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Pfizer (PFE) Gains As Market Dips: What You Should Know

Zacks Equity Research

Pfizer (PFE) closed at $36.30 in the latest trading session, marking a +0.53% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.14%. Elsewhere, the Dow lost 0.11%, while the tech-heavy Nasdaq lost 0.1%.

Coming into today, shares of the drugmaker had lost 3.14% in the past month. In that same time, the Medical sector lost 3.51%, while the S&P 500 lost 0.91%.

PFE will be looking to display strength as it nears its next earnings release, which is expected to be October 29, 2019. The company is expected to report EPS of $0.63, down 19.23% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.22 billion, down 8.07% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.81 per share and revenue of $50.98 billion, which would represent changes of -6.33% and -4.97%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for PFE. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.12% higher. PFE currently has a Zacks Rank of #3 (Hold).

In terms of valuation, PFE is currently trading at a Forward P/E ratio of 12.84. For comparison, its industry has an average Forward P/E of 14.38, which means PFE is trading at a discount to the group.

Investors should also note that PFE has a PEG ratio of 2.87 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 2.08 as of yesterday's close.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 101, which puts it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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