Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Zoetis Inc. (NYSE:ZTS)

Financial Reporting Quality: Aggregate Accruals

Advanced level

Balance-Sheet-Based Accruals Ratio

Zoetis Inc., balance sheet computation of aggregate accruals

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Operating Assets
Total assets 13,609  11,545  10,777  8,586  7,649 
Less: Cash and cash equivalents 3,604  1,934  1,602  1,564  727 
Less: Short-term investments —  —  99  —  — 
Operating assets 10,005  9,611  9,076  7,022  6,922 
Operating Liabilities
Total liabilities 9,836  8,837  8,592  6,800  6,150 
Less: Short-term borrowings —  —  — 
Less: Current portion of long-term debt 600  500  —  —  — 
Less: Long-term debt, net of discount and issuance costs, excluding current portion 6,595  5,947  6,443  4,953  4,468 
Operating liabilities 2,637  2,390  2,140  1,847  1,682 
 
Net operating assets1 7,368  7,221  6,936  5,175  5,240 
Balance-sheet-based aggregate accruals2 147  285  1,761  (65) — 
Financial Ratio
Balance-sheet-based accruals ratio3 2.02% 4.03% 29.08% -1.25%
Benchmarks
Balance-Sheet-Based Accruals Ratio, Competitors4
Abbott Laboratories -1.55% -1.97% -6.71% 69.42%
AbbVie Inc. 131.82% -24.37% -31.42% -7.02%
Amgen Inc. 3.47% 56.66% -9.88% -33.04%
Bristol-Myers Squibb Co. -13.24% 147.33% -3.17% -24.97%
Eli Lilly & Co. 18.42% -0.10% -10.27% -5.99%
Gilead Sciences Inc. 59.36% 19.80% -41.29% -16.94%
Illumina Inc. 2.78% -2.16% 10.15% 6.34%
Johnson & Johnson 7.76% -3.85% -8.03% 31.51%
Merck & Co. Inc. 15.90% -2.90% -15.70% -0.65%
Pfizer Inc. -14.91% 19.85% -9.34% 12.36%
Regeneron Pharmaceuticals Inc. 16.50% 25.36% 20.14% 33.15%
Vertex Pharmaceuticals Inc. -8.97% 42.50% 110.08% -29.69%
Balance-Sheet-Based Accruals Ratio, Sector
Pharmaceuticals & Biotechnology 17.01% 24.94% -11.49% 10.25%
Balance-Sheet-Based Accruals Ratio, Industry
Health Care 13.83% 16.24% -0.89% 9.08%

Based on: 10-K (filing date: 2021-02-16), 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-16).

1 2020 Calculation
Net operating assets = Operating assets – Operating liabilities
= 10,0052,637 = 7,368

2 2020 Calculation
Balance-sheet-based aggregate accruals = Net operating assets2020 – Net operating assets2019
= 7,3687,221 = 147

3 2020 Calculation
Balance-sheet-based accruals ratio = 100 × Balance-sheet-based aggregate accruals ÷ Avg. net operating assets
= 100 × 147 ÷ [(7,368 + 7,221) ÷ 2] = 2.02%

4 Click competitor name to see calculations.

Financial ratio Description The company
Balance-sheet-based accruals ratio Ratio is found by dividing balance-sheet-based aggregate accruals by average net operating assets. Using the balance-sheet-based accruals ratio, Zoetis Inc. improved earnings quality from 2019 to 2020.

Cash-Flow-Statement-Based Accruals Ratio

Zoetis Inc., cash flow statement computation of aggregate accruals

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net income attributable to Zoetis 1,638  1,500  1,428  864  821 
Less: Net cash provided by operating activities 2,126  1,795  1,790  1,346  713 
Less: Net cash used in investing activities (572) (504) (2,259) (270) (214)
Cash-flow-statement-based aggregate accruals 84  209  1,897  (212) 322 
Financial Ratio
Cash-flow-statement-based accruals ratio1 1.15% 2.95% 31.33% -4.07%
Benchmarks
Cash-Flow-Statement-Based Accruals Ratio, Competitors2
Abbott Laboratories -2.65% -1.39% -5.39% 12.34%
AbbVie Inc. 44.98% -28.46% -23.85% -12.92%
Amgen Inc. 6.95% -29.37% -95.70% -22.85%
Bristol-Myers Squibb Co. -15.67% 10.75% -1.14% -28.29%
Eli Lilly & Co. 11.38% 74.20% -25.54% -11.43%
Gilead Sciences Inc. 20.18% 19.49% -73.15% 28.23%
Illumina Inc. 5.48% -33.57% 65.79% 3.10%
Johnson & Johnson 17.00% -3.04% -5.08% -7.40%
Merck & Co. Inc. 13.75% -2.28% -19.26% -13.29%
Pfizer Inc. 3.27% 7.93% -10.12% 10.69%
Regeneron Pharmaceuticals Inc. 10.32% 22.48% 28.32% 19.22%
Vertex Pharmaceuticals Inc. -23.47% 35.80% 86.04% -22.78%
Cash-Flow-Statement-Based Accruals Ratio, Sector
Pharmaceuticals & Biotechnology 8.87% 3.38% -17.13% -1.04%
Cash-Flow-Statement-Based Accruals Ratio, Industry
Health Care 8.39% 4.20% -6.12% 0.90%

Based on: 10-K (filing date: 2021-02-16), 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-16).

1 2020 Calculation
Cash-flow-statement-based accruals ratio = 100 × Cash-flow-statement-based aggregate accruals ÷ Avg. net operating assets
= 100 × 84 ÷ [(7,368 + 7,221) ÷ 2] = 1.15%

2 Click competitor name to see calculations.

Financial ratio Description The company
Cash-flow-statement-based accruals ratio Ratio is found by dividing cash-flow-statement-based aggregate accruals by average net operating assets. Using the cash-flow-statement-based accruals ratio, Zoetis Inc. improved earnings quality from 2019 to 2020.