Zoetis Inc. Prepares to Report Q1 Earnings Amid Mixed Financials
Parsippany, New Jersey-based Zoetis Inc. (ZTS) specializes in discovering, developing, and commercializing animal health medicines, vaccines, and diagnostic products and services. With a market cap of $66.9 billion, Zoetis is the largest producer of animal health products globally, operating in over 100 countries including those in North America and Europe.
Upcoming First Quarter Earnings Release
On Tuesday, May 6, Zoetis is expected to announce its first-quarter results before the market opens. Analysts anticipate an adjusted profit of $1.40 per share, growing 1.5% from $1.38 per share in the same quarter last year. Notably, Zoetis has exceeded analysts’ bottom-line estimates each of the past four quarters, signaling positive financial momentum.
Fiscal Forecasts for 2025 and 2026
For the full fiscal year 2025, earnings are projected to reach $6.08 per share, reflecting a 2.7% increase compared to $5.93 in fiscal 2024. Furthermore, analysts predict a more significant earnings increase in fiscal 2026, estimating a rise of 9.4% year-over-year to $6.65 per share.
Stock Performance Overview
Over the past 52 weeks, ZTS stock prices have experienced a marginal 90 basis points uptick, which is favorable compared to the Healthcare Select Sector SPDR Fund’s (XLV) 3.9% decline and trails the S&P 500 Index’s ($SPX) 6% gains during the same period.
Recent Financial Results
Despite positive financial results, ZTS stock plunged 5.2% following the release of its Q4 results on February 13. The company reported a 2.6% decline in livestock-related revenues, totaling $726 million, primarily due to unfavorable foreign exchange impacts. In contrast, revenues from companion animals grew significantly, increasing 8.4% year-over-year to $1.6 billion. Overall, Zoetis reported a topline increase of 4.7% year-over-year to $2.3 billion, surpassing expectations. Additionally, adjusted net income for the quarter rose 11.1% year-over-year to $632 million, with adjusted EPS reaching $1.40, exceeding consensus estimates by 2.2%.
Investor Sentiments and Analysts’ Opinions
In fiscal 2024, Zoetis saw revenues increase by 8.3% year-over-year to $9.3 billion, with adjusted EPS climbing 11.3% to $5.92. However, guidance for fiscal 2025 suggests revenues will range between $9.2 billion and $9.4 billion, indicating potential stagnation. Furthermore, the adjusted EPS guidance of $6.00 to $6.10 signals only modest growth at the midpoint, which may have unsettled some investors.
Despite the fluctuations, analysts maintain an optimistic outlook for Zoetis stock. The consensus rating on ZTS stock is a “Strong Buy,” with 14 out of 16 analysts recommending “Strong Buys,” one suggesting a “Moderate Buy,” and one marking it as a “Hold.” Currently, ZTS stock is trading significantly below its average price target of $206.47.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
