Animal-health player Zoetis topped fourth-quarter expectations on Tuesday, leading ZTS stock to inch higher.
For the December period, Zoetis earned $1 per share, minus some items. Zoetis earnings jumped 10% and beat forecasts for 96 cents per share, according to FactSet. Sales grew roughly 9% to $1.97 billion, topping ZTS stock analyst estimates for $1.93 billion.
Overall, the best growth came from Zoetis' pet segment. Revenue from vaccines and treatments for companion animals surged 21% to $1.18 billion. Spending on dogs and cats accounted for the majority of those sales with horses trailing behind. Zoetis noted strong growth for its dog parasiticide, Simparica Trio, as well as dermatology products.
Livestock Products Pressured
But sales of drugs for livestock animals fell 6% to $760 million and missed the average forecast of ZTS stock analysts for $789.3 million. Spending on fish and sheep climbed, while sales of products for cattle, swine and poultry fell.
Zoetis' Draxxin, a treatment for respiratory illness in cattle, is facing generic competition. Zoamix, a treatment for an intestinal tract infection in chicken, is facing generics in the U.S. Further, Americans are consuming lower levels of beef and dairy, and eating lower-cost alternatives to chicken. Zoetis also noted pricing pressure on swine products in the U.S. and abroad.
For the current fiscal year, Zoetis predicts $8.33 billion to $8.48 billion in sales. The company expects adjusted earnings of $5.09-$5.19 per share. Operationally, sales would rise 9%-11% with earnings up 10%-13%. The midpoint of sales guidance was just above ZTS stock analyst calls for $8.39 billion. But Zoetis earnings guidance missed expectations for $5.21 per share.
On today's stock market, ZTS stock climbed 0.7% to 197.76. Shares drew back from a 2.6% gain in early action.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
