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By Charles Delvalle

GlaxoSmithKline (NYSE:GSK) added to Pfizer’s (NYSE:PFE) woes Friday with a new assault on the anti-smoking pill market, previously dominated by Pfizer’s Chantix. Chantix has been losing ground since January, when US regulators warned about suicide risks connected with the drug.

I typically don’t cover pharmaceutical stocks because, in all honesty, the sector bores me a little. Something about hormones and cells just puts me to sleep. But I couldn’t pass up the one Frank Y. wanted me to cover…

I liked your comments on GE (NYSE:GE).

Is Pfizer in the same position, is it a falling knife, or has it bottomed?

Pfizer – the maker of the ever-popular little blue pill. Describing them as a falling knife, though, is extremely appropriate. When you look at their chart, you should stretch it out as far as possible. That’s because this company is trading lower than any point in the last ten years.

But why?

Earnings dropped 17% last quarter and revenue dropped 5%. Why? They lost market exclusivity for Zoloft and Norvasc. This loss comes after they reduced their workforce by 10,000 people.

But the company is trying to right the ship. Revenues dropped only slightly, they’re buying back stock (last year they bought $10 billion) and they increased their dividend.

With all that said, I think Pfizer is a strong company, has a few promising drugs in phase 3 studies and should do well in the future. Unfortunately, the uncertainty all of these changes bring is forcing their share price lower.

Right now, the best thing to do is let Pfizer (PFE) slide for a while. In the next year, they could be an amazing buy.

Disclosure: none

Source: Pfizer: Ride or Let Slide?