The company’s future is gradually appearing more promising. Over the past three years, Pfizer (PFE) has faced challenges as its revenue, earnings, and stock price have generally declined. Nonetheless, the pharmaceutical company has achieved some progress in clinical and regulatory matters, gaining several new approvals.
Recently, Pfizer’s financial performance has shown improvement. The company experienced a downturn in revenue, largely due to a steep decline in coronavirus-related sales. Despite this decline, it signified a positive indication of a waning pandemic for the broader public. However, with COVID-19 persisting, Pfizer’s third-quarter sales in this segment have contributed positively, helping to reverse its trajectory.
In the third quarter, Pfizer reported $17.7 billion in revenue, marking a 31% year-over-year increase, an impressive feat for a pharmaceutical leader. Its COVID-19 therapeutic, Paxlovid, significantly boosted its revenue, generating $2.7 billion compared to just $202 million in the same quarter of 2023. Sales of Comirnaty, Pfizer’s well-known vaccine, also rose 9% year over year to $1.4 billion.
Furthermore, Pfizer’s acquisition of Seagen in December 2023 played a notable role in its improved performance, underscoring the ongoing significance of its efforts in the COVID-19 domain. As a result, the company has adjusted its revenue and earnings-per-share (EPS) forecasts for the fiscal year 2024, anticipating higher sales for these products. Initially, Pfizer projected revenue between $59.5 billion and $62.5 billion and adjusted EPS between $2.45 and $2.65. Now, it expects revenue to range from $61 billion to $64 billion, with EPS between $2.75 and $2.95.
Pfizer’s revenue from its COVID-19 portfolio is expected to be cyclic, given that vaccinations are more likely during fall and winter. However, Pfizer’s potential extends well beyond this particular product line, as it boasts an extensive portfolio and a robust pipeline of over 100 programs.
Like other pharmaceutical companies, Pfizer is aiming to establish a presence in the weight loss market. Its management has indicated that an oral anti-obesity medication could become the second of its kind available to consumers. The need for oral options arises as current leaders in the field, such as Wegovy and Zepbound, require weekly injections. A daily oral pill is preferable for many patients, and Pfizer is focused on developing this option. One candidate, danuglipron, is currently in phase 2 trials, alongside several other early-stage candidates. The weight loss market is predicted to experience significant growth, potentially exceeding $150 billion by the early 2030s.
Additionally, Pfizer is set to enhance its endeavors in oncology, a sector it intends to expand following the Seagen acquisition. With a goal of becoming a leader in the oncology field, one of the industry’s largest therapeutic areas, Pfizer is poised to capitalize on Seagen’s established reputation with newfound support, which could strengthen its position further.
Although a full recovery will take time, Pfizer has already laid a solid foundation for future achievements. Investments in its pipeline, strategic acquisitions funded by its COVID-19 revenue, and the divestment of non-performing segments are expected to gradually yield results. Moreover, Pfizer remains an appealing choice for income-seeking investors, offering a forward yield of 5.9% with dividend payments having increased by over 61% in the past decade, making it a sound investment for those with a long-term outlook.