Zoetis (ZTS) closed the most recent trading day at $127.92, moving +0.25% from the previous trading session. This change outpaced the S&P 500's 0.3% loss on the day. Meanwhile, the Dow lost 0.52%, and the Nasdaq, a tech-heavy index, lost 0.14%.
Coming into today, shares of the animal health company had gained 4.34% in the past month. In that same time, the Medical sector gained 4.68%, while the S&P 500 gained 2.46%.
ZTS will be looking to display strength as it nears its next earnings release, which is expected to be November 7, 2019. In that report, analysts expect ZTS to post earnings of $0.89 per share. This would mark year-over-year growth of 7.23%. Meanwhile, our latest consensus estimate is calling for revenue of $1.58 billion, up 6.85% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.57 per share and revenue of $6.24 billion. These totals would mark changes of +14.06% and +7.2%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for ZTS. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ZTS is holding a Zacks Rank of #2 (Buy) right now.
Investors should also note ZTS's current valuation metrics, including its Forward P/E ratio of 35.72. Its industry sports an average Forward P/E of 17.38, so we one might conclude that ZTS is trading at a premium comparatively.
It is also worth noting that ZTS currently has a PEG ratio of 3.16. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Medical - Drugs industry currently had an average PEG ratio of 2.6 as of yesterday's close.
The Medical - Drugs industry is part of the Medical sector. This group has a Zacks Industry Rank of 44, putting it in the top 18% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
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