NYSE · Healthcare

Zoetis Inc.

ZTS · Drug Manufacturers - Specialty & Generic

$112.53

▼ -1.63 (-1.43%)

Data cached · refreshes every 10 min

Mr. Market is currently offering Zoetis Inc. at $112.53.

The business passes 5 of 7 of Graham's defensive criteria — adequate but not exceptional.

Overall Grade

Defensive

Enterprising

Profitability A

Gross Profit Margin 71.8%

Operating Margin 38.0%

Net Income Margin 28.2%

Fin. Health C

Years to Pay Off Debt 3.5 yrs

Working Capital vs Long-Term Debt -$4.5B

Working Capital $4.5B

Valuation F

Margin of Safety 0.0%

Price-to-Book 14.21x

Cash Flow B

Free Cash Flow $2.3B

CapEx % of Net Income 23.2%

Owner Earnings $3.8B

5/7

Graham Score

Enterprising

Defensive — Graham's strict criteria (P/B, P/E, dividends, stability) · Enterprising — Profitability & cash flow focused, accepts higher valuations for quality

Market Data

Market Cap $47.5B

Enterprise Value $55.2B

P/E (TTM) 18.69

Dividend Yield 1.75%

Exchange NYSE

Key Margins

Gross Profit 71.8%

Operating Margin 38.0%

Net Margin 28.2%

Company Info

Sector Healthcare

Industry Drug Manufacturers - Specialty & Generic

Employees 14500

Country United States

Visit website

📖

Full Graham Analysis

Mr. Market is currently offering Zoetis Inc. at $112.53.

The business passes 5 of 7 of Graham's defensive criteria — adequate but not exceptional.

At $112.53, the stock trades at a 243% premium to its Graham Number of $32.76. Graham would consider this price speculative.

There is no margin of safety at the current price. Graham would advise patience and waiting for a better entry point.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: This stock is better suited for Graham's Enterprising investor — one willing to devote time and skill to security selection.

About Zoetis Inc.

Zoetis Inc. engages in the discovery, development, manufacture, and commercialization of medicines, vaccines, diagnostic products and services, biodevices, genetic tests, and precision animal health solutions for the animal health industry in the United States and internationally. The company commercializes products primarily across companion animals comprising dogs, cats, and horses; and species, including livestock, such as cattle, swine, poultry, fish, and sheep. It also offers parasiticides, vaccines, dermatology, anti-infectives, pain and sedation, other pharmaceutical, and animal health diagnostics. In addition, the company provides animal health diagnostics, including point-of-care diagnostic products, instruments and reagents, rapid immunoassay tests, reference laboratory kits and services, and blood glucose monitors; and other non-pharmaceutical products, which include nutritionals, as well as products and services in biodevices, genetic tests, and precision animal health. It markets its products to veterinarians, livestock producers, and pet owners. The company has collaborated with Blacksmith Medicines, Inc. to discover and develop novel antibiotics for animal health. Zoetis Inc. was incorporated in 2012 and is headquartered in Parsippany, New Jersey.

Showing Key Metrics

Income Highlights

Metric	2025	2024	2023	2022
Gross Profit %	71.8% ▲	70.6%	70.0%	69.6%
Operating Margin %	38.0% ▲	36.6%	35.9%	36.2%
Net Income %	28.2% ▲	26.9%	27.4%	26.2%
Diluted EPS	6.02 ▲	5.47	5.07	4.49

Balance Sheet Highlights

Metric	2025	2024	2023	2022	2021
Total Assets	$15.5B	$14.2B	$14.3B	$14.9B	N/A
Total Debt	$9.2B ↑	$6.7B	$6.8B	$8.1B	N/A
Working Capital	$4.5B ▲	$2.6B	$4.5B	$4.3B	N/A
Years to Pay Debt	3.46	2.71	2.88	3.83	N/A

Cash Flow Highlights

Metric	2025	2024	2023	2022	2021
Free Cash Flow	$2.3B ▼	$2.3B	$1.6B	$1.3B	N/A
Owner Earnings	$3.8B	$3.6B	$3.6B	$3.2B	N/A
CapEx % of Net Income	23.2%	26.3%	31.2%	27.7%	N/A

