ZTS — Valuation Models

Interactive models with editable assumptions. All calculations run client-side.

Valuation Summary

Model	Intrinsic Value	vs Price ($128.96)
DCF	$62.86	-51.3%
Graham Number	$32.59	-74.7%
Reverse DCF	—	implied g: 16.5%
DDM	$43.67	-66.1%
EV/EBITDA	$128.96	-0.0%

Values reflect default assumptions. Adjust inputs in each model below to update.

1 — Discounted Cash Flow (DCF)

Assumptions

Base FCF($B)Yahoo: $1.79B

Near-term growth (yrs 1–5)(%)Rev: 3.0% / EPS: 6.1%

Long-term growth (yrs 6–10)(%)

Terminal growth rate(%)

WACC(%)Computed: 8.58%

Computed WACC: 8.58%

Cost of equity (Re)9.59%(Rf 4.30% + β 0.96 × ERP 5.50%)

Cost of debt (Rd)3.11%(interest expense ÷ avg debt (SEC))

Tax rate (T)21.00%(US statutory fallback)

Equity weight (E/V)85.92%

Debt weight (D/V)14.08%

Results

Intrinsic Value / share$68.34

Current Price$128.96

Upside / Downside-47.0%

Net Debt (used)$7.00B

Sensitivity: WACC (rows) × Near-term g (cols)

WACC \ Near-term	-1.9%	2.1%	6.1%	10.1%	14.1%
7.0%	$63.90	$80.06	$98.83	$120.53	$145.50
8.0%	$49.44	$62.42	$77.49	$94.89	$114.88
9.0%	$39.42	$50.22	$62.73	$77.16	$93.72
10.0%	$32.07	$41.27	$51.92	$64.18	$78.24
11.0%	$26.45	$34.44	$43.66	$54.27	$66.43

2 — Graham Number

Assumptions

MultiplierGraham used 22.5 (15× P/E × 1.5× P/B)

EPS (trailing)($)Yahoo: $6.02

Book Value / share($)Yahoo: $7.84

Results

Graham Number$32.59

Current Price$128.96

Margin of Safety-74.7%

Formula: √(22.5 × max(0,EPS) × max(0,BVPS))

3 — Reverse DCF (Implied Growth)

Assumptions

WACC(%)Computed: 8.58%

Terminal growth rate(%)

Computed WACC: 8.58%

Cost of equity (Re)9.59%(Rf 4.30% + β 0.96 × ERP 5.50%)

Cost of debt (Rd)3.11%(interest expense ÷ avg debt (SEC))

Tax rate (T)21.00%(US statutory fallback)

Equity weight (E/V)85.92%

Debt weight (D/V)14.08%

Results

Current Price$128.96

Implied Near-term FCF Growth15.3%

Historical Revenue Growth3.0%

Historical Earnings Growth6.1%

Base FCF (TTM)$1.79B

Implied growth is the FCF growth rate (yrs 1–5) that makes the DCF intrinsic value equal the current price. Long-term growth is set to half the implied near-term rate.

4 — Dividend Discount Model (DDM)

Assumptions

Annual dividend D0($/share)Yahoo: $2.12

Dividend growth rate (g)(%)

Required return (r)(%)

Results

DDM Intrinsic Value / share$43.67

Current Price$128.96

Upside / Downside-66.1%

Formula: D0 × (1+g) / (r − g)

5 — EV/EBITDA Multiple

Assumptions

EBITDA($B)Yahoo: $4.07B

Target EV/EBITDA multipleCurrent: 15.1×

Net Debt($B)Default: $7.00B

Results

Implied Equity Value / share$128.96

Current Price$128.96

Upside / Downside-0.0%

Implied EV$61.44B

Sensitivity: EV/EBITDA multiple (rows) × Net Debt (cols)

Mult \ Net Debt	$3.00B	$5.00B	$7.00B	$9.00B	$11.00B
11.1x	$99.90	$95.17	$90.43	$85.69	$80.95
13.1x	$119.17	$114.43	$109.69	$104.95	$100.22
15.1x	$138.43	$133.69	$128.96	$124.22	$119.48
17.1x	$157.70	$152.96	$148.22	$143.48	$138.75
19.1x	$176.96	$172.22	$167.49	$162.75	$158.01

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