTS's debt to equity ratio has reduced from 271.7% to 238.3% over the past 5 years.

Debt Coverage: ZTS's debt is well covered by operating cash flow (27.8%).

Interest Coverage: ZTS's interest payments on its debt are well covered by EBIT (11.8x coverage).


Balance Sheet

Inventory Level: ZTS has a high level of physical assets or inventory.

Debt Coverage by Assets: ZTS's debt is not covered by short term assets (assets are 0.7x debt).


Next Steps

Dividend

What is Zoetis's current dividend yield, its reliability and sustainability?

0.70%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: ZTS's dividend (0.7%) isn’t notable compared to the bottom 25% of dividend payers in the US market (2.05%).

High Dividend: ZTS's dividend (0.7%) is low compared to the top 25% of dividend payers in the US market (5.71%).


Stability and Growth of Payments

Stable Dividend: ZTS is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: ZTS is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: ZTS is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ZTS's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.7yrs

Average management tenure


CEO

Kristin Peck (48yo)

0.25

Tenure

US$3,038,924

Compensation

Ms. Kristin C. Peck serves as Chief Executive Officer of Zoetis Inc. since January 2020 and serves as its Director since October 3, 2019. Ms. Peck served as Group President of U.S. Operations, Business Dev ...


CEO Compensation Analysis

Compensation vs Market: Kristin's total compensation ($USD3.04M) is below average for companies of similar size in the US market ($USD11.95M).

Compensation vs Earnings: Kristin's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Kristin Peck
CEO & Director0.25yrUS$3.04m0.0086% $4.7m
Glenn David
Executive VP & CFO3.67yrsUS$3.04m0.0059% $3.2m
Juan Alaix
Advisor & Director7.75yrsUS$11.67m0.020% $11.0m
Catherine Knupp
Executive VP and President of Research & Development7.42yrsUS$2.92m0.014% $7.4m
Roxanne Lagano
Executive VP and Chief Human Resources Officer & Global Operationsno datano data0.0075% $4.1m
Wafaa Mamilli
Executive VP and Chief Information & Digital Officer0.25yrno datano data
Steven Frank
Vice President of Investor Relationsno datano datano data
Heidi Chen
Executive VP7.5yrsno data0.0034% $1.9m
William Price
VP & Chief Communications Officerno datano datano data
Roman Trawicki
Executive VP and President of Global Manufacturing & Supply4.92yrsno data0.00090% $489.9k

3.7yrs

Average Tenure

53yo

Average Age

Experienced Management: ZTS's management team is considered experienced (3.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kristin Peck
CEO & Director0.25yrUS$3.04m0.0086% $4.7m
Juan Alaix
Advisor & Director7.75yrsUS$11.67m0.020% $11.0m
Louise Parent
Independent Director6.67yrsUS$300.00k0.0016% $854.6k
Michael McCallister
Non-Executive Chairman6.83yrsUS$475.00k0.0039% $2.1m
William Steere
Independent Director7.25yrsUS$300.00k0.0034% $1.9m
Frank D'Amelio
Independent Director7.75yrsUS$300.00k0.0027% $1.5m
Sanjay Khosla
Independent Director6.83yrsUS$300.00k0.0017% $909.0k
Robert Scully
Independent Director6.83yrsUS$325.00k0.0019% $1.0m
Gregory Norden
Independent Director7.25yrsUS$325.00k0.0025% $1.3m
Willie Reed
Independent Director6.08yrsUS$300.00k0.0014% $745.7k

6.8yrs

Average Tenure

67.5yo

Average Age

Experienced Board: ZTS's board of directors are considered experienced (6.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Zoetis Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Zoetis Inc.
  • Ticker: ZTS
  • Exchange: NYSE
  • Founded: 1952
  • Industry: Pharmaceuticals
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: US$54.432b
  • Shares outstanding: 474.93m
  • Website: https://www.zoetis.com

Number of Employees


Location

  • Zoetis Inc.
  • 10 Sylvan Way
  • Parsippany
  • New Jersey
  • 7054
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ZTSNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 2013
ZOEDB (Deutsche Boerse AG)YesCommon StockDEEURFeb 2013
0M3QLSE (London Stock Exchange)YesCommon StockGBUSDFeb 2013
ZTS *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNFeb 2013
ZOEBRSE (Berne Stock Exchange)YesCommon StockCHCHFFeb 2013
ZOEETLX (Eurotlx)YesCommon StockITEURFeb 2013
ZOTSWBAG (Wiener Boerse AG)YesCommon StockATEURFeb 2013
Z1TS34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 4 REPR 1 COMBRBRLJan 2020

Biography

Zoetis Inc. discovers, develops, manufactures, and commercializes animal health medicines, vaccines, and diagnostic products in the United States and internationally. It commercializes products primarily across species, including livestock, such as cattle, swine, poultry, fish, and sheep; and companion animals comprising dogs, cats, and horses. The company offers vaccines, which are biological preparations to prevent diseases of the respiratory, gastrointestinal, and reproductive tracts or induce a specific immune response; anti-infectives that prevent, kill, or slow the growth of bacteria, fungi, or protozoa; and parasiticides, which prevent or eliminate external and internal parasites comprising fleas, ticks, and worms. It also provides other pharmaceutical products comprising pain and sedation, antiemetic, reproductive, and oncology products; dermatology products for itch associated with allergic conditions and atopic dermatitis; and medicated feed additives that offer medicines to livestock. In addition, the company offers portable blood and urine analysis systems, and point-of-care diagnostic products, including instruments and reagents, rapid immunoassay tests, reference laboratory kits, and blood glucose monitors; and other non-pharmaceutical products, such as nutritionals and agribusiness, as well as products and services in the areas of biodevices, genetics tests, and precision livestock farming. It markets its products to veterinarians, livestock producers, and retail outlets, as well as third-party veterinary distributors through its sales representatives, and technical and veterinary operations specialists. The company was founded in 1952 and is headquartered in Parsippany, New Jersey. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/06 02:44
End of Day Share Price2020/04/03 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.