PFE

Pfizer Inc

Healthcare


Presented:04/04/2019
Price:$42.74
Cap:$237.28B
Current Price:$29.44
Cap:$166.83B

Presented

Date04/04/2019
Price$42.74
Market Cap$237.28B
Ent Value$275.92B
P/E Ratio14.01x
Book Value$11.09
Div Yield3.37%
Shares O/S5,551.81M
Ave Daily Vol24,838,675
Short Int1.86%

Current

Price$29.44
Market Cap$166.83B
Pfizer Inc. engages in the discovery, development, and manufacture of healthcare products specializes in medicines, vaccine, and consumer healthcare. It operates through the Pfizer Innovative Health (IH) and Pfizer Essential Health (EH) segments. The IH segment focuses on the development and commercializing medicines and vaccines for internal medicine, oncology, inflammation and immunology, rate disease, and consumer healthcare. The EH segment is involved in development and supply of branded generics, generic sterile injectable products, biosimilars, and select branded products including anti-infectives. The company was founded by Charles Pfizer Sr. and Charles Erhart in 1849 and is headquartered in New York, NY.

Publicly traded companies mentioned herein: AbbVie Inc (ABBV), Bristol-Myers Squibb Company (BMY), Celgene Corporation (CELG), Eli Lilly & Co (LLY), Gilead Sciences Inc (GILD), Novartis AG (NVS; NOVN SW), Pfizer Inc (PFE), Teva Pharmaceuticals Industries Ltd (TEVA)

Highlights

The presenter is short shares of Pfizer (PFE) due to slowing growth in emerging markets, an unimpressive pipeline of existing products, and an impending “massive” patent cliff (2026 - 2027). The stock has had a good run over the past few years, rising to the low $40s from ~$30, all the while paying an attractive yield; however, as Pfizer now stands it does not have much to offer on the upside based on its pipeline and Street forecasts. The risk/reward should be favorable for a large, liquid pharma name, but it is not intended to be a “big short (i.e., PFE shouldn’t blow up).” Rather, concerns about the commercial products losing patent exclusivity will start to creep into the narrative and models, growth will slow, and the multiple would contract in this scenario (resulting in ~20% downside based on ~3 turns of P/E multiple compression).

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Idea Discussion

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