Income Statement

	2025	2024	2023	2022
Tax Effect Of Unusual Items	-21,216	-28,623	-6,902	-24,418
Tax Rate For Calcs	0	0	0	0
Normalized EBITDA	4,173,000	3,996,000	3,700,000	3,461,000
Total Unusual Items	-104,000	-141,000	-34,000	-119,000
Total Unusual Items Excluding Goodwill	-104,000	-141,000	-34,000	-119,000
Net Income From Continuing Operation Net Minority Interest	2,673,000	2,486,000	2,344,000	2,114,000
Reconciled Depreciation	487,000	497,000	491,000	465,000
Reconciled Cost Of Revenue	2,307,000	2,363,000	2,219,000	2,139,000
EBITDA	4,069,000	3,855,000	3,666,000	3,342,000
EBIT	3,582,000	3,358,000	3,175,000	2,877,000
Net Interest Income	-129,000	-119,000	-134,000	-171,000
Interest Expense	222,000	225,000	239,000	221,000
Interest Income	93,000	106,000	105,000	50,000
Normalized Income	2,755,784	2,598,377	2,371,098	2,208,582
Net Income From Continuing And Discontinued Operation	2,673,000	2,486,000	2,344,000	2,114,000
Total Expenses	5,870,000	5,864,000	5,475,000	5,152,000
Diluted Average Shares	443,800	454,800	462,300	470,400
Basic Average Shares	443,400	454,200	461,200	468,900
Diluted EPS	0	0	0	0
Basic EPS	0	0	0	0
Diluted NI Availto Com Stockholders	2,673,000	2,486,000	2,344,000	2,114,000
Net Income Common Stockholders	2,673,000	2,486,000	2,344,000	2,114,000
Net Income	2,673,000	2,486,000	2,344,000	2,114,000
Minority Interests	0	-10,000	4,000	3,000
Net Income Including Noncontrolling Interests	2,673,000	2,496,000	2,340,000	2,111,000
Net Income Continuous Operations	2,673,000	2,496,000	2,340,000	2,111,000
Tax Provision	687,000	637,000	596,000	545,000
Pretax Income	3,360,000	3,133,000	2,936,000	2,656,000
Other Income Expense	-108,000	-140,000	1,000	-101,000
Other Non Operating Income Expenses	-4,000	1,000	35,000	18,000
Special Income Charges	-59,000	-91,000	13,000	-57,000
Gain On Sale Of Ppe	0	-16,000	0	0
Gain On Sale Of Business	-3,000	-23,000	101,000	0
Write Off	22,000	0	1,000	9,000
Impairment Of Capital Assets	5,000	15,000	35,000	39,000
Restructuring And Mergern Acquisition	29,000	37,000	52,000	9,000
Gain On Sale Of Security	-45,000	-50,000	-47,000	-62,000
Net Non Operating Interest Income Expense	-129,000	-119,000	-134,000	-171,000
Interest Expense Non Operating	222,000	225,000	239,000	221,000
Interest Income Non Operating	93,000	106,000	105,000	50,000
Operating Income	3,597,000	3,392,000	3,069,000	2,928,000
Operating Expense	3,204,000	3,145,000	2,914,000	2,698,000
Depreciation Amortization Depletion Income Statement	128,000	141,000	149,000	150,000
Depreciation And Amortization In Income Statement	128,000	141,000	149,000	150,000
Amortization	128,000	141,000	149,000	150,000
Amortization Of Intangibles Income Statement	128,000	141,000	149,000	150,000
Research And Development	698,000	686,000	614,000	539,000
Selling General And Administration	2,378,000	2,318,000	2,151,000	2,009,000
Gross Profit	6,801,000	6,537,000	5,983,000	5,626,000
Cost Of Revenue	2,666,000	2,719,000	2,561,000	2,454,000
Total Revenue	9,467,000	9,256,000	8,544,000	8,080,000
Operating Revenue	9,467,000	9,256,000	8,544,000	8,080,000

