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Pfizer: Undervaluation In The Post-COVID-19 Era

May 27, 2023 12:39 AM ETPfizer Inc. (PFE)35 Comments
Nathan Aisenstadt profile picture
Nathan Aisenstadt


  • Pfizer's revenue for the first three months of 2023 was $18.28 billion, down 24.7% from the previous quarter and 28.8% from the first quarter of 2022.
  • At the end of March 2023, Pfizer's total debt was about $36.17 billion, down substantially from 2021 despite several acquisitions.
  • In the first quarter of 2023, Oxbryta sales reached $71 million, reflecting a 28.6% increase from the previous year.
  • Despite the expected beginning of a period of turbulence in the stock market in the coming months, we continue our analytical coverage of Pfizer with an "outperform" rating for the next 12 months.
  • Pfizer's gross margin stood at 73.5% in Q1 2023, reaching its highest since the start of the COVID-19 pandemic, thanks to recent price increases for some of the company's blockbusters, lower raw material costs, and improved drug supply chains.

Одна чернокожая женщина делает тест на корону дома

tommaso79/iStock via Getty Images

On May 2, 2023, Pfizer (NYSE:PFE) released its financial results for the first quarter of 2023, which not only beat analysts' expectations but were able to demonstrate that demand for Paxlovid, an antiviral drug for the treatment of

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Nathan Aisenstadt profile picture
I am an independent research analyst focused on finding undervalued assets with above-average growth rates and developments that can dramatically improve the company's financial position. When investing, I use medium-term and long-term trading strategies that take into account psychological and behavioral variables and are able to mitigate the risks associated with macroeconomic and geopolitical instability.The main sectors of analysis are industrials, consumer staples, technology, and healthcare.When analyzing assets in the healthcare sector, in addition to examining their financial position, I delve into the safety and efficacy data of the company's product candidates from preclinical and clinical studies, allowing me to evaluate their commercial prospects. While the education received at the Hebrew University of Jerusalem contributes to a comprehensive and detailed analysis of biotechnological and physicochemical processes used in the production of goods in the agricultural, oil and gas, and chemical industries. As a result, it allows me to find the most promising assets in a rapidly changing market and publish meaningful articles on Seeking Alpha.My e-mail for any questions and suggestions: aisenathan@gmail.com

Analyst’s Disclosure: I/we have a beneficial long position in the shares of TAK either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

This article may not take into account all the risks and catalysts for the stocks described in it. Any part of this analytical article is provided for informational purposes only, does not constitute an individual investment recommendation, investment idea, advice, offer to buy or sell securities, or other financial instruments. The completeness and accuracy of the information in the analytical article are not guaranteed. If any fundamental criteria or events change in the future, I do not assume any obligation to update this article.

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Comments (35)

Nathan Aisenstadt profile picture

Thank you for reading our article and following us. We appreciate it. As promised, we began to publish an analysis of the companies from the list. We will post articles about Johnson & Johnson and Altria Group in the next two days.

Thank you all again.
Mean Reversion Investor profile picture
Just imagine if the Covid Jab was actually FDA approved and not EUA and Pfizer could have been sued for adverse effects and death. Stock o would be zero. Couldn’t have happened to a better company. 🤦🏼‍♂️
PFizer feels like a long term value trap with 26% down for the year. They are paying $43B for a $2B revenue company and ton of Debt and keep buying and loading onto Debt with . I am more excited about their weight loss drug than their debt piling

Thanks for the nice article. Started accumulating. What do you think the growth prospects are from these acquisitions? When is Seagen acquisition likely to bear fruit.
Nathan Aisenstadt profile picture
@Omicron2021 I think investors will begin to benefit from all the acquisitions made from the end of the first quarter of 2024. It takes a certain period to integrate them into Pfizer's business, and many clinical trial results are expected in 2024.

Thanks for the comment.
sandimas profile picture
Concern and uncertainty provides opportunities for patient investors. PFE has fallen enough for me to start building a position at $38. On the weekly chart it is oversold but no sign of a bottom. On the daily chart it is getting rejected a 2nd time by 50 day moving average but with technicals improving.

