Fact based stock research
Zoetis (NYSE:ZTS)

US98978V1035

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Zoetis stock research in summary

zoetis.com

ANALYSIS: With an Obermatt Combined Rank of 15 (worse than 85% compared with investment alternatives), Zoetis (Pharmaceuticals, USA) shares have lower financial characteristics compared with similar stocks. Shares of Zoetis are low in value (priced high) with a consolidated Value Rank of 22 (worse than 78% of alternatives) and show below-average growth (Growth Rank of 39) but are safely financed (Safety Rank of 50), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 15, is a sell recommendation based on Zoetis's financial characteristics. As the company Zoetis's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 22) and low growth (Obermatt Growth Rank of 39), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 50) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	22
Growth Rank	39
Safety Rank	50
Combined Rank	15

Country	USA
Industry	Pharmaceuticals
Index	Dividends USA, Employee Focus US, Diversity USA, D.J. US Pharmaceutical, S&P 500
Size class	X-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Zoetis

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	10	25	17	22
GROWTH
GROWTH	85	83	71	39
SAFETY
SAFETY	18	34	41	50
SENTIMENT
SENTIMENT	n/a	84	98	^new
360° VIEW
360° VIEW	n/a	66	72	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Zoetis is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	10	25	17	22
GROWTH
GROWTH	85	83	71	39
SAFETY
SAFETY	18	34	41	50
COMBINED
COMBINED	24	34	28	15

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Zoetis the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 22 (worse than 78% compared with alternatives), Zoetis shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Zoetis. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 86% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 5 which means that the stock price compared with what market professionals expect for future profits is higher than 95% of comparable companies, indicating a low value concerning Zoetis's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 34 which means that the stock price compared with what market professionals expect for future profit levels is higher than 66% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 4 is also low. Compared with invested capital, the stock price is higher than for 96% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 22, is a sell recommendation based on Zoetis's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Zoetis? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Zoetis only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	10	10	7	5
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	33	22	28	34
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	2	1	1	4
DIVIDEND YIELD
DIVIDEND YIELD	45	86	84	86
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	10	25	17	22

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Zoetis; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Zoetis shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for Zoetis. Sales Growth has a rank of 40, which means that currently professionals expect the company to grow less than 60% of its competitors. The same is valid for Profit Growth, with a rank of 45, and Capital Growth with 49. In addition, Stock Returns have a below market rank of 37, which means that the stock returns have recently been below 63% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, is a hold recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	59	39	62	40
PROFIT GROWTH
PROFIT GROWTH	100	62	49	45
CAPITAL GROWTH
CAPITAL GROWTH	n/a	64	36	49
STOCK RETURNS
STOCK RETURNS	76	91	81	37
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	85	83	71	39

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Zoetis.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 50 (better than 50% compared with alternatives), the company Zoetis has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Zoetis is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Zoetis. Liquidity is at 92, meaning the company generates more profit to service its debt than 92% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 33, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 67% of its competitors. Leverage is also high at a rank of 25, which means that the company has an above-average debt-to-equity ratio. It has more debt than 75% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 50 (better than 50% compared with alternatives), Zoetis has a financing structure that is safer than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	33	23	19	25
REFINANCING
REFINANCING	16	17	27	33
LIQUIDITY
LIQUIDITY	44	79	82	92
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	18	34	41	50

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Zoetis and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	63	67	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	23	44	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	84	89	^new
MARKET PULSE
MARKET PULSE	n/a	74	91	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	84	98	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Zoetis.
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