ZTS - Embedded Expectations Analysis - 2020 11 10
Zoetis Inc. (ZTS:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 39.3x Uniform P/E, implying bullish expectations for the firm. Also, management is confident about their livestock business, virtual productivity, and Pumpkin's performanceSpecifically, management is confident in the sustainability of growth of the livestock business and in their ability to maintain productivity. Additionally, they are confident in their ability to do virtual seminars and handle orders by phone during this pandemic. They are also confident the combination of Elanco and Bayer will not dramatically change the competitive landscape, that traveling less will benefit them in the future, and in livestock producers' ability to adjust to grocery and retail channels. Management is also confident in the sustainability of performance for Pumpkin, their newly launched pet insurance
Zoetis is a holding company. Through its subsidiaries, the company is engaged in the discovery, development, manufacture and commercialization of animal health medicines, vaccines, and diagnostic products with a focus on both livestock and companion animals. The company operates in two segments: the United States and International. The company's main product categories are vaccines, anti-infectives, parasiticides, other pharmaceutical products, dermatology products, medicated feed additives, and animal health diagnostics. The company's other non-pharmaceutical product categories include nutritionals and agribusiness, as well as products and services including biodevices, genetic tests and precision livestock farming.
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