Answer
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
The best type of animals for udhiyah are camels, then cattle (i.e., cow, bull)—if sacrificed on behalf of one person—then sheep, then goats, then one-seventh of a camel, then one-seventh of a cattle.
Answering your question, the Fatwa Center at Islam Q and A, states:
The best type of animals for udhiyah are camels, then cattle (i.e., cow, bull)—if sacrificed on behalf of one person—then sheep, then goats, then one-seventh of a camel, then one-seventh of a cattle.
The best type of animals are those that are fat and have more meat, and are physically complete and look good (i.e., healthy and undeformed).
It is narrated from Anas ibn Malik (may Allah be pleased with him) that the Prophet (peace and blessings be upon him) used to sacrifice two horned rams that were white speckled with black.
It was narrated that Abu Said Al-Khudri (may Allah be pleased with him) said, “The Prophet (peace and blessings be upon him) sacrificed a whole (i.e., not castrated), horned male sheep, with a black face and black (circles) round the eyes, and black legs.”
It was narrated that Abu Rafi, the freed slave of the Prophet (peace and blessings be upon him) said, “When the Prophet (peace and blessings be upon him) offered a sacrifice, he would buy two fat rams.” According to one version, “castrated rams.” (Ahmad)
Fat means an animal that has a lot of fat and meat. Castrated means one that has had its testicles removed. This is usually better than an uncastrated animal with regard to the taste of the meat, but the uncastrated animal is more complete in a physical sense.These are the best kinds of sacrifice with regard to type and characteristics.
With regard to those that are makruh (disliked), they are as follows:
1- Those who have had one half or more of their ears or horns cut off.
2- Those whose ears have been slit crosswise from the front.
3- Those whose ears have been slit crosswise from the back.
4- Those whose ears have been slit lengthwise.
5- Those whose ears have had a hole made in them.
6- Those whose ears have been cut until the ear channel is visible; or those that are so emaciated that there is no marrow in their bones.
7- Those whose horns have been removed entirely.
8- Those that are completely blind even though the eyes are still present.
9- Those that do not follow the flock and join it unless they are herded and driven to do so.
These are the animals that it is makruh to sacrifice, as narrated in the hadiths that forbid sacrificing those that have these faults or enjoin avoiding such animals. This is understood as meaning that it is makruh, when these reports are taken in conjunction with the hadith of Al-Bara’ ibn `Aazib (may Allah be pleased with him) who said, “The Prophet (peace and blessings be upon him) was asked, ‘What should be avoided in the sacrificial animals?’ He gestured with his hand and said, ‘Four: a lame animal that is obviously lame; a one-eyed animal whose defect is obvious; a sick animal whose sickness is obvious; and an emaciated animal that no one would choose’” (Al-Muwatta)
Animals with similar faults are also added to this list, so it is makruh to sacrifice the following kinds of animals:
1- Camels, cattle, and goats that have had half or more of their tails cut off.
2- Those that have had less than half of their fat tails cut off. If half or more has been cut off, then according to the majority of scholars it is unsuitable for sacrifice. If it was born that way, however, there is nothing wrong with it.
3- An animal whose penis has been cut off.
4- An animal that has lost some of its teeth, whether incisors or molars. But if it was born like that it is not makruh to sacrifice it.
5- An animal whose teats have been cut off. But if it was born like that it is not makruh to sacrifice it. If its milk has stopped flowing but its teats are intact, there is nothing wrong with it.
If these five are added to the nine mentioned above, the number of makruh animals reaches fourteen.
Almighty Allah knows best.