Critical Review: Zoetis (ZTS) and Phibro Animal Health Corporation (PAHC)
Zoetis (NYSE: ZTS) and Phibro Animal Health Corporation (NASDAQ:PAHC) are both medical companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitabiliy, dividends, valuation, analyst recommendations and institutional ownership.
This is a breakdown of current ratings and recommmendations for Zoetis and Phibro Animal Health Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Phibro Animal Health Corporation||2||2||2||0||2.00|
Zoetis presently has a consensus target price of $61.94, indicating a potential downside of 1.68%. Phibro Animal Health Corporation has a consensus target price of $28.80, indicating a potential downside of 21.53%. Given Zoetis’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Zoetis is more favorable than Phibro Animal Health Corporation.
This table compares Zoetis and Phibro Animal Health Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Phibro Animal Health Corporation||8.49%||54.68%||10.12%|
Insider & Institutional Ownership
98.1% of Zoetis shares are held by institutional investors. Comparatively, 47.6% of Phibro Animal Health Corporation shares are held by institutional investors. 0.3% of Zoetis shares are held by insiders. Comparatively, 48.1% of Phibro Animal Health Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Zoetis pays an annual dividend of $0.42 per share and has a dividend yield of 0.7%. Phibro Animal Health Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 1.1%. Zoetis pays out 24.4% of its earnings in the form of a dividend. Phibro Animal Health Corporation pays out 24.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Zoetis has increased its dividend for 3 consecutive years.
Valuation & Earnings
This table compares Zoetis and Phibro Animal Health Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Zoetis||$4.96 billion||6.23||$1.71 billion||$1.72||36.63|
|Phibro Animal Health Corporation||$758.62 million||1.92||$116.09 million||$1.62||22.65|
Zoetis has higher revenue and earnings than Phibro Animal Health Corporation. Phibro Animal Health Corporation is trading at a lower price-to-earnings ratio than Zoetis, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Zoetis has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, Phibro Animal Health Corporation has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500.
Zoetis beats Phibro Animal Health Corporation on 14 of the 17 factors compared between the two stocks.
Zoetis Company Profile
Zoetis Inc. is engaged in the discovery, development, manufacture and commercialization of animal health medicines and vaccines, with a focus on both livestock and companion animals. The Company has a business, commercializing products across eight core species: cattle, swine, poultry, sheep and fish (collectively, livestock) and dogs, cats and horses (collectively, companion animals), and within five product categories: anti-infectives, vaccines, parasiticides, medicated feed additives and other pharmaceuticals. The Company’s segments include the United States and International. Within each of these operating segments, it offers a product portfolio for both livestock and companion animal customers. Its livestock products include Ceftiofur injectable line, Draxxin, Spectramast, Bovi-Shield line, Rispoval line, Suvaxyn/Fostera, Embrex devices and Lutalyse. Its companion animal products include Clavamox/Synulox, Convenia, ProHeart, Revolution/Stronghold, Apoquel, Cerenia and Rimadyl.
Phibro Animal Health Corporation Company Profile
Phibro Animal Health Corporation (Phibro) is a global diversified animal health and mineral nutrition company. The Company operates in three segments, which include Animal Health, Mineral Nutrition and Performance Products. The Company offers various products, which include Animal health products, such as antibacterials, anticoccidials, vaccines, nutritional specialty products and mineral nutrition products. The Company also manufactures and markets specific ingredients for use in the personal care, automotive, industrial chemical and chemical catalyst industries. The Company’s Medicated Feed Additives (MFAs) and other business consist of concentrated medicated products, which are administered through animal feeds. The Company’s MFAs and other business consists of the production and sale of antibacterials, including Stafac, Terramycin, Neo-Terramycin and Mecadox and anticoccidials, including Nicarb, Aviax, Aviax Plus, Coxistac and amprolium.
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