ZTS Zoetis Inc. - Fundamental Analysis
BULLISH
ZTS Stock | Fundamental Analysis & Investment Insights
NYSE
•
Healthcare
•
Drug Manufacturers - Specialty & Generic
Current Price
$120.82
Analyst Target
$170.63
+41.2% Upside
52W High
$181.85
52W Low
$117.26
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
88%
Analysis Accuracy
Zoetis Inc. (ZTS) presents a compelling investment opportunity despite near-term price underperformance, with shares down 29.9% over the past year. The company demonstrates exceptional profitability, including a 39.33% operating margin and 49.87% ROE—both materially above sector averages—while maintaining consistent earnings growth and a strong track record of beating estimates in 3 of the last 4 quarters. Valuation remains attractive relative to peers, trading at a forward P/E of 19.06 versus the sector average of 43.86, creating significant margin of safety. Analysts reflect this optimism with a $170.63 target price, implying ~41% upside, supported by durable cash flows and a disciplined capital allocation strategy including a sustainable 1.66% dividend yield.
Key Strengths
Exceptional profitability: 39.33% operating margin vs. sector avg of 15.98%
Superior return metrics: 49.87% ROE vs. sector avg of 42.28%
Consistent earnings outperformance: 3 of last 4 quarters beat estimates, with 5.47% avg surprise
Attractive valuation: Forward P/E of 19.06 vs. sector P/E of 43.86
Strong liquidity: Current ratio of 3.64 and quick ratio of 2.01 indicate robust short-term financial health
Key Risks
Low revenue growth: YoY revenue growth of only 0.50% raises concerns about top-line momentum
High debt burden: Debt/Equity of 1.35 exceeds sector average of 1.15 and peer group levels
Price underperformance: 5Y return of -23.5% and 1Y return of -29.9% reflect investor skepticism
Limited insider support: Recent insider selling activity signals lack of confidence from executives
Missing key financial data: Absence of EV, cash, debt, and FCF figures limits full credit and leverage analysis
AI Fair Value Estimate
Based on comprehensive analysis
$170.63
+41.2% above current price
Performance Snowflake
Multi-dimensional AI analysis across 5 key categories
Stock Price & Analyst Targets
Real-time price movements and analyst price targets
Historical Performance Trends
Long-term financial metrics and growth patterns
Valuation Metrics
Key valuation ratios and pricing indicators
Profitability, Growth & Financial Health
Detailed profit margins, ROE, debt ratios, and liquidity metrics
Sector Comparison & Peer Analysis
Compare ZTS against industry averages and similar companies
Insider Trading & Analyst Ratings
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