Zoetis Drops As 2025 Guidance Falls Short Of Estimates

Zinger Key Points

Zoetis Q4 adjusted EPS rose to $1.40, beating estimates of $1.34, with sales of $2.32B, up 5%. Organic operational growth hit 9%.
2025 guidance projects revenue of $9.225B–$9.375B, with organic operational growth of 6%-8%.
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On Thursday, Zoetis Inc ZTS reported a fourth-quarter 2024 adjusted EPS of $1.40, up from $1.24 a year ago, beating the consensus of $1.34.

Adjusted net income for the fourth quarter of 2024 was $632 million, an increase of 11% on a reported basis and an increase of 9% on an operational basis.

The animal health firm reported sales of $2.32 billion, up 5%, inline with the consensus.

On an operational basis, revenue for the fourth quarter of 2024 increased by 6% compared with the fourth quarter of 2023.

In October 2024, Zoetis divested its medicated feed additive (MFA) product portfolio, certain water-soluble products, and related assets.

Excluding the impact of all divested products and foreign exchange, for the fourth quarter of 2024, the organic operational growth rate was 9% and 12% for fiscal year 2024.

"We achieved 11% revenue growth in the U.S. and 10% operational revenue growth internationally, marking significant revenue milestones, and our companion animal and livestock portfolios saw strong operational revenue growth, 14% and 5%, respectively,” said Kristin Peck, chief executive officer of Zoetis.

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Guidance: Zoetis expects full-year 2025 revenues of $9.225 billion—$9.375 billion (operational growth of 2%- 4%; organic operational growth of 6% to 8%) versus the consensus of $9.574 billion.

“As we approach 2025, we are eager to continue the momentum we realized in 2024, and we are confident that the drivers of our success are sustainable, positioning us for continued above-market growth this year and beyond. We are guiding to full-year organic operational growth of 6% to 8% in revenue in 2025,” Peck said.

The company expects a reported net income of $2.57 billion—$2.62 billion, with adjusted net income between $2.700 billion and $2.750 billion (operational growth of 2% to 4%; organic operational growth of 6% to 8%).

Zoetis forecasts a reported EPS of $5.70-$5.80 and adjusted EPS between $6.00 and $6.10, compared to a consensus of $6.29.

Price Action: ZTS stock is down 10% at $156.17 at last check Thursday.

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