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Zoetis Stock Rises 15% in 3 Months: Time to Add to Your Portfolio?
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Shares of Zoetis (ZTS - Free Report) have risen 15.4% in the past three months compared with the industry’s 9.3% growth. The stock has also outperformed the sector as well as the S&P 500 as seen in the chart below. The stock is also trading above both its 50 and 200-day moving averages from early August.
ZTS Stock Outperforms Industry, Sector & S&P 500
Image Source: Zacks Investment Research
Zoetis is a major player in the animal health market. The company operates in eight major product categories: vaccines, anti-infectives, parasiticides, dermatology, other pharmaceutical products, pain and sedation, medicated feed additives and animal health diagnostics.
Zoetis’ diversified product portfolio caters to eight core species, namely, cattle, swine, poultry, fish and sheep (collectively, livestock) and dogs, cats and horses (collectively, companion animals).
Let’s delve deeper to discuss four reasons why adding Zoetis stock to your portfolio may prove beneficial in 2024.
ZTS’ New Products Deliver Strong Performance
Zoetis has built a very strong companion animal portfolio over the last several years based on its internal innovation, which contributes significantly to the top line. Key dermatology products (Apoquel and Cytopoint), new products (such as Simparica and Stronghold Plus) and increased medicalization rates in key international markets are propelling further growth. Zoetis has also received the FDA’s approval for ProHeart 12 (moxidectin), which is the industry’s only once-yearly injection to prevent heartworm disease in dogs aged 12 months or older.
Last year, the regulatory body approved Apoquel Chewable tablets in the United States for controlling pruritus related to allergic dermatitis and control of atopic dermatitis in dogs at least 12 months of age. Zoetis’ Apoquel Chewable is an easier-to-use formulation that has enhanced medication compliance and, therefore, improved outcomes for dogs. Hence, the demand is strong.
The approval of Simparica Trio in Europe and the United States has strengthened the company’s market-leading parasiticide portfolio for companion animals. The uptake of the product has been strong. ZTS also continues to bolster its vaccine portfolio for livestock.
Zoetis received approval for Rimadyl (carprofen) for dogs in China, which is one of the fastest-growing companion animal markets in the world. It is indicated for relief from pain and inflammation associated with osteoarthritis (chewables) and control of postoperative pain related to soft tissue and orthopedic surgeries (injectables).
The uptake of Librela and Solensia, the company’s new monoclonal antibody therapies for osteoarthritis pain in dogs and cats, is also positive and expected to continue to boost growth in upcoming quarters. Approval of other innovative products in the future, along with continued uptake of its existing products, should further boost sales in the quarters ahead.
ZTS Drives Growth Through Strategic Acquisitions
Zoetis has also been expanding its business through acquisitions. Such expansion initiatives bode well for the company, strengthening its position in the animal healthcare market.
During the third quarter of 2023, the company acquired two privately held research and development stage animal health biopharmaceutical companies, PetMedix Ltd. and adivo GmbH. PetMedix develops antibody-based therapeutics for companion animals. This acquisition is expected to strengthen Zoetis’ companion animal products portfolio.
In early 2024, Zoetis expanded the capabilities of its multi-application diagnostics platform, Vetscan Imagyst, to include AI Urine Sediment analysis. This new feature facilitates accurate, in-clinic sediment analysis of fresh urine, allowing veterinarians to make treatment decisions quickly.
Vetscan Imagyst is the first and only AI-driven diagnostics technology to provide five applications in a single platform, offering analysis at the point of care. The AI-driven nature of this additional feature offers veterinarians fast, consistent and accurate results to devise individualized treatment plans that benefit both pets and pet owners.
This new additional feature broadens the already existing wide range of high-value, in-clinic diagnostics offered by Vetscan Imagyst, thus facilitating better treatment.
The stock is currently trading at a premium to the industry, as seen in the chart below. However, it might be prudent to add ZTS to your portfolio despite the premium valuation, as the company's strong fundamentals will generate lucrative returns in the future.
