Using the PEG framework with analyst consensus forward EPS growth of 10.7% plus 1.7% dividend yield, Zoetis Inc. has a fair value of $75.21 based on NTM EPS (FY2026) of $7.01. The current PEG ratio is 1.56.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 9.0% |
| Dividend Yield | +1.7% |
| Adjusted Growth (clamped 8–25%) | 10.7% |
| Fair P/E | 10.7x |
| NTM EPS (FY2026) | $7.01 |
| Fair Value | $75.21 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $6.02 | — | — |
| FY2026E | $7.01 | +16.4% | 14 |
| FY2027E | $7.54 | +7.7% | 14 |
| FY2028E | $8.16 | +8.1% | 13 |
| FY2029E | $8.69 | +6.6% | 12 |
| FY2030E | $9.27 | +6.6% | 6 |
5Y Forward EPS CAGR: 9.0%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $2.0B | $4.27 | — |
| FY2022 | $2.1B | $4.49 | +5.2% |
| FY2023 | $2.3B | $5.07 | +12.9% |
| FY2024 | $2.5B | $5.47 | +7.9% |
| FY2025 | $2.7B | $6.02 | +10.1% |
4Y Historical EPS CAGR: 9.0%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.