UPDATE: Bank of America Initiates Zoetis at Neutral; Growth Outlook Reflected in Valuation

Bank of America initiated coverage on Zoetis

with a Neutral rating and a $35.00 price objective. Bank of America analyst Robert M. Willoughby commented, "Clear competitive advantages should enable Zoetis to grow EPS at a long term annual rate of 15%, which, along with low capital expenditures, better working capital management, and deleveraging, affords it ample leverage to improve ROIC. … With its shares up 30% (vs. +4% S&P500) since its January 31 IPO, Zoetis clearly has benefited from a veterinary focus that shelters it from reimbursement and regulatory challenges, research and development inefficiencies, and other issues overhanging the human health sector." Zoetis closed at $33.82 on Tuesday.