Balance Sheet

	2025	2024	2023	2022	2021
Treasury Shares Number	76,964	53,418	43,524	38,083
Ordinary Shares Number	424,928	448,473	458,367	463,808
Share Issued	501,891	501,891	501,891	501,891
Net Debt	6,732,000	4,585,000	4,528,000	4,327,000
Total Debt	9,238,000	6,744,000	6,755,000	8,090,000
Tangible Book Value	-434,000	919,000	900,000	279,000
Invested Capital	12,373,000	11,340,000	11,564,000	12,309,000
Working Capital	4,533,000	2,574,000	4,454,000	4,339,000
Net Tangible Assets	-434,000	919,000	900,000	279,000
Capital Lease Obligations	196,000	174,000	188,000	186,000
Common Stock Equity	3,331,000	4,770,000	4,997,000	4,405,000
Total Capitalization	12,373,000	9,990,000	11,561,000	10,957,000
Total Equity Gross Minority Interest	3,331,000	4,770,000	4,991,000	4,403,000
Minority Interest	0	0	-6,000	-2,000
Stockholders Equity	3,331,000	4,770,000	4,997,000	4,405,000
Gains Losses Not Affecting Retained Earnings	-834,000	-940,000	-839,000	-817,000
Other Equity Adjustments	-834,000	-940,000	-839,000	-817,000
Treasury Stock	10,685,000	7,445,000	5,597,000	4,539,000
Retained Earnings	13,744,000	11,968,000	10,295,000	8,668,000
Additional Paid In Capital	1,101,000	1,182,000	1,133,000	1,088,000
Capital Stock	5,000	5,000	5,000	5,000
Common Stock	5,000	5,000	5,000	5,000
Total Liabilities Net Minority Interest	12,136,000	9,467,000	9,295,000	10,522,000
Total Non Current Liabilities Net Minority Interest	9,901,000	6,055,000	7,406,000	7,355,000
Other Non Current Liabilities	248,000	222,000	237,000	217,000
Tradeand Other Payables Non Current	276,000	272,000	271,000	258,000
Non Current Deferred Liabilities	139,000	167,000	146,000	142,000
Non Current Deferred Taxes Liabilities	139,000	167,000	146,000	142,000
Long Term Debt And Capital Lease Obligation	9,238,000	5,394,000	6,752,000	6,738,000
Long Term Capital Lease Obligation	196,000	174,000	188,000	186,000
Long Term Debt	9,042,000	5,220,000	6,564,000	6,552,000
Current Liabilities	2,235,000	3,412,000	1,889,000	3,167,000
Other Current Liabilities	107,000	125,000	102,000	97,000
Current Debt And Capital Lease Obligation		1,350,000	3,000	1,352,000
Current Debt		1,350,000	3,000	1,352,000
Other Current Borrowings		1,350,000		1,350,000
Line Of Credit		0	3,000	2,000	0
Pensionand Other Post Retirement Benefit Plans Current	410,000	441,000	382,000	300,000
Payables And Accrued Expenses	1,718,000	1,496,000	1,402,000	1,418,000
Current Accrued Expenses	852,000	746,000	683,000	682,000
Payables	866,000	750,000	719,000	736,000
Dividends Payable	232,000	224,000	198,000	174,000
Total Tax Payable	147,000	93,000	110,000	157,000
Income Tax Payable	147,000	93,000	110,000	157,000
Accounts Payable	487,000	433,000	411,000	405,000
Total Assets	15,467,000	14,237,000	14,286,000	14,925,000
Total Non Current Assets	8,699,000	8,251,000	7,943,000	7,419,000
Other Non Current Assets	328,000	250,000	206,000	147,000
Non Current Deferred Assets	637,000	540,000	206,000	173,000
Non Current Deferred Taxes Assets	637,000	540,000	206,000	173,000
Goodwill And Other Intangible Assets	3,765,000	3,851,000	4,097,000	4,126,000
Other Intangible Assets	998,000	1,127,000	1,338,000	1,380,000
Goodwill	2,767,000	2,724,000	2,759,000	2,746,000
Net PPE	3,969,000	3,610,000	3,434,000	2,973,000
Accumulated Depreciation	-2,925,000	-2,635,000	-2,594,000	-2,297,000
Gross PPE	6,894,000	6,245,000	6,028,000	5,270,000
Construction In Progress	1,295,000	1,353,000	1,085,000	814,000
Other Properties	288,000	219,000	230,000	220,000
Machinery Furniture Equipment	3,729,000	3,353,000	3,372,000	3,013,000
Buildings And Improvements	1,549,000	1,292,000	1,316,000	1,197,000
Land And Improvements	33,000	28,000	25,000	26,000
Current Assets	6,768,000	5,986,000	6,343,000	7,506,000
Other Current Assets	436,000	377,000	434,000	365,000
Restricted Cash	2,000	2,000	2,000	4,000
Inventory	2,430,000	2,306,000	2,564,000	2,345,000
Finished Goods	1,106,000	996,000	1,147,000	1,090,000
Work In Process	962,000	933,000	966,000	825,000
Raw Materials	362,000	377,000	451,000	430,000
Receivables	1,590,000	1,316,000	1,304,000	1,215,000
Accounts Receivable	1,590,000	1,316,000	1,304,000	1,215,000
Allowance For Doubtful Accounts Receivable	-16,000	-18,000	-18,000	-19,000
Gross Accounts Receivable	1,606,000	1,334,000	1,322,000	1,234,000
Cash Cash Equivalents And Short Term Investments	2,310,000	1,985,000	2,039,000	3,577,000
Cash And Cash Equivalents	2,310,000	1,985,000	2,039,000	3,577,000

