Zoetis: The 60% Decline Was Justified, But Shares Are Finally Buyable

Zoetis has seen its valuation compress dramatically, now trading at just 12x trailing earnings after a 52% 12-month share price decline. Despite decelerating growth—Q1 2026 saw just 3% revenue growth—international and livestock segments are offsetting U.S. pet care weakness. Dividend growth remains robust, with a 12-year streak and a current yield of 2.8% backed by a solid payout ratio. At current levels, ZTS offers a solid risk/reward, with fair value estimates suggesting the potential for 50% upside.

Pharmaceutical giant Pfizer spun off its animal health division Zoetis back in 2013. This originally turned out to deliver excellent results for the firm's shareholders. While Pfizer stock hasn't been a standout in recent