Is Zoetis, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Zoetis, Inc. has moved from expensive to fair. The company appears to be fairly valued based on its current metrics. Key ratios include a P/E ratio of 31, an EV to EBITDA of 21.76, and a PEG ratio of 3.69, which suggest that while the company is priced at a premium, it may still offer reasonable growth potential compared to its earnings.
In comparison to peers, Zoetis has a P/E ratio of 27.30, which is more attractive than Eli Lilly & Co. at 40.89 but less favorable than Johnson & Johnson at 26.18. The EV to EBITDA ratio for Zoetis is also higher than that of AbbVie, Inc. at 16.51, indicating a relative overvaluation in terms of enterprise value compared to earnings before interest, taxes, depreciation, and amortization. Notably, Zoetis has underperformed against the S&P 500 over multiple periods, with a YTD return of -11.58% compared to the index's 13.30%, reinforcing the notion that the stock may not be a compelling buy at its current valuation.