Head-To-Head Comparison: Phibro Animal Health Corporation (PAHC) vs. Zoetis (NYSE:ZTS)

Phibro Animal Health Corporation (NASDAQ: PAHC) and Zoetis (NYSE:ZTS) are both medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitabiliy, earnings and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Phibro Animal Health Corporation and Zoetis, 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 1 4 13 0 2.67

Phibro Animal Health Corporation currently has a consensus price target of $28.80, indicating a potential downside of 24.31%. Zoetis has a consensus price target of $62.67, indicating a potential downside of 0.64%. Given Zoetis’ stronger consensus rating and higher probable upside, analysts plainly believe Zoetis is more favorable than Phibro Animal Health Corporation.

Dividends

Phibro Animal Health Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 1.1%. Zoetis pays an annual dividend of $0.42 per share and has a dividend yield of 0.7%. Phibro Animal Health Corporation pays out 24.7% of its earnings in the form of a dividend. Zoetis pays out 24.4% 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. Phibro Animal Health Corporation has raised its dividend for 3 consecutive years. Phibro Animal Health Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Phibro Animal Health Corporation and Zoetis’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Phibro Animal Health Corporation $758.62 million 0.94 $116.09 million $1.62 23.49
Zoetis $4.96 billion 6.24 $1.71 billion $1.72 36.67

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.

Volatility & Risk

Phibro Animal Health Corporation has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500. Comparatively, Zoetis has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500.

Profitability

This table compares Phibro Animal Health Corporation and Zoetis’ 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%
Zoetis 17.25% 65.35% 13.06%

Insider & Institutional Ownership

47.6% of Phibro Animal Health Corporation shares are held by institutional investors. Comparatively, 95.1% of Zoetis shares are held by institutional investors. 48.1% of Phibro Animal Health Corporation shares are held by insiders. Comparatively, 0.3% of Zoetis shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Zoetis beats Phibro Animal Health Corporation on 13 of the 17 factors compared between the two stocks.

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.

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.

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