ZOETIS INC (ZTS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ZTS - US98978V1035 - Common Stock
120.98 USD
+2.32 (+1.96%)
121.25 USD
+0.27 (+0.22%)
Taking everything into account, ZTS scores 7 out of 10 in our fundamental rating. ZTS was compared to 191 industry peers in the Pharmaceuticals industry. Both the health and profitability get an excellent rating, making ZTS a very profitable company, without any liquidiy or solvency issues. ZTS has a decent growth rate and is not valued too expensively. These ratings would make ZTS suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year ZTS was profitable.
ZTS had a positive operating cash flow in the past year.
Each year in the past 5 years ZTS has been profitable.
ZTS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ZTS's Return On Assets of 17.49% is amongst the best of the industry. ZTS outperforms 96.34% of its industry peers.
Looking at the Return On Equity, with a value of 49.11%, ZTS belongs to the top of the industry, outperforming 97.91% of the companies in the same industry.
ZTS's Return On Invested Capital of 21.45% is amongst the best of the industry. ZTS outperforms 96.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ZTS is significantly above the industry average of 12.85%.
| 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
The Profit Margin of ZTS (28.21%) is better than 93.72% of its industry peers.
ZTS's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 38.25%, ZTS belongs to the top of the industry, outperforming 96.86% of the companies in the same industry.
ZTS's Operating Margin has improved in the last couple of years.
The Gross Margin of ZTS (71.71%) is better than 79.06% of its industry peers.
ZTS's Gross Margin has been stable in the last couple of years.
| 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.
The number of shares outstanding for ZTS has been reduced compared to 1 year ago.
ZTS has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ZTS has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.25 indicates that ZTS is not in any danger for bankruptcy at the moment.
ZTS's Altman-Z score of 6.25 is fine compared to the rest of the industry. ZTS outperforms 78.53% of its industry peers.
The Debt to FCF ratio of ZTS is 3.16, which is a good value as it means it would take ZTS, 3.16 years of fcf income to pay off all of its debts.
ZTS's Debt to FCF ratio of 3.16 is amongst the best of the industry. ZTS outperforms 89.01% of its industry peers.
A Debt/Equity ratio of 1.31 is on the high side and indicates that ZTS has dependencies on debt financing.
ZTS has a worse Debt to Equity ratio (1.31) than 75.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 3.16 | ||
| Altman-Z | 6.25 |
ROIC/WACC2.33
WACC9.22%
2.3 Liquidity
A Current Ratio of 3.64 indicates that ZTS has no problem at all paying its short term obligations.
ZTS's Current ratio of 3.64 is in line compared to the rest of the industry. ZTS outperforms 56.54% of its industry peers.
A Quick Ratio of 2.28 indicates that ZTS has no problem at all paying its short term obligations.
The Quick ratio of ZTS (2.28) is comparable to the rest of the industry.
| 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
Based on estimates for the next years, ZTS will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.09% on average per year.
Based on estimates for the next years, ZTS will show a small growth in Revenue. The Revenue will grow by 4.60% on average per year.
EPS Next Y8.23%
EPS Next 2Y7.52%
EPS Next 3Y8.09%
EPS Next 5Y8.09%
Revenue Next Year2.14%
Revenue Next 2Y3.63%
Revenue Next 3Y4.33%
Revenue Next 5Y4.6%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
ZTS is valuated rather expensively with a Price/Earnings ratio of 19.08.
Compared to the rest of the industry, the Price/Earnings ratio of ZTS indicates a rather cheap valuation: ZTS is cheaper than 82.20% of the companies listed in the same industry.
ZTS is valuated rather cheaply when we compare the Price/Earnings ratio to 26.55, which is the current average of the S&P500 Index.
ZTS is valuated rather expensively with a Price/Forward Earnings ratio of 17.68.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ZTS indicates a somewhat cheap valuation: ZTS is cheaper than 78.01% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of ZTS to the average of the S&P500 Index (23.78), we can say ZTS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.08 | ||
| Fwd PE | 17.68 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ZTS is valued cheaper than 82.72% of the companies in the same industry.
ZTS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ZTS is cheaper than 82.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.8 | ||
| EV/EBITDA | 14.03 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ZTS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.32
PEG (5Y)1.87
EPS Next 2Y7.52%
EPS Next 3Y8.09%
5. Dividend
5.1 Amount
ZTS has a Yearly Dividend Yield of 1.31%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 0.52, ZTS pays a better dividend. On top of this ZTS pays more dividend than 91.62% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 1.87, ZTS is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.31% |
5.2 History
On average, the dividend of ZTS grows each year by 21.42%, which is quite nice.
ZTS has paid a dividend for at least 10 years, which is 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
ZTS pays out 32.55% of its income as dividend. This is a sustainable payout ratio.
