Pfizer (NYSE: PFE) isn’t exactly a top-performing stock at the moment. Over the past three years, Pfizer’s shares have seen a total return decline of 19%, while the S&P 500 has surged by over 32%. During this period, its trailing 12-month revenue has only seen a modest 6% increase, reaching $58.5 billion, while net income has plummeted by 83%, hitting $2.1 billion.
Furthermore, Pfizer carries a substantial $75.3 billion in debt and capital lease obligations. Although it should be able to manage its debt over time, interest expenses will likely continue to weigh down earnings growth for the foreseeable future.
So, should investors consider buying Pfizer Stock?
Despite its current challenges, Pfizer stock has seen some recent successes. Last month, the European Commission approved Pfizer’s Prevnar 20 vaccine, aimed at protecting babies and children from pneumococcal disease. Additionally, Pfizer’s acquisition of Seagen in December has led to the development of a promising new drug, Adcetris, which has shown significant improvement in overall survival rates for patients with certain forms of lymphoma. Pfizer is also pursuing FDA approval for Adcetris, marking its potential eighth approval.
Pfizer’s robust pipeline, particularly in oncology, is a key driver of optimism. With 31 programs in phase 3 clinical trials and 34 programs in phase 2 trials, Pfizer anticipates the potential launch of at least eight blockbuster medicines by 2030. This signifies substantial revenue potential, with each blockbuster drug capable of generating over $1 billion annually.
While investors may need to exercise patience as Pfizer’s new revenue streams mature, the stock presents a compelling investment opportunity. Pfizer’s longevity in the pharmaceutical industry and its track record of successfully commercializing breakthrough medicines across various economic landscapes make it a solid long-term investment.
