Any owners of PFE/Pfizer.. Question about possible trade...

[mikes425]

Another miraculously bad small gamble on my part in recent years has been PFE/Pfizer.  Now sitting at around 50% loss on a modest investment and
can't see any sign of this apparent dog having anything spectacular in the pipeline.  Meanwhile LLY and others are verging on announcements about 
a pill version of the injectable weight loss drugs which logically stand to propel their inflated prices even higher.  Anyone have a take on this sector?
Healthcare sector generally - at least in my case with GRX (healthcare sector ETF) hasn't been profitable the past year but I'm weighing whether to
liquidate what's left of my PFE holding into an alternative health sector position.  Any thoughts or opinions greatly appreciated.

[newtecher]

I am sitting on a 20% loss. No one knows the future but selling at these prices and replacing it with another pharma stock will likely be a classic mistake of selling low and buying high. PFE is trading for about 10x forward earnings. Since you mentioned LLY, take a look at where it traded in 2010 or so. It was a dog, also trading at about 10x earnings, with patents expiring and declining earnings. Terribly similar to PFE right now. I am not saying PFE will go up a factor of 20 in the next 10 years since drug development is to a large extent a lottery. Still, the downside is very limited from here, the dividend is about 5% and looks safe. The upside is potentially large as new drugs get developed. PFE is working on a weight loss pill (as opposed to weekly injections of semiglutide developed by LLY and NVO). This pill may pay off or something else entirely may pay off.

[win1177]

Nov 14, 2023 14:31:49 GMT newtecher said:

I am sitting on a 20% loss. No one knows the future but selling at these prices and replacing it with another pharma stock will likely be a classic mistake of selling low and buying high. PFE is trading for about 10x forward earnings. Since you mentioned LLY, take a look at where it traded in 2010 or so. It was a dog, also trading at about 10x earnings, with patents expiring and declining earnings. Terribly similar to PFE right now. I am not saying PFE will go up a factor of 20 in the next 10 years since drug development is to a large extent a lottery. Still, the downside is very limited from here, the dividend is about 5% and looks safe. The upside is potentially large as new drugs get developed. PFE is working on a weight loss pill (as opposed to weekly injections of semiglutide developed by LLY and NVO). This pill may pay off or something else entirely may pay off.

Agree! I’m a long term holder of Pfizer, and recently added to our position. I think the “downside” risk is fairly low, considering a strong yield and a dividend that is well covered. Also, they have a good long term research “pipeline” and should (eventually) develop (or purchase) some new drug candidates that will become their new blockbusters. Meanwhile, you get paid a reasonable dividend to wait. I’m holding, may even add more if it comes down some more.

Win

[bb2]

I own some, fairly good size position but I don't like it. (I don't like much except US tech and biotech takes too much work, or should, as I've been neglectful.) The pandemic was a bubble for so many stocks and I should have exited but it's just been there in my portfolio for years - ballast I guess. (Ballast - synonym for dog, though that can change, as we've seen with bonds' recent little time in the spotlight.) (I no longer re-invest PFE divs.)

Some notes I took after last QTR:

Paxlovid is done - taking 7.9 million doses back from the gov.
Cost cutting $3.5B
Cut $9 B from 1 yr guidance

Third-quarter sales fell 42% to $13.2 billion, Pfizer said Tuesday in a statement, short of the Wall Street view of $13.5 billion. The company posted a loss of 17 cents a share on an adjusted basis, compared with the average estimate for a loss of 33 cents. The quarterly loss was Pfizer’s first on an adjusted basis in more than three decades, according to data compiled by Bloomberg.

Sales of its Covid booster fell 70% to $1.31 billion, around $200 million short of analysts’ expectations, and Paxlovid sales tumbled 97% to $202 million, missing the mark by nearly $170 million. Questions remain about the prospects for Paxlovid, as well as whether the drugmaker’s expectation for a 17% vaccination rate with the latest Covid boosters is too optimistic.


The company also awaits US regulatory approval for its $43 billion acquisition of cancer biotech firm Seagen Inc. The deal got unconditional support from European Union regulators, suggesting it may not face much US scrutiny.

As for Pfizer’s other drugs, blood-thinner Eliquis narrowly missed estimates with sales of $1.5 billion in revenue. Ibrance, a breast cancer treatment, met expectations of $1.24 billion in sales. A group of shots to protect against pneumonia beat estimates with sales of $1.85 billion. Pfizer’s sales of its new RSV vaccine were $375 million in the quarter, its first full three months on the market.

Analysts are closely following the development of Pfizer’s experimental obesity pill danuglipron that’s expected to yield mid-stage clinical trial data this year. The company expects to have data on “the best formulation option” early next year, Pfizer’s chief scientific officer Mikael Dolsten said on the earnings call.

Pfizer also moved another new small molecule to treat type 2 diabetes into an early-stage trial. Pfizer is building a new platform around the GLP area and obesity “with multiple different mechanisms and compounds,” Dolsten said.

“The road ahead remains challenging” for Pfizer, Citi’s Andrew Baum wrote in a note. In addition to the Covid franchise downturn, the expensive Seagen purchase has potential for “talent-loss post integration,” he said.

From Seeking Alpha
Dividend Safety B The company's ability to continue paying current dividend amount.
Dividend Growth A- The attractiveness of the dividend growth rate when compared to peers.
Dividend Yield A+ The attractiveness of the dividend yield compared to peers.
Dividend Consistency AThe company's track record for paying consistent dividends.

[mikes425]

Nov 15, 2023 18:45:42 GMT bb2 said:

I own some, fairly good size position but I don't like it. (.....

Some notes I took after last QTR:

Paxlovid is done - taking 7.9 million doses back from the gov.
Cost cutting $3.5B
Cut $9 B from 1 yr guidance

Third-quarter sales fell 42% to $13.2 billion, Pfizer said Tuesday in a statement, short of the Wall Street view of $13.5 billion. The company posted a loss of 17 cents a share on an adjusted basis, compared with the average estimate for a loss of 33 cents. The quarterly loss was Pfizer’s first on an adjusted basis in more than three decades, according to data compiled by Bloomberg.

Sales of its Covid booster fell 70% to $1.31 billion, around $200 million short of analysts’ expectations, and Paxlovid sales tumbled 97% to $202 million, missing the mark by nearly $170 million.

“The road ahead remains challenging” for Pfizer, Citi’s Andrew Baum wrote in a note. In addition to the Covid franchise downturn, the expensive Seagen purchase has potential for “talent-loss post integration,” he said.

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Sure seems like the kind of performance that would be grounds for a major management change at most companies but perhaps there's an unexpected surprise in the pipeline... tho i've said that for a few years now about PFE and nothing appears to be on the horizon.