ZTS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP32.55%
EPS Next 2Y7.52%
EPS Next 3Y8.09%
120.98
+2.32 (+1.96%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners97.47%
Inst Owner Change-2.24%
Ins Owners0.06%
Ins Owner Change0.11%
Market Cap53.31B
Revenue(TTM)9.40B
Net Income(TTM)2.65B
Analysts80.83
Price Target170 (40.52%)
Short Float %1.87%
Short Ratio2.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.31% |
Yearly Dividend1.73
Dividend Growth(5Y)21.42%
DP32.55%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.77%
Min EPS beat(2)3.79%
Max EPS beat(2)7.75%
EPS beat(4)4
Avg EPS beat(4)5.09%
Min EPS beat(4)3.63%
Max EPS beat(4)7.75%
EPS beat(8)7
Avg EPS beat(8)3.39%
EPS beat(12)10
Avg EPS beat(12)3.67%
EPS beat(16)12
Avg EPS beat(16)2.98%
Revenue beat(2)1
Avg Revenue beat(2)-0.16%
Min Revenue beat(2)-1.44%
Max Revenue beat(2)1.11%
Revenue beat(4)2
Avg Revenue beat(4)-0.06%
Min Revenue beat(4)-1.44%
Max Revenue beat(4)1.11%
Revenue beat(8)5
Avg Revenue beat(8)0.74%
Revenue beat(12)6
Avg Revenue beat(12)0.2%
Revenue beat(16)7
Avg Revenue beat(16)-0.15%
PT rev (1m)-12.01%
PT rev (3m)-13.1%
EPS NQ rev (1m)-2.93%
EPS NQ rev (3m)-6.35%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)-0.08%
Revenue NQ rev (1m)-0.5%
Revenue NQ rev (3m)-2.66%
Revenue NY rev (1m)-0.7%
Revenue NY rev (3m)-0.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.08 | ||
| Fwd PE | 17.68 | ||
| P/S | 5.67 | ||
| P/FCF | 23.8 | ||
| P/OCF | 18.28 | ||
| P/B | 9.88 | ||
| P/tB | 33.45 | ||
| EV/EBITDA | 14.03 |
EPS(TTM)6.34
EY5.24%
EPS(NY)6.84
Fwd EY5.66%
FCF(TTM)5.08
FCFY4.2%
OCF(TTM)6.62
OCFY5.47%
SpS21.32
BVpS12.25
TBVpS3.62
PEG (NY)2.32
PEG (5Y)1.87
Graham Number41.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.49% | ||
| ROE | 49.11% | ||
| ROCE | 26.92% | ||
| ROIC | 21.45% | ||
| ROICexc | 25.41% | ||
| ROICexgc | 38.35% | ||
| OM | 38.25% | ||
| PM (TTM) | 28.21% | ||
| GM | 71.71% | ||
| FCFM | 23.84% |
ROA(3y)16.01%
ROA(5y)14.94%
ROE(3y)49.01%
ROE(5y)47.06%
ROIC(3y)21.64%
ROIC(5y)19.86%
ROICexc(3y)27.73%
ROICexc(5y)26.47%
ROICexgc(3y)50.54%
ROICexgc(5y)50.93%
ROCE(3y)27.16%
ROCE(5y)24.93%
ROICexgc growth 3Y2.53%
ROICexgc growth 5Y2.14%
ROICexc growth 3Y5.51%
ROICexc growth 5Y8.06%
OM growth 3Y0.39%
OM growth 5Y2.44%
PM growth 3Y0.84%
PM growth 5Y2.31%
GM growth 3Y0.03%
GM growth 5Y0.65%
F-Score6
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 3.16 | ||
| Debt/EBITDA | 1.73 | ||
| Cap/Depr | 138.24% | ||
| Cap/Sales | 7.19% | ||
| Interest Coverage | 12.22 | ||
| Cash Conversion | 71.42% | ||
| Profit Quality | 84.5% | ||
| Current Ratio | 3.64 | ||
| Quick Ratio | 2.28 | ||
| Altman-Z | 6.25 |
F-Score6
WACC9.22%
ROIC/WACC2.33
Cap/Depr(3y)135.63%
Cap/Depr(5y)123.22%
Cap/Sales(3y)7.63%
Cap/Sales(5y)7.16%
Profit Quality(3y)74.77%
Profit Quality(5y)82.34%
High Growth Momentum
Growth
EPS 1Y (TTM)10.07%
EPS 3Y8%
EPS 5Y10.22%
EPS Q2Q%7.59%
EPS Next Y8.23%
EPS Next 2Y7.52%
EPS Next 3Y8.09%
EPS Next 5Y8.09%
Revenue 1Y (TTM)2.68%
Revenue growth 3Y5.98%
Revenue growth 5Y8.14%
Sales Q2Q%0.5%
Revenue Next Year2.14%
Revenue Next 2Y3.63%
Revenue Next 3Y4.33%
Revenue Next 5Y4.6%
EBIT growth 1Y7.7%
EBIT growth 3Y6.4%
EBIT growth 5Y10.78%
EBIT Next Year16.53%
EBIT Next 3Y9.76%
EBIT Next 5Y7.94%
FCF growth 1Y50.13%
FCF growth 3Y9.8%
FCF growth 5Y11.47%
OCF growth 1Y32.73%
OCF growth 3Y10.09%
OCF growth 5Y10.47%
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.
What is the valuation status of ZOETIS INC (ZTS) stock?
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 PE and PB ratios for ZTS stock?
The Price/Earnings (PE) ratio for ZOETIS INC (ZTS) is 19.08 and the Price/Book (PB) ratio is 9.88.
What is the expected EPS growth for ZOETIS INC (ZTS) stock?
The Earnings per Share (EPS) of ZOETIS INC (ZTS) is expected to grow by 8.23% in the next year.