Zoetis stock slumped Monday, though the animal-health company beat third-quarter forecasts on the back of double-digit growth from its pet drugs business.
The company is well-known for products like Simparica Trio, Librela and Apoquel. Vets uses these to ward off parasites, treat osteoarthritis and itching in dogs, respectively.
During the third quarter, sales from Zoetis' companion animal business — which treats dogs, cats and horses — generated $1.61 billion in sales, growing 14%. Sales grew 15% on an operational basis. Sales easily beat expectations for $1.53 billion.
But Zoetis stock skidded 3.7% to close at 175.18. Shares undercut their 200-day moving average. Zoetis stock has been consolidating with a buy point at 201.92, according to MarketSurge. That underperformed the broader pharma industry group, which saw a 1.5% decline.
Still, William Blair analyst Brandon Vazquez remained upbeat on the stock.
"We view companion animal as the main driver of sentiment for shares and were encouraged to see 15% global growth in the segment despite concerns about competition and end-market noise (i.e., hurricanes and vet visits)," he said in a report.
Zoetis Stock: Raised Outlook
Across all products, sales advanced 11% to $2.39 billion, beating expectations for $2.29 billion. The company also earned an adjusted $1.58 per share, above forecasts for $1.46, according to FactSet. Earnings jumped 16% year over year.
In addition to strong sales from companion animal products, sales of treatments for livestock rose 6% to $758 million. That also topped projections for $746 million. Operationally, sales jumped 11%.
Zoetis raised its outlook for the year. The company now expects adjusted earnings of $5.86 to $5.92 per share and $9.2 billion to $9.3 billion in sales. Analysts projected adjusted income of $5.83 per share and nearly $9.2 billion in sales.
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