Animalcare: in the recovery room or more surgery needed? (Updated)
This animal health business appeared to have a bright future, unfortunately, the merger with an ambitious European animal healthcare business resulted in a host of problems and a material decline in the share price. The focus on fewer core products appears to be making progress.
The sale of vaccines, medicines and medical devices for companion animals alone is a massive business, exceeding $8bn annually in 2018 with an additional $14bn in sales of vaccines and medicines for livestock. The sector is dominated by US listed Zoetis Inc, which was spun out of pharmaceutical giant Pfizer in 2012. Zoetis, which has a current market capitalisation of $76bn, has seen its share price soar to new highs over recent months, despite the pandemic, and now trades at a heady 45 times current year 2020 earnings estimates or nearly 12x forecast sales - shares in Animalcare trade at a lowly 1.6x historic…