These charts tell me PFE may retest 200 day moving average around $42 this summer, but ultimately I am looking for a lower low to fill out my long-term position around $32 to $35.
Own Pfizer but not confident in its aggressive acquisitions especially Seagen at approximately 85x sales and unprofitable. Pfizer now has a lot of debt along with a bludgeoning number of outstanding shares and multiple acquisitions that hopefully will grow into productive products. Management has spent about 70 billion for companies prospective drugs. Prospects can easily turn into suspects.
Not a comfortable bet .
Nathan Aisenstadt profile picture
@Jlexus1953 Partly agree with you.

At the time, Pfizer needed to acquire something large, with a rich portfolio of drugs to treat patients in areas where unmet therapeutic needs remained.

As the article pointed out, in the short term, this acquisition will create pressure on the company's EPS, but due to the expansion of indications for the use of Seagen's medicines, the synergistic effect, etc., Pfizer has every chance to regain lost positions in the global oncology drugs market.

Thanks for the comment.
Too risky with the new debt.
Nathan Aisenstadt profile picture
@katmandu100 Greetings.

Thanks for the comment.
less risky than overhyped and overvalued AI stocks
astute pathways profile picture
I have been accumulating PFEL...It moves 2X the price of PFE.
Nathan Aisenstadt profile picture
@astute pathways Greetings.

Thanks for the info. I'll take a look at this ETF over the weekend.
Willow Street Investments profile picture
Pfe is the glw of pharma
ronald61239 profile picture
PFE could get a bounce in share price after the debt crises is resolved. I will wait untill after the 2nd Qt. report to add to my position.. Near term results may be negative for the market.
Nathan Aisenstadt profile picture
@ronald61239 Greetings.

Thanks for your thoughts.
Down 26%, YTD, low valuation and a nice yield on PFE.
Nathan Aisenstadt profile picture
@Money 29 Greetings.

I agree with you. Even with the end of the COVID-19 pandemic, Paxlovid sales were $4,069 million in Q1 2023. In addition, it should be taken into account that a new wave is starting in China, which will also positively impact the company's revenue.

ndardick profile picture
From one Nathan to another, I agree 100% and thus have been accumulating PFE so that it's now a full position in our family's fairly concentrated portfolio of only 25 stocks. I feel fortunate that I sold the entire position in PFE close to $60 and that I had a chance to buy it all back with an average cost of $40. If it unexpectedly dips below $35, I plan to buy even more.
Nathan Aisenstadt profile picture
@ndardick Greetings.

As always, I'm glad to read a comment from you. It seems to me that Pfizer is becoming one of the most undervalued assets among the largest pharmaceutical companies.
ndardick profile picture
@Nathan Aisenstadt Much appreciated. I agree with you. Sometimes stocks that fall in price become riskier because their prices are falling for a fundamental reason, but in the case of PFE it is becoming a safer investment (and its dividend yield rises) as it falls in price. PFE does not get the love that is bestowed on the likes of MRK and LLY, but from my perspective as a value investor PFE is the better choice of the three.
Nathan Aisenstadt profile picture
@ndardick Agree.

Thank you.
Thanks for the article. Do you have a price target range for PFE, and if so, what metrics are you using to arrive at that range?
What is better to buy, Pfizer or Merck? I like Merck because of the growing sales of Keytruda.
Has anyone been vaccinated against COVID-19 this year? I don't know which vaccine to choose.
Nathan Aisenstadt profile picture
@gold_alex Greetings.

It is best to consult your doctor for advice.

Thanks for the comment.
hugh74jones profile picture
PFE has been a long term favorite of mine, especially in the options market; where I sell PFE puts, and profitably to date. PFE is currently oversold on basis of declines in last 6 months and more --- definitely over done, regardless of covid-19, now used in past tense. Persons seeking long positions should gradually buy now, and average down, if PFE declines any further. Certainly, your risk now in acquiring PFE is much less than when PFE was in 50s and 40s!
Nathan Aisenstadt profile picture
@hugh74jones Greetings.

Completely agree with you.

Thanks for the comment.
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