NYSE$ZTS

Zoetis · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Reported revenue of $1.8 billion, growing 13%, and net income of $479 million, or $1.00 per diluted share, both increasing 11% for the third quarter of 2020.

Zoetis reported a strong third quarter in 2020, with revenue reaching $1.8 billion, a 13% increase compared to the previous year. Net income also saw an 11% increase, amounting to $479 million, or $1.00 per diluted share. The company's companion animal business was a key driver of growth, and livestock also contributed positively, especially in the U.S. cattle and China's swine markets. Due to the strong performance, Zoetis is increasing its full-year guidance for 2020.

  • Revenue reached $1.8 billion, a 13% increase year-over-year.
  • Net income increased by 11% to $479 million, or $1.00 per diluted share.
  • Adjusted net income was $524 million, or $1.10 per diluted share.
  • Companion animal products, particularly Simparica Trio and key dermatology products, drove sales growth.

Headline financials

Total Revenue

$1.79B

Previous: $1.58B+12.8%
EPS (adj)

$1.10

Previous: $0.94+17.0%
Companion Animal Growth

20.0%

No prior period
Livestock Growth

9.0%

No prior period
U.S. Revenue Growth

18.0%

No prior period
International Revenue Growth

11.0%

No prior period
Capital Expenditures

-$301M

Previous: -$294M-2.4%
Free Cash Flow

$178M

Previous: $139M+28.1%
Net Income

$479M

Previous: $433M+10.6%
Operating Income

$629M

Previous: $459M+37.0%
Gross Profit

$1.24B

Previous: $1.11B+12.2%
Cash & Equivalents

$3.65B

Previous: $1.82B+101.3%
Total Assets

$13.7B

Previous: $11.3B+21.8%
Stock-Based Comp

$14M

Previous: $16M-12.5%

Revenue & EPS history

Zoetis · Revenue · Quarterly

$1.79B

Q3 2020+12.8%vs Q3 2019
Beat estimate in 16 of 16 quarters(100%)
ActualEstimate

Revenue by segment

Zoetis · $1.79B total across 3 segments · Q3 2020

  • Companion Animal
    $995M+19.3%
  • Livestock
    $768M+5.1%
  • Contract Mfg & Human Health
    $23M+21.1%

Forward guidance

Zoetis is increasing its full year 2020 guidance, including revenue between $6.550 billion and $6.625 billion, reported diluted EPS between $3.38 and $3.45, adjusted diluted EPS between $3.76 and $3.81.

Tailwinds

  • Revenue between $6.550 billion and $6.625 billion
  • Operational growth 7% to 8%
  • Adjusted cost of sales as a percentage of revenue approximately 30%
  • Adjusted SG&A expenses $1.615 to $1.645 billion
  • Adjusted R&D expenses $455 to $465 million

Headwinds

  • Adjusted interest expense and other (income)/deductions-net approximately $250 million
  • Effective tax rate on adjusted income 19% to 20%
  • Adjusted diluted EPS $3.76 to $3.81
  • Adjusted net income $1.790 to $1.825 billion
  • Operational growth 6% to 8%

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

+0.4%

Avg return

Earnings day

-0.6%

Avg return

5 days after

+0.5%

Avg return

30 days after

55%

32 / 58 earnings

Positive

+8.1%

Q4 2018

Best reaction

-13.7%

Q3 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.2%-30.9%-28.5%
Q4 2025-2.4%-2.4%-10.1%
Q3 2025-13.7%-16.7%-16.6%
Q2 2025-3.7%-2.9%+0.9%
Q1 2025-5.3%+0.8%+6.7%
Q4 2024-5.1%-10.0%-7.3%
Q3 2024-3.7%-2.8%-3.6%
Q2 2024+5.7%+6.0%+6.7%
Q1 2024+5.4%+6.3%+7.0%
Q4 2023-6.4%-4.2%-11.6%
Q3 2023+7.1%+10.4%+18.3%
Q2 2023+4.8%+5.6%+3.9%
Q1 2023+4.8%+3.7%-3.3%
Q4 2022+7.3%+5.4%+1.9%
Q3 2022-9.3%-7.6%+6.8%
Q2 2022-3.1%-5.9%-12.9%
Q1 2022-4.3%-8.0%-4.4%
Q4 2021-0.7%-2.6%-1.4%
Q3 2021+2.7%+4.3%+5.8%
Q2 2021-1.4%-2.9%+2.4%
Q1 2021-1.3%-2.1%+0.8%
Q4 2020+1.3%-4.0%-8.6%
Q3 2020-2.9%-6.8%-9.4%
Q2 2020+0.7%-0.5%-0.3%
Q1 2020-5.4%-3.7%+7.4%
Q4 2019+0.8%+0.5%-12.2%
Q3 2019-3.0%-3.5%+0.2%
Q2 2019+7.4%+11.1%+13.8%
Q1 2019+1.9%-0.4%-0.7%
Q4 2018+8.1%+7.5%+9.8%
Q3 2018+2.9%+2.9%+4.1%
Q2 2018+6.5%+7.5%+5.3%
Q1 2018-3.6%-1.5%+2.4%
Q4 2017+7.1%+7.9%+13.6%
Q3 2017+6.5%+6.1%+12.1%
Q2 2017-1.6%-3.4%+4.9%
Q1 2017+7.0%+6.9%+12.4%
Q4 2016-4.8%-3.0%-2.1%
Q3 2016+3.6%+5.8%+3.9%
Q2 2016+3.4%+2.2%+3.1%
Q1 2016+0.2%
Q4 2015+3.4%
Q3 2015+5.2%
Q2 2015+0.3%
Q1 2015-0.2%
Q4 2014+4.3%
Q3 2014+4.1%
Q2 2014-2.8%
Q1 2014+0.4%
Q4 2011+0.1%
Q4 2013-3.7%
Q3 2012-0.5%
Q3 2013-2.1%
Q2 2012-1.4%
Q2 2013-0.0%
Q1 2012+0.9%
Q4 2012+0.9%
Q1 2013+2.2%
Q3 2011
Q2 2011
Q1 2011

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