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ZOETIS INC. (ZTS) — WACC Analysis

WACC Breakdown

ZOETIS INC. (ZTS) has a weighted average cost of capital (WACC) of 7.0%. The cost of equity is 8.4%, derived from a beta of 0.79 and a risk-free rate of 4.7%. The after-tax cost of debt is 2.1%. The capital structure is 77.9% equity and 22.1% debt.

Interpretation

A WACC of 7.0% suggests that the market views ZOETIS INC. as relatively low-risk, with a lower cost of financing.

Investors can compare ZTS's WACC of 7.0% against industry peers to gauge its relative financing costs. A beta of 0.79 reflects the stock's volatility relative to the broader market.

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VALUATION

ZTS WACC: 6.98% for ZOETIS INC.

Current inputs imply a 8.37% cost of equity and a 2.63% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

ZOETIS INC. Common Stock (ZTS) WACC Results
Weighted Average Cost of Capital
6.98%
Cost of Equity
8.37%
Risk-Free Rate4.73%
Beta0.79
Market Risk Premium4.23%
Cost of Debt
2.08%
Pre-Tax Cost of Debt2.63%
Tax Rate21.00%
Tax Shield0.55%
Capital Structure
Equity: 77.88%($31.86B)
Debt: 22.12%($9048.00M)
Equity Component
6.52%
77.88% × 8.37%
Debt Component
0.46%
22.12% × 2.08%

ZOETIS INC. (ZTS) WACC in context

ZOETIS INC. (ZTS) currently screens with an estimated WACC of 6.98%. That blends a 8.37% cost of equity, a 2.63% pre-tax cost of debt, and a 77.88% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What ZTS WACC implies

A 6.98% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates ZTS

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.79 and equity accounts for 77.88% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.