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Pfizer Inc. Message Board

  • hotpanera2 hotpanera2 Feb 11, 2012 6:40 AM Flag

    A rare nice word from Abelson -- about Pfe no less

    Yet he wrote this in today's Barron's:

    A SECTOR THAT WE'VE LONG liked but haven't featured with any frequency of late in this sacred space are the drug makers. It's no secret that many of the big pharma companies have had the sad experience of seeing their bestsellers come off patent and, in a flash, found themselves in a no-holds-barred price war with generic producers. Pfizer (ticker: PFE) and its lockbuster Lipitor leap to mind.

    If not exactly a sleeping giant, Pfizer has induced its share of snores among analysts, where opinion is split between the yawners who suggest it be sold and the tepid enthusiasts who kind of like it. We're attracted to the company precisely because nobody seems to be pounding the table for the stock, which has been rather a listless performer.

    As chance would have it, a favorable report on Pfizer from First Global crossed our desk last week. Kavita Thomas, who wrote the analysis, is to be commended for being upfront about the company's problems rather than simply rah-rah about its prospects. She's quick to point out that revenue fell in the fourth quarter, but it was better than she anticipated.

    Kavita also reports the Pfizer's pipeline is stuffed with promise. Just by way of illustration, the key data on its Alzheimer's drug bapineuzamab (try saying that aloud while chewing on a pretzel) will be revealed this year, its pneumococcal vaccine is slated to be released next month, and its kidney-cancer pill won recent approval.

    Sometime this year, too, the company will decide whether to sell or spin off its animal-health and nutrition businesses, both of which, she notes, enjoyed double-digit growth last year. Whatever their disposition, Pfizer is in line for a handsome return.

    Her forecast is for earnings of $2.27 a share this year and $2.34 next. Last we looked the stock was 21, so it's selling at only nine times estimated 2013 earnings, the lowest P/E among the majors, boasts strong operating cash flow and its shares yield more than 4%. Best of all, as we indicated, it's pretty much unloved.

    Comments? E-mail us at editors@barrons.com

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