#7 - Zoetis (NYSE:ZTS)
Healthcare stocks, and particularly pharmaceutical stocks, are often considered strong defensive stocks to own. Consumers will cut back on many things, but prescriptions are a must-have, not a nice-to-have.
That dynamic extends to the health of our pets. Spending on pet health continues to grow. Zoetis Inc. (NYSE: ZTS) develops and brings to market animal health medicines, vaccines, and diagnostic products.
Through the first three quarters of 2023, Zoetis is reporting consistent revenue and earnings growth despite difficult comparisons to 2021 and 2022, when many families added a furry friend or two to their homes. The company is projecting earnings growth of over 10% in 2024.
While the company's dividend has an uninspiring 0.77% yield, it has been growing the dividend at an annual rate of over 23% in the last three years while increasing the dividend for the last 12 consecutive years.
Investors are paying a premium for ZTS stock, which trades at a forward P/E of 36x. However, it has a more attractive P/S ratio of just over 11x.
About Zoetis
Zoetis Inc engages in the discovery, development, manufacture, and commercialization of animal health medicines, vaccines, and diagnostic products and services in the United States and internationally. The company commercializes products primarily across species, including livestock, such as cattle, swine, poultry, fish, and sheep and others; and companion animals comprising dogs, cats, and horses.
Read More - Current Price
- $165.52
- Consensus Rating
- Buy
- Ratings Breakdown
- 10 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $215.22 (30.0% Upside)
Investing can seem intimidating, especially when you see the share price of many "quality" companies dropping by 5% or more. But the mistake many long-term investors make is thinking like a trader. Over the long haul, buying shares of quality companies such as the ones listed here will deliver solid returns over time.
That's particularly true of defensive stocks. Companies that make products that every consumer or business needs will always have a solid upside. And with many of these, you get a reliable dividend, which gives you a steady source of income regardless of the direction of the stock.
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