Cash Flow

	2025	2024	2023	2022	2021
Free Cash Flow	2,283,000	2,298,000	1,621,000	1,326,000
Repurchase Of Capital Stock	-3,235,000	-1,858,000	-1,092,000	-1,594,000
Repayment Of Debt	-1,350,000	0	-1,350,000	0
Issuance Of Debt	3,848,000	0	0	1,348,000
Capital Expenditure	-621,000	-655,000	-732,000	-586,000
Interest Paid Supplemental Data	261,000	274,000	295,000	242,000
Income Tax Paid Supplemental Data	715,000	892,000	754,000	638,000
End Cash Position	2,312,000	1,987,000	2,041,000	3,581,000
Beginning Cash Position	1,987,000	2,041,000	3,581,000	3,485,000
Effect Of Exchange Rate Changes	39,000	-32,000	-7,000	-29,000
Changes In Cash	286,000	-22,000	-1,533,000	125,000
Financing Cash Flow	-1,870,000	-2,660,000	-3,109,000	-904,000
Cash Flow From Continuing Financing Activities	-1,870,000	-2,660,000	-3,109,000	-904,000
Net Other Financing Charges	-233,000	-5,000	-3,000	-11,000
Proceeds From Stock Option Exercised	-11,000	-8,000	27,000	-38,000
Cash Dividends Paid	-889,000	-786,000	-692,000	-611,000
Common Stock Dividend Paid	-889,000	-786,000	-692,000	-611,000
Net Common Stock Issuance	-3,235,000	-1,858,000	-1,092,000	-1,594,000
Common Stock Payments	-3,235,000	-1,858,000	-1,092,000	-1,594,000
Net Issuance Payments Of Debt	2,498,000	-3,000	-1,349,000	1,350,000
Net Short Term Debt Issuance	0	-3,000	1,000	2,000
Net Long Term Debt Issuance	2,498,000	0	-1,350,000	1,348,000
Long Term Debt Payments	-1,350,000	0	-1,350,000	0
Long Term Debt Issuance	3,848,000	0	0	1,348,000
Investing Cash Flow	-748,000	-315,000	-777,000	-883,000
Cash Flow From Continuing Investing Activities	-748,000	-315,000	-777,000	-883,000
Net Other Investing Changes	1,000	-2,000	6,000	1,000
Net Investment Purchase And Sale	-100,000	57,000	8,000	14,000
Sale Of Investment		62,000	12,000	23,000	44,000
Purchase Of Investment	-100,000	-5,000	-4,000	-9,000
Net Business Purchase And Sale	-28,000	285,000	-59,000	-312,000
Sale Of Business		293,000	96,000	0	0
Purchase Of Business	-28,000	-8,000	-155,000	-312,000
Capital Expenditure Reported	-621,000	-655,000	-732,000	-586,000
Operating Cash Flow	2,904,000	2,953,000	2,353,000	1,912,000
Cash Flow From Continuing Operating Activities	2,904,000	2,953,000	2,353,000	1,912,000
Change In Working Capital	-408,000	79,000	-512,000	-699,000
Change In Other Working Capital	61,000	-17,000	-34,000	98,000
Change In Other Current Liabilities	85,000	114,000	67,000	-180,000
Change In Other Current Assets	-165,000	52,000	-95,000	35,000
Change In Payables And Accrued Expense	46,000	31,000	13,000	-29,000
Change In Payable	46,000	31,000	13,000	-29,000
Change In Account Payable	46,000	31,000	13,000	-29,000
Change In Inventory	-199,000	-40,000	-361,000	-486,000
Change In Receivables	-236,000	-61,000	-102,000	-137,000
Changes In Account Receivables	-236,000	-61,000	-102,000	-137,000
Other Non Cash Items	-8,000	-6,000	-8,000	13,000
Stock Based Compensation	83,000	74,000	60,000	62,000
Provisionand Write Offof Assets	68,000	97,000	115,000	76,000
Asset Impairment Charge	47,000	31,000	46,000	53,000
Deferred Tax	-52,000	-338,000	-61,000	-286,000
Deferred Income Tax	-52,000	-338,000	-61,000	-286,000
Depreciation Amortization Depletion	487,000	497,000	491,000	465,000
Depreciation And Amortization	487,000	497,000	491,000	465,000
Amortization Cash Flow	157,000
Amortization Of Intangibles	157,000
Depreciation	330,000
Operating Gains Losses	14,000	23,000	-118,000	117,000
Pension And Employee Benefit Expense		0	0	3,000	3,000
Gain Loss On Investment Securities	11,000			114,000
Gain Loss On Sale Of Business	3,000	23,000	-118,000	0
Net Income From Continuing Operations	2,673,000	2,496,000	2,340,000	2,111,000

