Section 1: Company Overview and Fundamentals

• Company Overview:

The company Zoetis Inc. focuses on the research, development, production, and marketing of drugs, vaccines, diagnostic tools, biotechnological devices, genetic testing, and precision animal health technologies. The company operates a business that involves the commercialization of products for eight core species, including cattle, swine, poultry, fish, sheep, dogs, cats, and horses and cattle, swine, and pigs. The company also sells products in the areas of dermatology, anti-infectives, parasiticides, vaccines, and other pharmaceuticals, as well as medicated feed additives and animal health diagnostics.

1.2 The Key Positives, Negatives, and Investment summary

1.3 Key Metrics:

The graphs below demonstrate the rising trend in the company's sales, gross profits, and gross profit margin, due to increased demand for the company’s products as well as increased efficiency in lowering the cost of revenues by the company. Furthermore, the company has grown its revenues and gross profit at an impressive 5-year CAGR rate of 9.73% and 11.04% respectively.

1.4 Top 10 shareholders:

• The top 10 shareholders together form ~34.93% of the total shareholding, signifying consolidating shareholding. The Vanguard Group Inc and BlackRock Institutional Trust Company are the biggest shareholders, holding the maximum stake in the company at ~7.74% and ~4.98%, respectively.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates:

The below picture gives an overview of the recent updates:

 2.2 Insights of Q2FY22:

Section 3: Key Risks and Outlook

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple Based Relative Valuation

Markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 3: The report publishing date is as per the Pacific Time Zone.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavorable movement in the stock prices.

Disclaimer

The advice given by Kalkine Canada Advisory Services Inc. and provided on this website is general information only and it does not take into account your investment objectives, financial situation and the particular needs of any particular person. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. The website www.kalkine.ca is published by Kalkine Canada Advisory Services Inc. The link to our Terms & Conditions has been provided please go through them. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations later.