Pfizer Stock Loses $43 Billion in Value in Worst Month Since 2009
After investors bid up the company's stock throughout the COVID-19 pandemic, Pfizer's share price has recently been falling back to Earth.
Pfizer (NYSE: PFE) has brought in millions of dollars since the pandemic’s start due to the vaccines and other treatments it offers for COVID-19. However, those revenue streams are drying up now that most of the population has been vaccinated, and the pandemic appears to be mainly in the rearview mirror. Investors seem worried about weak guidance for 2023, which the company confirmed in their earnings release on Tuesday.
Additionally, Pfizer faced increased competition in the market, particularly from generic drug makers who can offer similar products at a lower price. This has put pressure on the company’s profitability and has been a critical factor in its share price decline since the pandemic peak.
While the guidance for 2023 was considered negative for the stock, the company’s fundamentals during FY2022 were promising. Pfizer generated $100.3 billion for the year, an all-time high and up 30% from the prior year. Q4 revenue was $24.3 billion, a 13% increase. This strong revenue growth translated to strong profitability, with full-year EPS coming in at $5.47, up 42% year over year; in Q4, EPS came in at $0.87, up 48%. The decline in Pfizer’s stock has accelerated over the last month, with the company losing 14% or $43 billion in market value.
Pfizer’s Chairman and CEO, Dr. Albert Bourla, commented on the company’s results and expectations for 2023, stating:
“2022 was a record-breaking year for Pfizer, not only in revenue and earnings per share, which were the highest in our long history, but more importantly, in terms of the percentage of patients who have a positive perception of Pfizer and the work we do…As we turn to 2023, we expect to once again set records, with potentially the largest number of new product and indication launches that we’ve ever had in such a short period of time.”
After the recent decline, the stock is looking attractive as a value stock. The company’s P/E of 8.5 is well below other pharmaceutical giants like AbbVie (NYSE: ABBV) and Merck (NYSE: MRK), whose ratios are 19.2 and 17.6, respectively. The stock also pays an above-average dividend yield of 3.7%.
Shares of Pfizer are currently trading at $43.78 per share, down 0.61% on the day. YTD, PFE stock is down 14.59%.
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