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Zoetis' (ZTS) Q4 Earnings in Line With Estimates, Revenues Beat
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Zoetis Inc. (ZTS - Free Report) posted fourth-quarter 2022 adjusted earnings (excluding one-time items) of $1.15, which was in line with the Zacks Consensus Estimate. In the year-ago quarter, the company reported earnings of $1.00.
Total revenues grew 4% year over year to $2.04 billion, which beat the Zacks Consensus Estimate of $2.01 billion.
Shares of Zoetis were up in the pre-market trading session on Tuesday. The stock has fallen 13.8% in the trailing 12 months compared with the industry’s 15.2% decline.
Image Source: Zacks Investment Research
Quarterly Highlights
Zoetis derives the majority of its revenues from a diversified product portfolio of medicines and vaccines used to treat and protect livestock and companion animals. The company reports business results under two geographical operating segments — the United States and International.
Revenues from the U.S. segment increased 7% year over year to $1.11 billion for the fourth quarter. Sales of companion animal products in this region grew 12% from the prior-year quarter, primarily driven by higher sales of Simparica Trio, the triple-combination parasiticide for dogs. The Apoquel and Cytopoint brands in the dermatology portfolio also contributed to this increase. However, sales of livestock products decreased 6% year over year for the quarter due to a decrease in cattle product sales as a result of supply re-stocking in the third quarter of 2022 and generic competition for Draxxin.
Sales of swine products declined year over year. Also, sales of poultry products declined for the quarter due to the expanded use of lower-cost alternatives of premium products in addition to generic competition.
Revenues in the International segment were flat on a reported basis but increased 12% year over year on an operational basis to $901 million. Sales of companion animal products grew 7% on a reported and 21% on an operational basis. On a year-over-year basis, livestock product sales declined 7% on a reported basis and increased 4% operationally. While sales of poultry products increased because of market expansion in several key geographies, sales of swine products declined due to supply constraints.
The growth resulted from increased sales of Zoetis’ parasiticides portfolio, including the Simparica and Revolution franchises, the key dermatology portfolio consisting of both Apoquel and Cytopoint brands as well as the recently launched chewable version of Apoquel. The company’s monoclonal antibody products for osteoarthritis pain, Librela for dogs and Solensiafor cats, also contributed to growth in the reported quarter. Growth of the company’s fish portfolio was driven primarily by increased sales of vaccines across key salmon markets, including Norway and Chile.
Full-Year 2022 Results
Zoetis posted 2022 adjusted earnings of $4.88 per share (excluding one-time items), which increased from the year-ago figure of $4.70 and beat the Zacks Consensus Estimate of $4.87.
Total revenues grew 4% year over year to $8.1 billion, which beat the Zacks Consensus Estimate of $8.05 billion.
2023 Guidance
Zoetis issued its guidance for 2023.
The company expects adjusted earnings in the range of $5.34-$5.44 per share.
Revenues are projected between $8.575 billion and $8.725 billion.
Our Take
Zoetis exceeded fourth-quarter sales estimates, driven by the strong uptake of companion animal portfolio products, while earnings per share were at par with the estimates. ZTS expects to continue witnessing revenue growth, driven by the persistent strength of the pet care portfolio, key dermatology products, ongoing expansion in markets outside the United States and the acceleration of its diagnostics portfolio penetration.
In the past 90 days, the estimate for EQRx’s 2022 loss per share has narrowed from 53 cents to 50 cents. During the same period, the loss estimate per share for 2023 has narrowed from 71 cents to 66 cents. In the past year, the shares of EQRx have decreased by 33%.
EQRX delivered an average four-quarter earnings surprise of 22.10%. In the last reported quarter, it delivered an earnings surprise of 14.29%.
In the past 90 days, the estimate for AlloVir’s 2022 loss per share has narrowed from $2.28 to $2.24. During the same period, the loss estimate per share for 2023 has narrowed from $2.19 to $2.10. In the past year, the shares of AlloVir have decreased by 30.1%.
ALVR witnessed an average loss surprise of 4.39% but reported an earnings surprise in three out of four estimates in the trailing four reported quarters.
In the past 90 days, the estimate for Altimmune’s 2022 loss per share has narrowed from $1.89 to $1.87. During the same period, the loss estimate per share for 2023 has narrowed from $2.18 to $2.10. In the past year, the shares of Altimmune have increased by 62.2%.
ALT’s earnings witnessed an average earnings surprise of 13.74%, beating all four estimates in the trailing four reported quarters.
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Zoetis' (ZTS) Q4 Earnings in Line With Estimates, Revenues Beat
Zoetis Inc. (ZTS - Free Report) posted fourth-quarter 2022 adjusted earnings (excluding one-time items) of $1.15, which was in line with the Zacks Consensus Estimate. In the year-ago quarter, the company reported earnings of $1.00.