Image Source: Zacks Investment Research
In the past 60 days, the Zacks Consensus Estimate for Zoetis’ 2024 earnings per share (EPS) has increased from $5.76 to $5.83. During the same time frame, the consensus estimate for ZTS’ 2025 EPS has increased from $6.32 to $6.42.
Image Source: Zacks Investment Research
Consistently rising earnings estimates highlight analysts’ optimistic outlook for further growth.
ZTS Boosts Shareholder Value With Increased Dividends
Zoetis has been consistently increasing dividends for shareholders, which is another lucrative reason to add the stock to your portfolio. ZTS’ board declared a dividend of $0.432 per share for the third quarter of 2024, representing an increase of 15% from the quarterly dividend rate paid in 2023.
In the past 60 days, estimates for Illumina’s 2024 EPS have moved up from $1.84 to $3.62. The consensus estimate for 2025 earnings has improved from $3.22 to $4.43. In the past three months, shares of ILMN have gained 20.5%.
ILMN’s earnings beat estimates in each of the trailing four quarters, the average surprise being 463.46%.
In the past 60 days, estimates for Krystal Biotech’s 2024 EPS have increased from $2.09 to $2.38. The consensus estimate for 2025 earnings has improved from $4.33 to $7.31. In the past three months, shares of KRYS have jumped 9.4%.
KRYS’ earnings beat estimates in three of the trailing four quarters while missing on the remaining occasion, the average surprise being 45.95%.
In the past 60 days, estimates for Fulcrum Therapeutics’ 2024 loss per share have narrowed from $1.24 to 33 cents. The consensus estimate for 2025 loss per share has narrowed from $1.71 to $1.14. In the past three months, shares of FULC have plunged 46.2%.
FULC’s earnings beat estimates in each of the trailing four quarters, the average surprise being 393.18%.
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Zoetis Stock Rises 15% in 3 Months: Time to Add to Your Portfolio?
Shares of Zoetis (ZTS - Free Report) have risen 15.4% in the past three months compared with the industry’s 9.3% growth. The stock has also outperformed the sector as well as the S&P 500 as seen in the chart below. The stock is also trading above both its 50 and 200-day moving averages from early August.
ZTS Stock Outperforms Industry, Sector & S&P 500
Zoetis is a major player in the animal health market. The company operates in eight major product categories: vaccines, anti-infectives, parasiticides, dermatology, other pharmaceutical products, pain and sedation, medicated feed additives and animal health diagnostics.
Zoetis’ diversified product portfolio caters to eight core species, namely, cattle, swine, poultry, fish and sheep (collectively, livestock) and dogs, cats and horses (collectively, companion animals).
Let’s delve deeper to discuss four reasons why adding Zoetis stock to your portfolio may prove beneficial in 2024.
ZTS’ New Products Deliver Strong Performance
Zoetis has built a very strong companion animal portfolio over the last several years based on its internal innovation, which contributes significantly to the top line. Key dermatology products (Apoquel and Cytopoint), new products (such as Simparica and Stronghold Plus) and increased medicalization rates in key international markets are propelling further growth. Zoetis has also received the FDA’s approval for ProHeart 12 (moxidectin), which is the industry’s only once-yearly injection to prevent heartworm disease in dogs aged 12 months or older.
Last year, the regulatory body approved Apoquel Chewable tablets in the United States for controlling pruritus related to allergic dermatitis and control of atopic dermatitis in dogs at least 12 months of age. Zoetis’ Apoquel Chewable is an easier-to-use formulation that has enhanced medication compliance and, therefore, improved outcomes for dogs. Hence, the demand is strong.
The approval of Simparica Trio in Europe and the United States has strengthened the company’s market-leading parasiticide portfolio for companion animals. The uptake of the product has been strong. ZTS also continues to bolster its vaccine portfolio for livestock.
