Zoetis (ZTS) Outpaces Stock Market Gains: What You Should Know

Zoetis (ZTS) ended the recent trading session at $118.15, demonstrating a +2.19% change from the preceding day's closing price. This move outpaced the S&P 500's daily gain of 1.01%. Elsewhere, the Dow saw an upswing of 0.83%, while the tech-heavy Nasdaq appreciated by 1.22%.

Shares of the animal health company have depreciated by 8.71% over the course of the past month, underperforming the Medical sector's loss of 5.53%, and the S&P 500's loss of 2.86%.

Analysts and investors alike will be keeping a close eye on the performance of Zoetis in its upcoming earnings disclosure. The company is predicted to post an EPS of $1.61, indicating a 8.78% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.32 billion, up 4.57% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $6.99 per share and revenue of $9.91 billion, indicating changes of +9.05% and +4.64%, respectively, compared to the previous year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Zoetis. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 3.21% higher. Currently, Zoetis is carrying a Zacks Rank of #2 (Buy).

Looking at valuation, Zoetis is presently trading at a Forward P/E ratio of 16.55. This signifies a discount in comparison to the average Forward P/E of 16.59 for its industry.

One should further note that ZTS currently holds a PEG ratio of 1.77. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Medical - Drugs was holding an average PEG ratio of 1.31 at yesterday's closing price.

The Medical - Drugs industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 144, finds itself in the bottom 42% echelons of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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Zoetis Inc. (ZTS): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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