Nearly all the attention being placed on solving the global food shortages due to the Russia/Ukraine war has focused on the lack of grain for human consumption, observes Jim Powell, editor of Global Changes & Opportunities Report.
The media is ignoring the impact the grain shortage will have on livestock and other farm animals that billions of people depend upon for a substantial part of their diets.
Cattle, pigs, sheep, farmed fish, and fowl are all expected to decline in numbers and suffer serious health problems caused by a drop in the amount and quality of their food. The situation should lead to several years of rising profits for the global animal healthcare industry.
I believe the most promising animal healthcare company for long-term investors is Zoetis (ZTS). The company was founded in 1952 as a division of the pharmaceutical giant, Pfizer (PFE).
Pfizer Animal Health (as it was called at the time) developed several successful drugs for treating livestock diseases. The division soon expanded as Pfizer acquired several rival animal pharmaceutical companies that had products for both farm animals and pets.
In 2012, Pfizer decided to spin off its animal health division as a standalone company it named Zoetis. A year later, the new company went public. Since then Zoetis greatly expanded its product line and established a global network for its operations.
Today, Zoetis markets a full range of diagnostic products, vaccines for several animal health diseases, medicines, and genetic tests for horses, pigs, beef cattle, dairy cattle, sheep, ducks, chickens, geese, and several species of fish used in aquaculture.
In total, the company produces over 300 animal health and nutrition products that it markets worldwide. I think demand for them will soon increase significantly.
Until the recent bear market brought most stock prices sharply down, Zoetis was doing very well. When the downturn ends, I think the stock will resume its upwards course. Until then, investors have an excellent opportunity to buy this promising company at a significant discount.
