Aug. 5 at 4:48 PM
$ZTS Morgan Stanley reiterates Overweight rating and
$220 PT
"Expectations were low, but we are encouraged by the 2Q beat and the raised 2025 operational guidance. Investor focus is also on US Librela sales of
$45M in 2Q (in-line with MSe
$45M, below Cons.
$52M and 1Q25
$47M), where we view expectations were already very low and we expect more on that front on the call (of note, Simparica Trio, grew 20% globally). Overall, we continue to view the unmatched breadth of ZTS' portfolio as significantly underappreciated with continuing innovation expected to further distinguish ZTS from competitors, enhancing its exposure to faster-growing, more profitable categories. Its shares are currently trading at 20.9x FY+1 P/E, a discount to its 5-yr historical average (29.0x) and IDXX (45.8x), further supporting our OverWeight rating"
