Piper Sandler Flags Near-Term Uncertainty for Zoetis (ZTS) Despite Long-Term Appeal

Zoetis Inc. (NYSE:ZTS) is included among the 12 Most Profitable Dividend Stocks to Buy in 2026.

On January 22, Piper Sandler downgraded Zoetis Inc. (NYSE:ZTS) to Neutral from Overweight. It also slashed its price target to $135 from $190. The firm said it still likes Zoetis’ product portfolio over the long run, but sees too much uncertainty in the next couple of years. Until more new products actually reach the market, Piper is hesitant to lean on current forecasts.

The analyst described the company as being in an innovation lull, saying Zoetis “is in an innovation air pocket that could last one to two years.” Piper also questioned whether the current consumer spending backdrop supports the price points tied to the company’s planned 2026 launches, especially when viewed through a value-for-money lens.

That caution stands in contrast to how Zoetis has been positioning itself. During its Innovation Webcast on December 2, the company emphasized the breadth of its pipeline, which spans multiple species, therapeutic areas, and stages of development. Management pointed to 12 candidates with blockbuster potential, including programs targeting chronic kidney disease, oncology, and cardiology. The pipeline also includes next-generation treatments in established franchises such as osteoarthritis pain and dermatology.

Looking further out, Zoetis highlighted work underway in areas like anxiety and metabolic diseases, including diabetes and obesity. The strategy is deliberately balanced, combining geographic expansion, lifecycle extensions, and entirely new products. Management framed this approach as a way to both strengthen existing franchises and push the industry forward.

Zoetis Inc. (NYSE:ZTS) is a global animal health company focused on developing and commercializing medicines, vaccines, diagnostics, biodevices, genetic tests, and precision health tools for animals.

While we acknowledge the potential of ZTS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: Dividend Contenders List: Top 20 Stocks and 15 Best High Yield Stocks To Buy.

Disclosure: None.