Zoetis (ZTS) closed the most recent trading day at $78.71, moving +1.88% from the previous trading session. This move outpaced the S&P 500's daily gain of 1.09%. On the other hand, the Dow registered a gain of 0.14%, and the technology-centric Nasdaq increased by 1.91%.
The stock of animal health company has fallen by 3.07% in the past month, lagging the Medical sector's gain of 3.16% and the S&P 500's gain of 0.29%.
The upcoming earnings release of Zoetis will be of great interest to investors. The company is predicted to post an EPS of $1.85, indicating a 5.11% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.49 billion, up 1.39% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.91 per share and a revenue of $9.75 billion, representing changes of +7.8% and +2.96%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Zoetis. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.23% upward. As of now, Zoetis holds a Zacks Rank of #4 (Sell).
Digging into valuation, Zoetis currently has a Forward P/E ratio of 11.18. For comparison, its industry has an average Forward P/E of 16.05, which means Zoetis is trading at a discount to the group.
Also, we should mention that ZTS has a PEG ratio of 1.2. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Medical - Drugs was holding an average PEG ratio of 1.57 at yesterday's closing price.
The Medical - Drugs industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 149, finds itself in the bottom 39% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Zoetis Inc. (ZTS): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).