Is Zoetis, Inc. overvalued or undervalued?

As of 28 August 2025, the valuation grade for Zoetis, Inc. has moved from attractive to fair, indicating a shift in its perceived value. The company appears to be overvalued based on its current metrics, with a P/E ratio of 31, a Price to Book Value of 17.32, and an EV to EBITDA ratio of 21.76. In comparison to peers, Zoetis has a higher P/E ratio than Eli Lilly & Co. at 40.89 and Johnson & Johnson at 26.18, suggesting it is priced at a premium relative to these companies.
Additionally, the stock has underperformed against the S&P 500 across multiple time frames, with a year-to-date return of -9.72% compared to the S&P 500's 12.22%. This trend continues over one year, where Zoetis recorded a return of -25.13% against the S&P 500's 17.14%. Overall, these factors reinforce the conclusion that Zoetis, Inc. is overvalued in the current market environment.