Zoetis (NYSE:ZTS) Releases Earnings Results, Beats Expectations By $0.24 EPS

Key Points

• Zoetis beat quarterly estimates: EPS was $1.75, topping consensus by $0.24, and revenue of $2.39 billion exceeded forecasts. Revenue nevertheless fell 1.3% year over year.
• Results were mixed across its businesses: Livestock revenue grew 7% and diagnostics rose 13%, while companion-animal revenue declined 5%; dermatology sales fell 16% amid competition and weaker clinic visits.
• Zoetis raised its 2026 profit outlook but expects organic revenue to decline 1%–2%. Management is planning cautiously for 2027, anticipating ongoing competitive pressure and subdued pet-owner spending.

Zoetis (NYSE:ZTS - Get Free Report) posted its quarterly earnings data on Thursday. The company reported $1.75 earnings per share for the quarter, topping the consensus estimate of $1.51 by $0.24, FiscalAI reports. The firm had revenue of $2.39 billion during the quarter, compared to analyst estimates of $2.30 billion. Zoetis had a return on equity of 74.89% and a net margin of 27.49%. The business's quarterly revenue was down 1.3% on a year-over-year basis. During the same period last year, the company posted $1.70 EPS.

Here are the key takeaways from Zoetis' conference call:

• Q3 revenue fell 1% to $2.4 billion, while adjusted net income declined 7%. Adjusted EPS rose 1% to $1.75, helped by share repurchases.
• Companion animal revenue declined 5%, with key dermatology down 16% amid competition, softer clinic visits, and affordability pressures. Promotions slowed U.S. dermatology share loss, but did not stop it.
• Livestock revenue grew 7% on broad-based demand, and companion animal diagnostics rose 13%, providing areas of strength amid weakness in core pet-care franchises.
• Zoetis narrowed its 2026 revenue outlook to an organic decline of 1%–2% and raised adjusted net income guidance to $2.60–$2.64 billion and adjusted EPS guidance to $6.25–$6.35.
• Management said it will plan prudently for 2027, assuming no improvement in macro conditions or pet-owner spending and expecting competitive pressures to persist. Upcoming launches are expected to contribute modestly in 2027, with greater impact later and into 2028.

Zoetis Price Performance

NYSE ZTS traded down $2.61 on Friday, reaching $79.50. 6,023,502 shares of the stock traded hands, compared to its average volume of 3,857,472. The firm's fifty day simple moving average is $75.68 and its 200 day simple moving average is $92.60. The company has a market cap of $32.85 billion, a price-to-earnings ratio of 12.64, a P/E/G ratio of 1.23 and a beta of 0.67. Zoetis has a 12 month low of $68.77 and a 12 month high of $132.49. The company has a quick ratio of 1.84, a current ratio of 3.08 and a debt-to-equity ratio of 2.87.

Zoetis Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, December 1st. Investors of record on Friday, October 30th will be given a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a dividend yield of 2.7%. The ex-dividend date of this dividend is Friday, October 30th. Zoetis's dividend payout ratio is currently 34.93%.

Key Zoetis News

Here are the key news stories impacting Zoetis this week:

• Positive Sentiment: Adjusted EPS of $1.75 topped the $1.51 consensus, while revenue of $2.39 billion exceeded expectations of $2.30 billion. Zoetis also raised its full-year 2026 profit outlook. Zoetis Lifts Annual Outlook While Braces For Cautious Pet Economy
• Positive Sentiment: Livestock revenue grew 7% to $797 million, helping offset softness in companion-animal products. Jefferies also raised its price target to $85 from $83. Zoetis: 3 Key Takeaways for Long-Term Investors
• Negative Sentiment: Investors appear focused on ongoing pressure in the pet-health business: owners are cutting back on veterinary visits, and Zoetis is taking a cautious view of 2027. Competitive pressures and margin headwinds also weigh on the outlook. Zoetis plans cautiously for 2027 as pet owners cut back on vet visits, shares fall ZTS Q3 2026 deep dive: Competitive pressures and margin headwinds weigh on outlook
• Negative Sentiment: Despite beating estimates, quarterly revenue declined 1.3% year over year, reinforcing concerns that strength in livestock may not fully offset weaker companion-animal demand. Zoetis reports third-quarter results

Analyst Ratings Changes

A number of equities analysts have commented on ZTS shares. William Blair cut Zoetis from an "outperform" rating to a "market perform" rating in a report on Thursday, August 6th. Leerink Partners decreased their price objective on Zoetis from $95.00 to $80.00 and set a "market perform" rating for the company in a research report on Monday, July 13th. Citigroup cut their price objective on Zoetis from $112.00 to $96.00 and set a "buy" rating for the company in a research report on Tuesday, August 11th. Weiss Ratings upgraded Zoetis from a "sell (d)" rating to a "sell (d+)" rating in a research note on Thursday, October 29th. Finally, BTIG Research dropped coverage on Zoetis in a research note on Friday, October 30th. They issued a "buy" rating and a $200.00 price target on the stock. Eight equities research analysts have rated the stock with a Buy rating, twelve have issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, Zoetis currently has a consensus rating of "Hold" and a consensus target price of $101.25.

Zoetis Company Profile

Zoetis Inc is a global animal health company that develops, manufactures and markets medicines, vaccines, diagnostics, genetic products and related services for animals. Its offerings support the prevention, diagnosis and treatment of disease in both companion animals, including dogs, cats and horses, and livestock such as cattle, swine, poultry and fish.

The company's product portfolio includes prescription medicines, parasiticides, vaccines, veterinary diagnostics and animal genetics.

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