ZOETIS INC (ZTS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ZTS - US98978V1035 - Common Stock
125.98 USD
-0.25 (-0.2%)
125.98 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to ZTS. ZTS was compared to 191 industry peers in the Pharmaceuticals industry. ZTS scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ZTS has a decent growth rate and is not valued too expensively. These ratings could make ZTS a good candidate 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.
In the past 5 years ZTS has always been profitable.
In the past 5 years ZTS always reported a positive cash flow from operatings.
1.2 Ratios
ZTS has a better Return On Assets (17.49%) than 96.34% of its industry peers.
ZTS has a better Return On Equity (49.11%) than 97.91% of its industry peers.
With an excellent Return On Invested Capital value of 21.45%, ZTS belongs to the best of the industry, outperforming 96.86% of the companies in the same industry.
ZTS had an Average Return On Invested Capital over the past 3 years of 21.64%. This 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
ZTS has a Profit Margin of 28.21%. This is amongst the best in the industry. ZTS outperforms 93.72% of its industry peers.
In the last couple of years the Profit Margin of ZTS has grown nicely.
With an excellent Operating Margin value of 38.25%, ZTS belongs to the best of the industry, outperforming 96.86% of the companies in the same industry.
In the last couple of years the Operating Margin of ZTS has grown nicely.
ZTS has a better Gross Margin (71.71%) than 79.06% of its industry peers.
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.
The number of shares outstanding for ZTS has been reduced compared to 1 year ago.
The number of shares outstanding for ZTS has been reduced compared to 5 years ago.
Compared to 1 year ago, ZTS has a worse debt to assets ratio.
2.2 Solvency
ZTS has an Altman-Z score of 6.46. This indicates that ZTS is financially healthy and has little risk of bankruptcy at the moment.
ZTS's Altman-Z score of 6.46 is fine compared to the rest of the industry. ZTS outperforms 77.49% of its industry peers.
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.
Looking at the Debt to FCF ratio, with a value of 3.16, ZTS belongs to the top of the industry, outperforming 89.01% of the companies in the same industry.
A Debt/Equity ratio of 1.31 is on the high side and indicates that ZTS has dependencies on debt financing.
With a Debt to Equity ratio value of 1.31, ZTS is not doing good in the industry: 75.39% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 3.16 | ||
| Altman-Z | 6.46 |
ROIC/WACC2.35
WACC9.14%
2.3 Liquidity
A Current Ratio of 3.64 indicates that ZTS has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 3.64, ZTS is in line with its industry, outperforming 56.54% of the companies in the same industry.
ZTS has a Quick Ratio of 2.28. This indicates that ZTS is financially healthy and has no problem in meeting 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
ZTS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.07%, which is quite good.
ZTS shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.22% yearly.
The Revenue has been growing slightly by 2.68% in the past year.
Measured over the past years, ZTS shows a quite strong growth in Revenue. The Revenue has been growing by 8.14% on average per year.
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 quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.09% yearly.
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 Y8.15%
EPS Next 2Y7.44%
EPS Next 3Y7.99%
EPS Next 5Y8.09%
Revenue Next Year2.07%
Revenue Next 2Y3.51%
Revenue Next 3Y4.23%
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
The Price/Earnings ratio is 19.87, which indicates a rather expensive current valuation of ZTS.
81.68% of the companies in the same industry are more expensive than ZTS, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.84. ZTS is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 18.44 indicates a rather expensive valuation of ZTS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ZTS indicates a somewhat cheap valuation: ZTS is cheaper than 77.49% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.40, ZTS is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.87 | ||
| Fwd PE | 18.44 |
4.2 Price Multiples
ZTS's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ZTS is cheaper than 82.72% of the companies in the same industry.
82.72% 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 | 24.78 | ||
| EV/EBITDA | 14.85 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ZTS may justify a higher PE ratio.
PEG (NY)2.44
PEG (5Y)1.95
EPS Next 2Y7.44%
EPS Next 3Y7.99%
5. Dividend
5.1 Amount
ZTS has a Yearly Dividend Yield of 1.31%.
ZTS's Dividend Yield is rather good when compared to the industry average which is at 0.61. ZTS pays more dividend than 91.62% of the companies in the same industry.
ZTS's Dividend Yield is slightly below the S&P500 average, which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.31% |
5.2 History
The dividend of ZTS is nicely growing with an annual growth rate of 21.42%!
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.
The dividend of ZTS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP32.55%
EPS Next 2Y7.44%
EPS Next 3Y7.99%
125.98
-0.25 (-0.2%)
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 Cap55.52B
Revenue(TTM)9.40B
Net Income(TTM)2.65B
Analysts80.83
Price Target163.06 (29.43%)
Short Float %2.08%
Short Ratio2.08
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)-6.84%
PT rev (3m)-16.65%
EPS NQ rev (1m)-0.61%
EPS NQ rev (3m)-6.32%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-0.3%
Revenue NQ rev (1m)-0.21%
Revenue NQ rev (3m)-2.66%
Revenue NY rev (1m)-0.77%
Revenue NY rev (3m)-0.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.87 | ||
| Fwd PE | 18.44 | ||
| P/S | 5.91 | ||
| P/FCF | 24.78 | ||
| P/OCF | 19.04 | ||
| P/B | 10.28 | ||
| P/tB | 34.83 | ||
| EV/EBITDA | 14.85 |
EPS(TTM)6.34
EY5.03%
EPS(NY)6.83
Fwd EY5.42%
FCF(TTM)5.08
FCFY4.03%
OCF(TTM)6.62
OCFY5.25%
SpS21.32
BVpS12.25
TBVpS3.62
PEG (NY)2.44
PEG (5Y)1.95
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 | 6.46 |
F-Score6
WACC9.14%
ROIC/WACC2.35
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 Y8.15%
EPS Next 2Y7.44%
EPS Next 3Y7.99%
EPS Next 5Y8.09%
Revenue 1Y (TTM)2.68%
Revenue growth 3Y5.98%
Revenue growth 5Y8.14%
Sales Q2Q%0.5%
Revenue Next Year2.07%
Revenue Next 2Y3.51%
Revenue Next 3Y4.23%
Revenue Next 5Y4.6%
EBIT growth 1Y7.7%
EBIT growth 3Y6.4%
EBIT growth 5Y10.78%
EBIT Next Year16.84%
EBIT Next 3Y9.66%
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 19.87 and the Price/Book (PB) ratio is 10.28.
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 8.15% in the next year.