Zoetis (ZTS)
NYSE:ZTS
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Zoetis
(NYSE:ZTS)
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Rating:75Outperform
Price Target:
$145.00
▲(25.84% Upside)
Action:ReiteratedDate:02/13/26
The score is driven primarily by strong, durable financial performance (growth, margins, and cash flow) and a generally positive but cautious earnings outlook. Technicals are improving but still constrained by the longer-term downtrend versus the 200-day average, while valuation is only moderately attractive given the P/E and modest yield.
Positive Factors
Revenue Growth & Margin Durability
Steady top-line expansion paired with consistently high gross and operating margins indicates durable pricing power across products and species. This structural profitability supports reinvestment in R&D and commercial channels, sustaining long-term earnings and resilience to cyclical demand swings.
Negative Factors
OA Pain (mAb) Franchise Weakness
Material and persistent declines in the OA monoclonal antibody portfolio reduce growth in the Companion Animal segment and undermine a previously meaningful revenue stream. Prolonged weakness may require increased marketing, pricing incentives, or R&D pivots, pressuring margins and long-term revenue growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth & Margin Durability
Steady top-line expansion paired with consistently high gross and operating margins indicates durable pricing power across products and species. This structural profitability supports reinvestment in R&D and commercial channels, sustaining long-term earnings and resilience to cyclical demand swings.
Read all positive factors
Zoetis (ZTS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$48.64B
Dividend Yield1.69%
Average Volume (3M)4.49M
Price to Earnings (P/E)20.9
Beta (1Y)0.56
Revenue Growth2.68%
EPS Growth11.51%
CountryUS
Employees13,800
SectorHealthcare
Sector Strength45
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)1.48
Shares Outstanding422,127,720
10 Day Avg. Volume4,704,258
30 Day Avg. Volume4,485,364
Financial Highlights & Ratios
PEG Ratio2.04
Price to Book (P/B)16.75
Price to Sales (P/S)5.89
P/FCF Ratio24.44
Enterprise Value/Market Cap1.20
Enterprise Value/Revenue6.16
Enterprise Value/Gross Profit8.73
Enterprise Value/Ebitda14.26
Forecast
1Y Price Target
$145.80Price Target Upside26.53% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)7.01
Revenue Forecast (FY)$9.91B
Zoetis Business Overview & Revenue Model
Company Description
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 a...
How the Company Makes Money
Zoetis generates revenue primarily through the sale of its animal health products, which include pharmaceuticals, vaccines, and diagnostic services. The company's revenue model is built on a diverse portfolio of products that cater to various anim...
Zoetis Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyZoetis Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call reflects a fundamentally positive operational performance and financial discipline: solid organic revenue (6%), adjusted net income growth, margin expansion, strong franchises (Simparica, Diagnostics, Livestock), and active capital returns. However, material near-term headwinds remain—most notably weakness in the OA pain monoclonal antibody franchise, increased competitive promotional activity (especially in dermatology and parasiticides), U.S. clinic traffic sensitivity, and one-time international timing effects that complicate quarter-to-quarter comparability. Management provided prudent 2026 guidance that incorporates competition and timing adjustments while highlighting a robust pipeline and long-term growth drivers.Positive Updates
Full-Year Revenue Growth (Organic/Reported)
Reported global revenue of $9.5B, up 2% on a reported basis and 6% on an organic operational basis (driven by ~4% price and ~2% volume).
Negative Updates
U.S. Clinic Traffic and Pet Owner Price Sensitivity
Ongoing economic pressure on Gen Z/millennial pet owners led to declines in therapeutic visits and doses; routine care is more price-sensitive, impacting volumes and compounding competitive headwinds.
Read all updates
Q4-2025 Updates
Positive
Negative
Full-Year Revenue Growth (Organic/Reported)
Reported global revenue of $9.5B, up 2% on a reported basis and 6% on an organic operational basis (driven by ~4% price and ~2% volume).
