Is Zoetis a Good Investment For the End of 2022?
One global megatrend we love to track is the rise of pet care. So we took a look at a company poised to take advantage of the growing market.
Sept. 13, 2022

This article can be found in full in the MyWallSt App, alongside an audio companion. Sign up today for a free account and get access to dozens of expertly written articles and analyst opinion pieces every month.

As investors, we always like to identify trends happening in the world around us. Most are obvious: cashless payments, the rise of cloud computing, electric cars. However, one underlying global megatrend we love to track here at MyWallSt is the rise of pet care.

This was already a craze long before COVID-19 became an everyday reality, but lockdown certainly sped things up. According to the American Society for the Prevention of Cruelty to Animals (ASPCA), more than 23 million American households -- nearly 1 in 5 nationwide -- adopted a pet during the pandemic.

And as the saying goes, these pets are for life, not just for ChristmasOVID. In fact, 91% of U.S. "pet parents" consider their pets to be family members and 81% consider them as equal members of the family.

This all means big business for the companies involved in the industry. Fortune Business Insights has the global pet-care market set to grow at a 6% CAGR to $326 billion by 2028. A company I've highlighted to take advantage of this growing market is Zoetis.

Zoetis is the world's largest animal-care company. It manufactures medicine and vaccinations for pets and livestock. Initially a subsidiary of Pfizer called Pfizer Animal Health, it was spun off in 2013 to become its own independent company. It serves two major markets -- companion animals (pets) and production animals (livestock). Companion animals make up about 64% of total revenue, while in the U.S. they account for 76%.

The company boasts a dominant market position in companion animals, cattle, fish, and pigs and 13 of its products generate more than one-third of total animal health sales. Constantly innovating, the company has introduced close to 1,000 new products and updates to existing products over the past five years. Products range from parasitics, dermatological products, arthritis treatments for cats and dogs, and respiratory antibiotics in cattle, to name a few.

There is a lot to like about Zoetis' business model. The purchasing power in the animal space is a lot more fragmented than in human care, with the absence of government payers or larger managed care firms and health insurance companies. Buyers instead are farmers, vets, and pet owners, meaning Zoetis enjoys more pricing power. Its scale and existing relationships become much more important in a fragmented buyer market too, giving it a competitive advantage over new entrants.

And that's only the beginning...

Top Ten Stocks To Buy Now
Commit to your future wealth today and join 1000s of subscribers receiving:
  • New stock picked every week out of 60,000 worldwide
  • Ten Foundational stocks to hold until 2034
  • A library of 60 stocks with analysis
  • 10 year Track record of performance
By submitting your email address, you consent to us keeping you informed about updates to our website and about other products and services that we think might interest you. You can unsubscribe at any time. Please read our Privacy Policy and Terms of Use.

The Home of Successful Investing.

© 2024 MyWallSt Ltd. All rights reserved.







This website is operated by MyWallSt Ltd (“MyWallSt”). MyWallSt is a publisher and a technology platform, not a registered broker-dealer or registered investment adviser, and does not provide investment advice. All information provided by MyWallSt Limited is of a general nature for information and education purposes, and you should not construe any such information as investment advice. MyWallSt Limited does not take your specific needs, investment objectives or financial situation into consideration, and any investments mentioned may not be suitable for you. You should always carry out your own independent verification of facts and data before making any investment decisions, as we cannot guarantee the accuracy or completeness of any information we publish and any opinions that we publish may be wrong and may change at any time without notice. If you are unsure of any investment decision you should seek a professional financial advisor. MyWallSt Limited is not a registered investment adviser and we do not provide regulated investment advice or recommendations. MyWallSt Limited is not regulated by the Central Bank of Ireland. MyWallSt Limited may provide hyperlinks to web sites operated by third parties. Your use of third party web sites and content, including without limitation, your use of any information, data, advertising, products, or other materials on or available through such web sites, is at your own risk and is subject to the third parties' terms of use.