BofA Upgrades Zoetis Stock On Business Potential, Valuation

Zoetis Inc ZTS seems well-positioned in 2021 with the stock valuation offering an attractive entry point, according to BofA Securities.

The Zoetis Analyst: Michael Ryskin upgraded the rating for Zoetis from Neutral to Buy, while maintaining a price target of $180.

The Zoetis Thesis: The company reported robust fourth-quarter results and issued upbeat guidance for 2021, Ryskin said in the upgrade note.

These factors, along with conversations with management and industry experts, suggest bright prospects for the animal health industry in 2021 and beyond, he added.

“Zoetis is poised for another strong year in Companion Animal, and livestock should rebound slightly with upside in 2H,” the analyst wrote.

While Companion Animal spend may not be as strong in 2021 as it was last year, it should remain elevated, Ryskin said. “As a result, we are incrementally more bullish on the business given the 10% core sales guide in 2021, and find the valuation enticing after the recent sell-off,” he added.

ZTS Price Action: Shares of Zoetis had risen by 1.67% to $148.13 at the time of publication Monday.

(Photo: Zoetis)