Topline
Pfizer comfortably beat expectations in its quarterly earnings report Wednesday morning, as the American pharmaceutical giant attempts to regain its footing as the COVID-19 pandemic subsides.
Pfizer CEO Albert Bourla is navigating his company through a trying time.
Key Facts
Pfizer’s $0.55 diluted earnings per share and $14.9 billion in first-quarter sales smashed respective forecasts of $0.51 and $13.87 billion, according to average analyst estimates.
With Pfizer’s top line down 20% and its bottom line down 44%, it’s the fifth consecutive quarter of year-over-year declines in both revenue and net income.
The company affirmed its full-year 2024 guidance of $58.5 billion to $61.5 billion in sales and upped its bottom line guidance to $2.15 to $2.35 earnings per share, with the latter’s $2.25 midpoint coming in just above consensus estimates of $2.21.
Shares of Pfizer rose 4% in pre-market trading, still nursing a 35% loss over the last 12 months, excluding dividends.
Big Number
66%. That’s how much lower Pfizer’s sales were for its COVID-19 Comirnaty vaccine and Paxlovid oral treatments during 2024’s first quarter ($2.4 billion) than they were in 2023’s comparable period ($7.1 billion).
Contra
Pfizer’s negative profit and sales growth have sent many investors to the hills, but it has one major factor working in its favor to intrigue those courageous enough to buy the dip: Dividends. The firm’s $0.42 quarterly cash dividend offers a 6.6% annual dividend yield based on its $25.62 Tuesday closing share price, a remarkably high payout in today’s low-dividend environment. Pfizer’s yield is the sixth-highest of any S&P 500 company and is more than four times higher than the roughly 1.4% aggregate yield for the S&P.
Key Background
Last week, Pfizer’s share price hit its lowest level since 2012, on a split-adjusted basis. Pfizer’s revenues for its COVID-19 series are a tiny fraction of their peak of $17 billion during 2022’s second quarter, as government subsidies dried up while the pandemic eased. The decline greatly contributed to the downright carnage seen in Pfizer’s financials, with the company generating its least amount of cash since 2000 last year. Pfizer’s market capitalization has collapsed from its 2021 peak of nearly $350 billion to $150 billion, a slide coinciding with exploding valuations for several of its healthcare peers, most notably weight-loss drug leaders Eli Lilly and Novo Nordisk. The market valued Pfizer more than $60 billion higher than both Eli Lilly and Novo Nordisk at the end of 2021, a fairly shocking fact considering Eli Lilly’s current $473 billion market value and Novo Nordisk’s $573 billion are more than three times higher than Pfizer’s. As investors eat up the potential of weight-loss drugs, Pfizer has yet to convince the market of its own progress in the space, announcing in December it pulled its trial for a twice-a-day pill due to adverse side effects.
