What is Zoetis Inc. (ZTS) DCF Fair Value and Intrinsic Value in 2026?

Zoetis Inc. (ZTS) intrinsic value is calculated using conservative multi-stage Discounted Cash Flow (DCF) models, 5-year free cash flow trajectories, Graham Numbers, and owner earnings multiples. LocalAlpha tracks real-time margin of safety against live market prices.

What is Zoetis Inc.'s historical Return on Invested Capital (ROIC) and Moat Rating?

Zoetis Inc. operates in the Healthcare sector (Drug Manufacturers - Specialty & Generic) with an economic moat rating of WIDE. LocalAlpha tracks 5-year audited quarterly ROIC, operating margin stability, and balance sheet solvency ratios.

What is Zoetis Inc.'s financial health rating and Piotroski F-Score?

Zoetis Inc.'s balance sheet quality is evaluated using the 9-point Piotroski F-Score, Altman Z-Score solvency model, debt-to-equity ratio, and quick/current liquidity coverage to guard against financial distress.

How does LocalAlpha monitor Zoetis Inc. (ZTS) for quarterly SEC filing thesis breaks?

LocalAlpha audits Zoetis Inc.'s 10-K, 10-Q, and 8-K regulatory filings on SEC EDGAR within 15 minutes of release. If reported metrics breach an investor's custom ROIC floor, operating margin boundary, or qualitative risk criteria, an autonomous breach audit is dispatched immediately.

StocksZTS

ZTS

Zoetis Inc.Healthcare / Drug Manufacturers - Specialty & GenericINTACT

Zoetis Inc. engages in the discovery, development, manufacture, and commercialization of medicines, vaccines, diagnostic products and services, biodevices, genetic tests, and precision animal health solutions for the animal health industry in the United States and internationally. The company commercializes products primarily across companion animals comprising dogs, cats, and horses; and species, including livestock, such as cattle, swine, poultry, fish, and sheep. It also offers parasiticides, vaccines, dermatology, anti-infectives, pain and sedation, other pharmaceutical, and animal health diagnostics. In addition, the company provides animal health diagnostics, including point-of-care diagnostic products, instruments and reagents, rapid immunoassay tests, reference laboratory kits and services, and blood glucose monitors; and other non-pharmaceutical products, which include nutritionals, as well as products and services in biodevices, genetic tests, and precision animal health. It markets its products to veterinarians, livestock producers, and pet owners. The company has collaborated with Blacksmith Medicines, Inc. to discover and develop novel antibiotics for animal health. Zoetis Inc. was incorporated in 2012 and is headquartered in Parsippany, New Jersey.

Share Price

$72.97

52W: $71 - $150.05

DCF Fair Value

$137.55

+47% MoS

Thesis Hub

P/E (TTM)

11.9x

ROIC

30.5%

Operating Margin

40.7%

FCF Yield

6.7%

Debt / Equity

2.94x

Piotroski Score

7/9

Altman Z-Score

3.6

Market Cap

$30.2B

Price vs. Intrinsic Value Corridor

Margin of Safety Buy Zone (<25% Discount)

Historical market price overlaid against conservative DCF Fair Value & Benjamin Graham Margin of Safety bands.

Period Return (1Y)

—()

Period Range

$— - $—

DCF Fair Value

$137.55

MOS Buy Target (-25%)

$103.16

Valuation Overlays: DCF Fair Value ($137.55) 25% MOS Buy Target ($103.16) Revised Graham ($216.34) Graham Number ($32.88)

2-Stage Discounted Cash Flow (DCF) Workbench

Conservative intrinsic value model based on owner cash generation over a 10-year investment horizon. Opens with LocalAlpha's baseline assumptions (matching the fair value shown above) — adjust any input to stress-test.

Current Market Price

$72.97

DCF Fair Value

$137.57

+47% MoS

Starting Free Cash Flow ($M)$2,017M

$100M$2,017M (Reported)$50,000M

Stage 1 Growth (Years 1-5)18.0%

-5%10% (Target)35%

Stage 2 Growth (Years 6-10)4.5%

0%5%20%

Discount Rate (WACC / Hurdle)9.0%

6%9% (Standard)15% (High Risk)

Terminal Perpetual Growth2.5%

1% (GDP Floor)2.5% (Inflation)4.0%

Net Debt ($M)$7,600M

-$100B CashBalance Sheet+$150B Debt

10-Yr PV of Cash Flows

$26.1B

PV of Terminal Value

$38.3B

Implied Enterprise Value

$64.4B

Implied Equity Value

$56.8B

Year	Yr 1	Yr 2	Yr 3	Yr 4	Yr 5	Yr 6	Yr 7	Yr 8	Yr 9	Yr 10
Projected FCF ($M)	$2,380	$2,808	$3,314	$3,911	$4,614	$4,822	$5,039	$5,266	$5,503	$5,750
Present Value (PV)	$2,184	$2,364	$2,559	$2,770	$2,999	$2,875	$2,757	$2,643	$2,534	$2,429

Benjamin Graham & Buffett Value Models

Classical deep value metrics based on asset backing, normalized earnings power, and owner cash yield.

Graham Number-121.9% Premium

$32.88

Calculated as √(22.5 × EPS × BVPS). The maximum theoretical price a defensive investor should pay based purely on asset book value and current earnings.

EPS: $6.13BVPS: $7.84

Revised Graham Formula+66.3% MoS

$216.34

Formula: V = (EPS × (8.5 + 2g) × 4.4) / Y where g is the conservative 7-10 yr growth rate and Y is AAA Bond Yield.

Growth Rate (g%)

Bond Yield (Y%)

Buffett Owner Earnings6.4% Yield

$4.64 / share

True distributable cash flow: Net Income + D&A - Maintenance CapEx. Reflects the cash Buffett would extract without hurting unit volume.

Total: $1.9BYield: 6.4%

Reverse DCF: Market Growth Expectation

EXTREMELY LOW BARRIER

1.8% CAGR (Next 10 Yrs)

At the current price of $72.97, the market is assuming the business will compound Free Cash Flow at 1.8% per year for the next decade with a 9% hurdle rate.

Value Investor Verdict

✓ Low market hurdle: Easy for a wide-moat compounder to beat.

Autonomous Thesis Underwriting

Surveil ZTS with Mathematical Margin of Safety Rules

Set non-negotiable floor rules for Zoetis Inc.. If a newly filed quarterly 10-Q breaks your ROIC floor, operating margin boundary, or balance sheet leverage rules, receive an autonomous breach audit within 15 minutes.

Buffett Quality

ROIC > 15% • Margin > 15% • D/E < 0.5x

Margin Floor Guard

Current Margin 40.7% • Floor > 10%

Solvency Guard

Altman-Z > 2.6 • Current Ratio > 1.5x

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Frequently Asked Questions: Zoetis Inc. (ZTS) Intrinsic Valuation

Audited fundamentals, DCF intrinsic value sensitivity, and thesis break detection parameters for Zoetis Inc..

Based on institutional multi-stage Discounted Cash Flow (DCF) modeling on audited SEC cash flows, Zoetis Inc. has an estimated DCF intrinsic fair value of $137.55 per share compared to its current market price of $72.97. This represents an estimated 47.0% margin of safety (trading below fair value). Additionally, its classic Benjamin Graham Number stands at $32.88.