Paul Lountzis presented his in-depth investment thesis on Zoetis (NYSE: ZTS) at Wide-Moat Investing Summit 2014.
Zoetis: Recent spin-off from Pfizer and the global #1 animal health provider serving the livestock (64% of revenue) and companion animal (34% of revenue) markets. Sources of moat: 1) 3,500+ member field force; 2) R&D and manufacturing capabilities; and 3) global regulatory expertise. Experiencing some difficulties due to the separation from Pfizer (creation and implementation of various internal departments; substantial costs to becoming an independent company) that lead current financials to understate true earning power. Lountzis estimates revenue growth of 5-6% and EPS growth of 8-12% over the next few years, implying EPS of $1.94 in 2016, which is more reflective of underlying earning power. Given market share leadership in a growing global category (benefits from population growth, increasing protein consumption and rising global middle class), Lountzis finds the ~6% earnings yield attractive.
About the instructor:
Paul Lountzis founded Lountzis Asset Management, LLC in October 2000. He has more than 25 years experience in the investment industry, beginning his career with Royce & Associates, a New York City-based investment advisory firm managing the Royce Mutual Funds. Paul spent nine years, with the last five as a partner at Ruane, Cunniff & Goldfarb, Inc. an investment advisory firm managing more than $9 billion including the Sequoia Mutual Fund. While at Ruane, Cunniff & Goldfarb, Inc., Paul also evaluated several companies for Warren Buffett.
Members, log in below to access the full session.
Not a member?
Thank you for your interest. Please note that MOI Global is closed to new members at this time. If you would like to join the waiting list, complete the following form: