ZOS. Please take a look at this video. Since the recent update to pet speed, pets are jumping around in and out of combat.
It appears to be more common when you are in an instanced zone. Dungoeons, Delves, Imperial City, ect. It happens after combat, and sometimes while in combat. The last combat situation shows the issue most prominently.
This is not a latency issue, its new with the update. My latency should be shown on the bottom of the screen.