Read all positive updates
Company Guidance
Zoetis guided 2026 to 3%–5% organic operational revenue growth and 3%–6% organic operational adjusted net income growth (foreign exchange assumed as of late January), which on a reported basis implies revenue of $9.825–$10.025 billion and adjusted net income of $2.975–$3.025 billion; adjusted diluted EPS is expected to be $7.00–$7.10 (reported diluted EPS $6.65–$6.75) with an estimated ~$0.22 EPS benefit from recent share repurchases. Key operating assumptions include adjusted cost of sales of ~28% of revenue, adjusted SG&A of $2.43–$2.49 billion, adjusted R&D of $715–$725 million, adjusted interest and other of ~ $200 million, and an adjusted effective tax rate of ~20.5%; guidance reflects contributions from both price and volume (price contribution in line with the company’s normal ~2%–3% range) and does not assume revenues for products or geographies lacking approvals.Zoetis Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
78
Positive
Cash Flow
82
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 9.47B | 9.26B | 8.54B | 8.08B | 7.78B |
| Gross Profit | 6.67B | 6.40B | 5.83B | 5.48B | 5.31B |
| EBITDA | 4.07B | 3.87B | 3.69B | 3.36B | 3.17B |
| Net Income | 2.67B | 2.49B | 2.34B | 2.11B | 2.04B |
Balance Sheet | |||||
| Total Assets | 15.47B | 14.24B | 14.29B | 14.93B | 13.90B |
| Cash, Cash Equivalents and Short-Term Investments | 2.31B | 1.99B | 2.04B | 3.58B | 3.48B |
| Total Debt | 9.49B | 6.74B | 6.75B | 8.09B | 6.74B |
| Total Liabilities | 12.14B | 9.47B | 9.29B | 10.52B | 9.36B |
| Stockholders Equity | 3.33B | 4.77B | 5.00B | 4.41B | 4.54B |
Cash Flow | |||||
| Free Cash Flow | 2.28B | 2.30B | 1.62B | 1.33B | 1.74B |
| Operating Cash Flow | 2.90B | 2.95B | 2.35B | 1.91B | 2.21B |
| Investing Cash Flow | -748.00M | -315.00M | -777.00M | -883.00M | -458.00M |
| Financing Cash Flow | -1.87B | -2.66B | -3.11B | -904.00M | -1.86B |
Zoetis Technical Analysis
Negative
115.23
Price Trends
124.11
Negative
124.14
Negative
137.26
Negative
Market Momentum
-2.72
Positive
36.26
Neutral
14.59
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZTS, the sentiment is Negative. The current price of 115.23 is below the 20-day moving average (MA) of 122.04, below the 50-day MA of 124.11, and below the 200-day MA of 137.26, indicating a bearish trend. The MACD of -2.72 indicates Positive momentum. The RSI at 36.26 is Neutral, neither overbought nor oversold. The STOCH value of 14.59 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ZTS.
Zoetis Risk Analysis
Zoetis disclosed 51 risk factors in its most recent earnings report. Zoetis reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
Conversion of our convertible senior notes may dilute the ownership interest of our stockholders or may otherwise depress the price of our common stock. Q4, 2025
2.
We may not have the ability to raise the funds necessary to settle conversions of our convertible senior notes in cash, or to repurchase the convertible senior notes upon a fundamental change, and our existing debt contains, and future debt may contain, limitations on our ability to pay cash upon conversion or repurchase of the convertible senior notes. Q4, 2025
3.
The conditional conversion feature of our convertible senior notes, if triggered, may adversely affect our financial condition and operating results. Q4, 2025
Zoetis Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $48.64B | 20.87 | 58.23% | 1.69% | 2.68% | 11.51% | |
74 Outperform | $2.18B | 13.79 | 30.81% | 1.28% | 33.71% | 289.48% | |
70 Outperform | $11.17B | 21.72 | 16.00% | 0.64% | 10.63% | 6.35% | |
58 Neutral | $12.15B | -48.42 | -3.51% | ― | 3.08% | -82.39% | |
56 Neutral | $15.30B | -4.15 | -22.99% | 3.99% | -6.40% | -320.23% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
ZTS
Zoetis
115.23
-43.76
-27.52%
RDY
Dr Reddy's Laboratories
13.69
0.31
2.29%
VTRS
Viatris
13.29
4.74
55.42%
PAHC
Phibro Animal Health
53.80
32.57
153.45%
ELAN
Elanco Animal Health
24.44
13.93
132.54%
Zoetis Corporate Events
Dividends
Zoetis Board Declares Second-Quarter 2026 Cash Dividend
Positive
Feb 5, 2026
On February 5, 2026, Zoetis Inc.’s board of directors declared a second-quarter 2026 dividend of $0.53 per share, to be paid on June 2, 2026, to shareholders of record as of April 20, 2026, underscoring the company’s ongoing practice o...
Stock BuybackPrivate Placements and Financing
Zoetis Announces Convertible Notes Offering and Share Repurchases
Positive
Dec 18, 2025
On December 15, 2025, Zoetis announced a proposed private offering of $1.75 billion in convertible senior notes due 2029, with an option for initial purchasers to buy an additional $250 million, targeted exclusively at qualified institutional buye...
Dividends
Zoetis Announces 6% Increase in Quarterly Dividend
Positive
Dec 11, 2025
On December 11, 2025, Zoetis announced a 6% increase in its quarterly dividend, declaring a dividend of $0.53 per share for the first quarter of 2026. This decision reflects the company’s commitment to delivering value to its shareholders an...
Business Operations and Strategy
Zoetis Hosts Innovation Webcast on Animal Health
Positive
Dec 2, 2025
Zoetis Inc. announced an Innovation Webcast scheduled for December 2, 2025, to discuss the future of animal health. The webcast will highlight the company’s strategic focus on innovation, market opportunities, and the growing demand for adva...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.