Zoetis (ZTS) is one of my favorite healthcare plays, but with a twist, asserts Chuck Carlson, dividend reinvestment specialist and editor of DRIP Investor.

The company is a leading provider of animal health medicines, vaccines, and diagnostic products for both farm animals (around 40% of total revenue in 2021) and companion animals (60% of revenues). The company was spun off from Pfizer (PFE) in 2013 and has posted higher profits every year since becoming an independent company.

The firm is coming off a solid 2021 in which revenues rose 15% and adjusted net income was up 19%. For 2022, the company expects revenue growth in the 9%-11% range and adjusted net income of 10%-13%. Continued growth in spending on companion animals should help drive profits and sales over the long term.

Zoetis stock is down nearly 24% from its 52-week high of $249. The stock still is not what you would consider a bar- gain — the shares trade at 37 times the fiscal 2022 earnings estimate of $5.16 per share.

So, there might be a bit more air underneath the current price. However, don’t expect to buy these shares at a “cheap” valuation. The stock’s decline is enough to draw my interest in initiating positions.

Zoetis offers a direct-purchase plan whereby any investor may buy the first share and every share directly. Minimum initial investment is $500. The firm will waive the minimum if an investor agrees to automatic monthly investment via electronic debit of a bank account of at least $50.

Purchase fees are $5 ($2.50 if purchases made with automatic monthly investment) plus $0.05 per share. Selling fees are $15 plus $0.12 per share. The plan administrator is Computershare. For enrollment information call (877) 373-6374 or visit computershare.com.

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