ZOETIS INC (ZTS) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:ZTS • US98978V1035
124.82 USD
+3.1 (+2.55%)
At close: Jan 30, 2026
124.1 USD
-0.72 (-0.58%)
After Hours: 1/30/2026, 8:25:31 PM
Taking everything into account, ZTS scores 7 out of 10 in our fundamental rating. ZTS was compared to 190 industry peers in the Pharmaceuticals industry. ZTS gets an excellent profitability rating and is at the same time showing great financial health properties. ZTS is not valued too expensively and it also shows a decent growth rate. Finally ZTS also has an excellent dividend rating. This makes ZTS very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
- ZTS had positive earnings in the past year.
- ZTS had a positive operating cash flow in the past year.
- ZTS had positive earnings in each of the past 5 years.
- Each year in the past 5 years ZTS had a positive operating cash flow.
1.2 Ratios
- ZTS has a Return On Assets of 17.49%. This is amongst the best in the industry. ZTS outperforms 96.32% of its industry peers.
- ZTS has a Return On Equity of 49.11%. This is amongst the best in the industry. ZTS outperforms 97.89% of its industry peers.
- ZTS has a Return On Invested Capital of 21.45%. This is amongst the best in the industry. ZTS outperforms 96.84% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for ZTS is significantly above the industry average of 12.83%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.49% | ||
| ROE | 49.11% | ||
| ROIC | 21.45% |
ROA(3y)16.01%
ROA(5y)14.94%
ROE(3y)49.01%
ROE(5y)47.06%
ROIC(3y)21.64%
ROIC(5y)19.86%
1.3 Margins
- ZTS has a better Profit Margin (28.21%) than 93.68% of its industry peers.
- ZTS's Profit Margin has improved in the last couple of years.
- ZTS has a Operating Margin of 38.25%. This is amongst the best in the industry. ZTS outperforms 96.84% of its industry peers.
- In the last couple of years the Operating Margin of ZTS has grown nicely.
- Looking at the Gross Margin, with a value of 71.71%, ZTS is in the better half of the industry, outperforming 78.42% of the companies in the same industry.
- In the last couple of years the Gross Margin of ZTS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.25% | ||
| PM (TTM) | 28.21% | ||
| GM | 71.71% |
OM growth 3Y0.39%
OM growth 5Y2.44%
PM growth 3Y0.84%
PM growth 5Y2.31%
GM growth 3Y0.03%
GM growth 5Y0.65%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ZTS is creating value.
- ZTS has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for ZTS has been reduced compared to 5 years ago.
- ZTS has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 6.33 indicates that ZTS is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 6.33, ZTS is in the better half of the industry, outperforming 77.89% of the companies in the same industry.
- ZTS has a debt to FCF ratio of 3.16. This is a good value and a sign of high solvency as ZTS would need 3.16 years to pay back of all of its debts.
- ZTS has a Debt to FCF ratio of 3.16. This is amongst the best in the industry. ZTS outperforms 89.47% of its industry peers.
- ZTS has a Debt/Equity ratio of 1.31. This is a high value indicating a heavy dependency on external financing.
- ZTS has a Debt to Equity ratio of 1.31. This is in the lower half of the industry: ZTS underperforms 74.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 3.16 | ||
| Altman-Z | 6.33 |
ROIC/WACC2.33
WACC9.2%
2.3 Liquidity
- ZTS has a Current Ratio of 3.64. This indicates that ZTS is financially healthy and has no problem in meeting its short term obligations.
- With a Current ratio value of 3.64, ZTS perfoms like the industry average, outperforming 56.84% of the companies in the same industry.
- A Quick Ratio of 2.28 indicates that ZTS has no problem at all paying its short term obligations.
- ZTS has a Quick ratio of 2.28. This is comparable to the rest of the industry: ZTS outperforms 48.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.64 | ||
| Quick Ratio | 2.28 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 10.07% over the past year.
- The Earnings Per Share has been growing by 10.22% on average over the past years. This is quite good.
- ZTS shows a small growth in Revenue. In the last year, the Revenue has grown by 2.68%.
- ZTS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.14% yearly.
EPS 1Y (TTM)10.07%
EPS 3Y8%
EPS 5Y10.22%
EPS Q2Q%7.59%
Revenue 1Y (TTM)2.68%
Revenue growth 3Y5.98%
Revenue growth 5Y8.14%
Sales Q2Q%0.5%
3.2 Future
- ZTS is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.88% yearly.
- ZTS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.67% yearly.
EPS Next Y8.17%
EPS Next 2Y7.58%
EPS Next 3Y8.06%
EPS Next 5Y7.88%
Revenue Next Year2.07%
Revenue Next 2Y3.49%
Revenue Next 3Y4.21%
Revenue Next 5Y4.67%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- ZTS is valuated rather expensively with a Price/Earnings ratio of 19.69.
- ZTS's Price/Earnings ratio is rather cheap when compared to the industry. ZTS is cheaper than 82.11% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.30, ZTS is valued a bit cheaper.
- With a Price/Forward Earnings ratio of 18.22, ZTS is valued on the expensive side.
- Based on the Price/Forward Earnings ratio, ZTS is valued a bit cheaper than the industry average as 78.95% of the companies are valued more expensively.
- ZTS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.69 | ||
| Fwd PE | 18.22 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, ZTS is valued cheaply inside the industry as 82.63% of the companies are valued more expensively.
- 83.68% of the companies in the same industry are more expensive than ZTS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.56 | ||
| EV/EBITDA | 14.36 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ZTS does not grow enough to justify the current Price/Earnings ratio.
- ZTS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.41
PEG (5Y)1.93
EPS Next 2Y7.58%
EPS Next 3Y8.06%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.64%, ZTS has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.48, ZTS pays a better dividend. On top of this ZTS pays more dividend than 91.05% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, ZTS has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.64% |
5.2 History
- On average, the dividend of ZTS grows each year by 21.42%, which is quite nice.
- ZTS has been paying a dividend for at least 10 years, so it has a reliable track record.
- ZTS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)21.42%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
- 32.55% of the earnings are spent on dividend by ZTS. This is a low number and sustainable payout ratio.
- ZTS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP32.55%
EPS Next 2Y7.58%
EPS Next 3Y8.06%
ZOETIS INC / ZTS FAQ
What is the ChartMill fundamental rating of ZOETIS INC (ZTS) stock?
ChartMill assigns a fundamental rating of 7 / 10 to ZTS.
Can you provide the valuation status for ZOETIS INC?
ChartMill assigns a valuation rating of 6 / 10 to ZOETIS INC (ZTS). This can be considered as Fairly Valued.
How profitable is ZOETIS INC (ZTS) stock?
ZOETIS INC (ZTS) has a profitability rating of 9 / 10.
Can you provide the expected EPS growth for ZTS stock?
The Earnings per Share (EPS) of ZOETIS INC (ZTS) is expected to grow by 8.17% in the next year.
Is the dividend of ZOETIS INC sustainable?
The dividend rating of ZOETIS INC (ZTS) is 7 / 10 and the dividend payout ratio is 32.55%.