NSRGY - PAWZ: Expensive Way To Invest In Pet Humanization

• PAWZ tracks the FactSet Pet Care Index, the benchmark that includes players that should benefit from growing spending on pet ownership globally.
• The global long-term trends look rosy, as the industry is forecast to expand from $232 billion in 2020 to $350 billion by 2027. That is a massive investment opportunity.
• The problems PAWZ has are quite typical for a thematic fund: it is top-heavy and highly concentrated. The fund has 31 equity holdings, with over 68% allocated to the top ten.
• In the top ten cohort, there are obvious pure-play pet care companies like FRPT, while also consumer staples and healthcare heavyweights like NSRGY and MRK, which makes the equity blend more balanced.
• On the negative side, the fund has an overstretched P/E and meager standardized yield.

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