Zoetis received approval for Rimadyl (carprofen) for dogs in China, which is one of the fastest-growing companion animal markets in the world. It is indicated for relief from pain and inflammation associated with osteoarthritis (chewables) and control of postoperative pain related to soft tissue and orthopedic surgeries (injectables).
The uptake of Librela and Solensia, the company’s new monoclonal antibody therapies for osteoarthritis pain in dogs and cats, is also positive and expected to continue to boost growth in upcoming quarters. Approval of other innovative products in the future, along with continued uptake of its existing products, should further boost sales in the quarters ahead.
ZTS Drives Growth Through Strategic Acquisitions
Zoetis has also been expanding its business through acquisitions. Such expansion initiatives bode well for the company, strengthening its position in the animal healthcare market.
During the third quarter of 2023, the company acquired two privately held research and development stage animal health biopharmaceutical companies, PetMedix Ltd. and adivo GmbH. PetMedix develops antibody-based therapeutics for companion animals. This acquisition is expected to strengthen Zoetis’ companion animal products portfolio.
In early 2024, Zoetis expanded the capabilities of its multi-application diagnostics platform, Vetscan Imagyst, to include AI Urine Sediment analysis. This new feature facilitates accurate, in-clinic sediment analysis of fresh urine, allowing veterinarians to make treatment decisions quickly.
Vetscan Imagyst is the first and only AI-driven diagnostics technology to provide five applications in a single platform, offering analysis at the point of care. The AI-driven nature of this additional feature offers veterinarians fast, consistent and accurate results to devise individualized treatment plans that benefit both pets and pet owners.
This new additional feature broadens the already existing wide range of high-value, in-clinic diagnostics offered by Vetscan Imagyst, thus facilitating better treatment.
ZTS’ Zacks Rank, Premium Valuation & Rising Estimates
Zoetis currently carries a Zacks Rank #2 (Buy).
The stock is currently trading at a premium to the industry, as seen in the chart below. However, it might be prudent to add ZTS to your portfolio despite the premium valuation, as the company's strong fundamentals will generate lucrative returns in the future.
In the past 60 days, the Zacks Consensus Estimate for Zoetis’ 2024 earnings per share (EPS) has increased from $5.76 to $5.83. During the same time frame, the consensus estimate for ZTS’ 2025 EPS has increased from $6.32 to $6.42.
Consistently rising earnings estimates highlight analysts’ optimistic outlook for further growth.
ZTS Boosts Shareholder Value With Increased Dividends
Zoetis has been consistently increasing dividends for shareholders, which is another lucrative reason to add the stock to your portfolio. ZTS’ board declared a dividend of $0.432 per share for the third quarter of 2024, representing an increase of 15% from the quarterly dividend rate paid in 2023.
Other Stocks to Consider
Some other top-ranked stocks in the biotech sector are Illumina, Inc. (ILMN - Free Report) , Krystal Biotech, Inc. (KRYS - Free Report) and Fulcrum Therapeutics, Inc. (FULC - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for Illumina’s 2024 EPS have moved up from $1.84 to $3.62. The consensus estimate for 2025 earnings has improved from $3.22 to $4.43. In the past three months, shares of ILMN have gained 20.5%.
ILMN’s earnings beat estimates in each of the trailing four quarters, the average surprise being 463.46%.
In the past 60 days, estimates for Krystal Biotech’s 2024 EPS have increased from $2.09 to $2.38. The consensus estimate for 2025 earnings has improved from $4.33 to $7.31. In the past three months, shares of KRYS have jumped 9.4%.
KRYS’ earnings beat estimates in three of the trailing four quarters while missing on the remaining occasion, the average surprise being 45.95%.
In the past 60 days, estimates for Fulcrum Therapeutics’ 2024 loss per share have narrowed from $1.24 to 33 cents. The consensus estimate for 2025 loss per share has narrowed from $1.71 to $1.14. In the past three months, shares of FULC have plunged 46.2%.
FULC’s earnings beat estimates in each of the trailing four quarters, the average surprise being 393.18%.