Beaten Down Spin-Off Covetrus Has A Healthy Future In A Growing Market

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About: Covetrus, Inc. (CVET)
by: Cardon Capital
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Cardon Capital
Value, special situations
Summary

CVET is the combination of Henry Schein's Animal Health business and the Vets First Choice platform.

The stock has seen nonstop selling pressure since the spin and is down >75% from highs.

Both businesses maintain market-leading positions.

CVET is trading for less than what shareholders paid for the Vets First Choice platform alone.

With a dominant distribution business combined with a high-growth B2B platform, equity holders should see double-digit growth rates in earnings and a meaningful rerating in the multiple of the stock.

Overview

Henry Schein's Animal Health business was spun-off in February of 2019 and subsequently merged with Vets First Choice via a Reverse Morris Trust, creating Covetrus (CVET). The company went on a roadshow