Is Zoetis, Inc. overvalued or undervalued?

As of 27 June 2025, the valuation grade for Zoetis, Inc. has moved from attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued based on its financial metrics. Key ratios include a P/E ratio of 31, a Price to Book Value of 17.32, and an EV to EBITDA of 21.76, which suggest that while the company maintains strong profitability, it is trading at a premium compared to some peers.
In comparison to its peers, Zoetis, Inc. has a P/E ratio of 29.62, which is lower than Eli Lilly & Co. at 48.73, but higher than Johnson & Johnson at 22.46. This places Zoetis in a competitive position, although it is not the most attractively priced option in the sector. Additionally, the company has underperformed against the S&P 500 over various time frames, with a 1-year return of -11.50% compared to the index's 12.59%. Overall, while Zoetis, Inc. demonstrates strong operational metrics, its current valuation suggests it is fairly priced in the market context.