1 Stock You'll Wish You Bought Sooner

NYSE: PFE | Pfizer Inc. News, Ratings, and Charts

PFE – Amid the highly uncertain market conditions, investors must look for stocks with ample room for growth and better stability. Biopharmaceutical major Pfizer’s (PFE) products remain in demand irrespective of economic cycles. Given its robust financials, discounted valuation, and high profitability, it could be wise to invest in this defensive stock. Read on….

The consumer price index (CPI) rose 8.3% year-over-year and 0.1% over the prior month in August. The higher-than-expected inflation numbers will likely push the Fed to continue with its aggressive interest rate hikes.

Investors fear that the aggressive interest rate hikes will push the economy into a recession. The pharmaceutical industry has been known to do well amid the recession due to the highly inelastic demand for pharma products. People cannot cut back on medical expenditures, irrespective of the economic cycles.

Pfizer Inc. (PFE - Get Rating) is a research-based, global biopharmaceutical company engaged in the discovery, development, manufacture, marketing, sale, and distribution of biopharmaceutical products worldwide.

PFE surpassed EPS and revenue estimates in the last reported quarter. The company’s revenue beat the consensus estimate by 5.9%, while its EPS was 14.8% higher than Street estimate.

In July, PFE revised its guidance for fiscal 2022. The company now expects its adjusted EPS to come in the range of $6.30-$6.45, up from the $6.25-$6.45 guided before. Its adjusted EPS is expected to grow between 55% and 59%, compared to the earlier expectation of 54- 59%.

PFE pays a $1.60 per share dividend annually, translating to a 3.47% yield. The company’s dividend has grown at a 5.7% CAGR over the past three years. Over the last five years, PFE’s dividend payouts have grown at a 5.9% CAGR. Its four-year average dividend yield is 3.60%. PFE has paid dividends for 11 consecutive years.

The stock has declined 21.8% in price year-to-date, while it has gained 3.2% over the past year to close the last trading session at $45.94.

Here’s what could influence PFE’s performance in the upcoming months:

Robust Financials

PFE’s revenues increased 46.8% year-over-year to $27.74 billion for the second quarter that ended June 30, 2022. The company’s adjusted income increased 93.5% year-over-year to $11.65 billion. Its adjusted EPS came in at $2.04, representing an increase of 92.5% year-over-year. In addition, its Biopharma revenues increased 48.5% year-over-year to $27.42 billion.

Mixed Analyst Estimates

PFE’s revenue and EPS for fiscal 2022 are expected to increase 25.2% and 46.9% year-over-year to $101.74 billion and $6.49, respectively. However, its revenue and EPS for fiscal 2023 are expected to decline 24% and 21.7% year-over-year to $77.34 billion and $5.08, respectively. It surpassed Street EPS estimates in each of the trailing four quarters.

Higher-than-industry Profitability

In terms of trailing-12-month gross profit margin, PFE’s 62.75% is 15.2% higher than the 54.49% industry average. Likewise, its 42.97% trailing-12-month EBITDA margin is significantly higher than the industry average of 3.86%. Furthermore, the stock’s 38.05% trailing-12-month EBIT margin is significantly higher than the industry average of 0.61%.

Discounted Valuation

In terms of forward non-GAAP P/E, PFE’s 7.11x is 61% lower than the 18.26x industry average. Its trailing-12-month EV/EBITDA of 5.77x is 56.7% lower than the 13.32x industry average. Also, the stock’s 2.55x trailing-12-month P/S is 45.4% lower than the 4.67x industry average.

POWR Ratings Show Promise

PFE has an overall rating of A, equating to a Strong Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.

Our proprietary rating system also evaluates each stock based on eight distinct categories. PFE has an A grade for Value, consistent with its discounted valuation.

It has a B grade for Quality, in sync with its higher-than-industry profitability.

PFE is ranked #8 of 164 stocks in the Medical – Pharmaceuticals industry. Click here to access PFE’s ratings for Growth, Momentum, Stability, and Sentiment.

Bottom Line

Amid the economic uncertainties, investors could look to add PFE due to the highly inelastic demand for its products. The company has raised its guidance for the current year. It also beat its consensus EPS estimates in each of the trailing four quarters.

Given its robust financials, consistent dividend payments, discounted valuation, and higher-than-industry profitability, it could be wise to buy the stock now.

How Does Pfizer Inc. (PFE) Stack Up Against its Peers?

PFE has an overall POWR Rating of A, equating to a Strong Buy rating. You might want to consider investing in the following Medical – Pharmaceuticals stocks with an A (Strong Buy) or B (Buy) rating: Johnson & Johnson (JNJ - Get Rating), Merck & Co., Inc. (MRK - Get Rating), and Zoetis Inc. (ZTS - Get Rating).

Want More Great Investing Ideas?

3 Stocks to DOUBLE This Year


PFE shares fell $0.02 (-0.04%) in after-hours trading Friday. Year-to-date, PFE has declined -20.20%, versus a -18.22% rise in the benchmark S&P 500 index during the same period.


About the Author: Dipanjan Banchur


Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
PFEGet RatingGet RatingGet Rating
JNJGet RatingGet RatingGet Rating
MRKGet RatingGet RatingGet Rating
ZTSGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


Stock Market Update: It’s Complicated!

The S&P 500 (SPY) may have bounced 17% from recent lows, but the outlook for stocks from here is...in a word...COMPLICATED. Read on to get Steve Reitmeister full market outlook and trading plan for this complicated market environment.

Becoming More Bullish on Stocks, But...

Stocks are on a roll with the S&P 500 (SPY) up more than 10% from the recent lows. Before you start getting too giddy, you should read this updated market outlook and trading plan Steve Reitmeister.

Stock Market Held Hostage

Uncertainty is the term most often applied to this stock market. Uncertainty over tariffs. Uncertainty of whether the S&P 500 (SPY) will fall into bear territory. Uncertainty over what happens next. Steve Reitmeister dives into the uncertainty to make sense of the market in this week’s commentary...

Stock Market Standing on the 50 Yard Line

Steve Reitmeister contemplates where the stock market stands now and what happens next in trying to stay on the right side of the market action. One path points to bear and one to new highs for the S&P 500 (SPY). Which will it be?

Bear or Bull Market?

The S&P 500 is on the brink of bear market territory...but that outcome is not a given at this time. Steve Reitmeister shares insights gleaned from his 45 years of investing to shine a light on current conditions along with his top picks...

Read More Stories

More Pfizer Inc. (PFE) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All PFE News