Animal health company Zoetis (NYSE:ZTS) will be reporting earnings this Thursday before market hours. Here’s what to look for.
Zoetis missed analysts’ revenue expectations last quarter, reporting revenues of $2.47 billion, flat year on year. It was a disappointing quarter for the company, with full-year revenue guidance missing analysts’ expectations significantly and a significant miss of analysts’ full-year EPS guidance estimates.
Is Zoetis a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Zoetis’s revenue to decline 3.8% year on year, a reversal from the 1.4% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Zoetis has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Zoetis’s peers in the branded pharmaceuticals segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Eli Lilly delivered year-on-year revenue growth of 38.6%, beating analysts’ expectations by 7.9%, and Pfizer reported flat revenue, topping estimates by 4.6%. Eli Lilly traded up 9.8% following the results.
Read our full analysis of Eli Lilly’s results here and Pfizer’s results here.
There has been positive sentiment among investors in the branded pharmaceuticals segment, with share prices up 2.8% on average over the last month. Zoetis is up 13.9% during the same time and is heading into earnings with an average analyst price target of $88.38 (compared to the current share price of $81.35).
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