These metrics estimate what Zoetis Inc. is worth based on its fundamentals — independent of what the market currently prices it at. Graham's Fair Value and NCAV are conservative floors rooted in 1930s–60s principles. EPV assumes zero growth. None are price targets — they are reference points for judging whether the current price offers a margin of safety.

Graham's Fair Value

$32.76

Margin of Safety

Market Cap ÷ Company Value

3.71

P/B Ratio

14.21

Warren's Owner Earnings

$3.8B

Latest fiscal year

Graham's 7 Criteria

Defensive Investor Checklist

5/7 — Enterprising Investor

✅ Adequate Size

$9.5B

vs > $1.5B revenue

✅ Strong Financial Condition

3.03x

vs Current Ratio > 2.0x

✅ Earnings Stability

No loss years (4 yrs data)

vs No negative EPS years

✅ Dividend Record

1.75%

vs Uninterrupted dividends

✅ Earnings Growth

+34.1% EPS growth

vs > 33% EPS growth

❌ Moderate P/E Ratio

18.7x

vs P/E ≤ 15.0x

❌ Moderate Price-to-Book

14.21x P/B (P/E×P/B: 265.6)

vs P/B ≤ 1.5x | P/E × P/B ≤ 22.5

Net Current Asset Value

$-12.77

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign.

"Buy at two-thirds of net current assets." — Graham

Earnings Power Value

$95.04

Per share, no-growth floor. Compare to current price.

Cash Flow Analysis

Metric	2025	2024	2023	2022	2021
Capital Expenditure % of Net Income	23.2%	26.3%	31.2%	27.7%	N/A
Repurchase of Capital Stock	-$3.2B	-$1.9B	-$1.1B	-$1.6B	N/A
Free Cash Flow	$2.3B ▼	$2.3B ▲	$1.6B ▲	$1.3B •	N/A •
Warren's Owner Earnings	$3.8B	$3.6B	$3.6B	$3.2B	N/A

Peers & Industry

No auto-detected peers for Drug Manufacturers - Specialty & Generic. You can manually compare ZTS against any stock using the Compare tool.

"The management of a business is its most important single factor — more important than market position, patents, or financial structure."

— Benjamin Graham

Capital Allocation & Alignment

Insider Ownership

0.15%

Low — management has little skin in the game

Return on Equity (ROE)

80.2%

Excellent — management generates strong returns on equity

Return on Assets (ROA)

17.3%

Strong — management uses assets efficiently

Share Buybacks (Latest Year)

$3.2B

Management is returning capital to shareholders via buybacks

Debt Trend YoY

+37.0% YoY

Debt is growing — management is leveraging up

Leadership Team

Kristin Peck

CEO & Director

Age 54

Pay: $5,421,697

0.203% of net income

Wetteny Joseph CPA

Executive VP & CFO

Age 53

Pay: $1,796,941

0.067% of net income

Steven Frank

Vice President of Investor Relations

Nick Ashton

Executive VP and President of Global Manufacturing & Supply

Age 51

Top Institutional Holders

Institution	% Owned	Shares
Vanguard Group Inc	11.36%	47,780,974
Blackrock Inc.	8.88%	37,350,823
State Street Corporation	4.71%	19,796,891
State Farm Mutual Automobile Insurance Co	3.78%	15,892,903
Morgan Stanley	3.68%	15,465,506
Wellington Management Group, LLP	2.71%	11,394,986
Geode Capital Management, LLC	2.69%	11,327,679
NORGES BANK	1.39%	5,837,110

Risk Analysis

Beta (Market Risk)

0.86

Low volatility — more stable than the market

Short Interest

3.6% of float

Low short interest — market is not heavily bearish

Debt-to-Equity

2.80x

High leverage — significant financial risk

Current Ratio