WallStSmart

HUTCHMED DRC (HCM)vsZoetis Inc (ZTS)

VS

Smart Verdict

WallStSmart Research — data-driven comparison

Zoetis Inc generates 1626% more annual revenue ($9.47B vs $548.51M). HCM leads profitability with a 83.3% profit margin vs 28.2%. HCM trades at a lower P/E of 5.3x. ZTS earns a higher WallStSmart Score of 64/100 (C+).

HCM

Hold

42

out of 100

Grade: D

Growth: 3.3Profit: 6.0Value: 7.7Quality: 6.5
Piotroski: 3/9Altman Z: 0.95

ZTS

Buy

64

out of 100

Grade: C+

Growth: 5.3Profit: 10.0Value: 7.3Quality: 7.0
Piotroski: 4/9Altman Z: 3.14
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

HCMUndervalued (+16.1%)

Margin of Safety

+16.1%

Fair Value

$18.02

Current Price

$14.15

$3.87 discount

UndervaluedFair: $18.02Overvalued
ZTSSignificantly Overvalued (-29.1%)

Margin of Safety

-29.1%

Fair Value

$99.69

Current Price

$116.71

$17.02 premium

UndervaluedFair: $99.69Overvalued

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

HCM4 strengths · Avg: 10.0/10
P/E RatioValuation
5.3x10/10

Attractively priced relative to earnings

Return on EquityProfitability
45.3%10/10

Every $100 of equity generates 45 in profit

Profit MarginProfitability
83.3%10/10

Keeps 83 of every $100 in revenue as profit

Debt/EquityHealth
0.0810/10

Conservative balance sheet, low leverage

ZTS5 strengths · Avg: 9.6/10
Return on EquityProfitability
66.0%10/10

Every $100 of equity generates 66 in profit

Operating MarginProfitability
34.7%10/10

Strong operational efficiency at 34.7%

Altman Z-ScoreHealth
3.1410/10

Safe zone — low bankruptcy risk

Market CapQuality
$51.09B9/10

Large-cap with strong market position

Profit MarginProfitability
28.2%9/10

Keeps 28 of every $100 in revenue as profit

Areas to Watch

HCM4 concerns · Avg: 2.8/10
Price/BookValuation
9.8x4/10

Trading at 9.8x book value

Piotroski F-ScoreQuality
3/93/10

Weak financial health signals

Revenue GrowthGrowth
-16.5%2/10

Revenue declined 16.5%

EPS GrowthGrowth
-98.1%2/10

Earnings declined 98.1%

ZTS4 concerns · Avg: 3.3/10
PEG RatioValuation
1.874/10

Expensive relative to growth rate

Price/BookValuation
14.9x4/10

Trading at 14.9x book value

Revenue GrowthGrowth
3.0%4/10

3.0% revenue growth

Debt/EquityHealth
2.851/10

Elevated debt levels

Comparative Analysis Report

WallStSmart Research

Bull Case : HCM

The strongest argument for HCM centers on P/E Ratio, Return on Equity, Profit Margin. Profitability is solid with margins at 83.3% and operating margin at -13.2%.

Bull Case : ZTS

The strongest argument for ZTS centers on Return on Equity, Operating Margin, Altman Z-Score. Profitability is solid with margins at 28.2% and operating margin at 34.7%.

Bear Case : HCM

The primary concerns for HCM are Price/Book, Piotroski F-Score, Revenue Growth.

Bear Case : ZTS

The primary concerns for ZTS are PEG Ratio, Price/Book, Revenue Growth. Debt-to-equity of 2.85 is elevated, increasing financial risk.

Key Dynamics to Monitor

HCM profiles as a declining stock while ZTS is a value play — different risk/reward profiles.

ZTS carries more volatility with a beta of 0.95 — expect wider price swings.

ZTS is growing revenue faster at 3.0% — sustainability is the question.

ZTS generates stronger free cash flow (732M), providing more financial flexibility.

Bottom Line

ZTS scores higher overall (64/100 vs 42/100), backed by strong 28.2% margins. HCM offers better value entry with a 16.1% margin of safety. Both earn "Buy" and "Hold" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

HUTCHMED DRC

HEALTHCARE · DRUG MANUFACTURERS - SPECIALTY & GENERIC · USA

HUTCHMED (China) Limited discovers, develops and markets targeted immunotherapies and therapies for cancer and immune diseases globally. The company is headquartered in Central, Hong Kong.

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Zoetis Inc

HEALTHCARE · DRUG MANUFACTURERS - SPECIALTY & GENERIC · USA

Zoetis Inc. is an American drug company, the world's largest producer of medicine and vaccinations for pets and livestock.

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