Total revenues grew 4% year over year to $2.04 billion, which beat the Zacks Consensus Estimate of $2.01 billion.
Shares of Zoetis were up in the pre-market trading session on Tuesday. The stock has fallen 13.8% in the trailing 12 months compared with the industry’s 15.2% decline.
Image Source: Zacks Investment Research
Quarterly Highlights
Zoetis derives the majority of its revenues from a diversified product portfolio of medicines and vaccines used to treat and protect livestock and companion animals. The company reports business results under two geographical operating segments — the United States and International.
Revenues from the U.S. segment increased 7% year over year to $1.11 billion for the fourth quarter. Sales of companion animal products in this region grew 12% from the prior-year quarter, primarily driven by higher sales of Simparica Trio, the triple-combination parasiticide for dogs. The Apoquel and Cytopoint brands in the dermatology portfolio also contributed to this increase. However, sales of livestock products decreased 6% year over year for the quarter due to a decrease in cattle product sales as a result of supply re-stocking in the third quarter of 2022 and generic competition for Draxxin.
Sales of swine products declined year over year. Also, sales of poultry products declined for the quarter due to the expanded use of lower-cost alternatives of premium products in addition to generic competition.
Revenues in the International segment were flat on a reported basis but increased 12% year over year on an operational basis to $901 million. Sales of companion animal products grew 7% on a reported and 21% on an operational basis. On a year-over-year basis, livestock product sales declined 7% on a reported basis and increased 4% operationally. While sales of poultry products increased because of market expansion in several key geographies, sales of swine products declined due to supply constraints.
The growth resulted from increased sales of Zoetis’ parasiticides portfolio, including the Simparica and Revolution franchises, the key dermatology portfolio consisting of both Apoquel and Cytopoint brands as well as the recently launched chewable version of Apoquel. The company’s monoclonal antibody products for osteoarthritis pain, Librela for dogs and Solensiafor cats, also contributed to growth in the reported quarter. Growth of the company’s fish portfolio was driven primarily by increased sales of vaccines across key salmon markets, including Norway and Chile.
Full-Year 2022 Results
Zoetis posted 2022 adjusted earnings of $4.88 per share (excluding one-time items), which increased from the year-ago figure of $4.70 and beat the Zacks Consensus Estimate of $4.87.
Total revenues grew 4% year over year to $8.1 billion, which beat the Zacks Consensus Estimate of $8.05 billion.
2023 Guidance
Zoetis issued its guidance for 2023.
The company expects adjusted earnings in the range of $5.34-$5.44 per share.
Revenues are projected between $8.575 billion and $8.725 billion.
Our Take
Zoetis exceeded fourth-quarter sales estimates, driven by the strong uptake of companion animal portfolio products, while earnings per share were at par with the estimates. ZTS expects to continue witnessing revenue growth, driven by the persistent strength of the pet care portfolio, key dermatology products, ongoing expansion in markets outside the United States and the acceleration of its diagnostics portfolio penetration.
Zoetis Inc. Price, Consensus and EPS Surprise
Zoetis Inc. price-consensus-eps-surprise-chart | Zoetis Inc. Quote
Zacks Rank & Stocks to Consider
Zoetis currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the drug/biotech sector include EQRx, Inc. , AlloVir, Inc. (ALVR - Free Report) and Altimmune, Inc. (ALT - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past 90 days, the estimate for EQRx’s 2022 loss per share has narrowed from 53 cents to 50 cents. During the same period, the loss estimate per share for 2023 has narrowed from 71 cents to 66 cents. In the past year, the shares of EQRx have decreased by 33%.
EQRX delivered an average four-quarter earnings surprise of 22.10%. In the last reported quarter, it delivered an earnings surprise of 14.29%.
In the past 90 days, the estimate for AlloVir’s 2022 loss per share has narrowed from $2.28 to $2.24. During the same period, the loss estimate per share for 2023 has narrowed from $2.19 to $2.10. In the past year, the shares of AlloVir have decreased by 30.1%.
ALVR witnessed an average loss surprise of 4.39% but reported an earnings surprise in three out of four estimates in the trailing four reported quarters.
In the past 90 days, the estimate for Altimmune’s 2022 loss per share has narrowed from $1.89 to $1.87. During the same period, the loss estimate per share for 2023 has narrowed from $2.18 to $2.10. In the past year, the shares of Altimmune have increased by 62.2%.
ALT’s earnings witnessed an average earnings surprise of 13.74%, beating all four estimates in the trailing four reported quarters.