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Pfizer (PFE) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Pfizer (PFE) closed at $32.64, marking a +1.87% move from the previous day. The stock outpaced the S&P 500's daily gain of 1.47%. Meanwhile, the Dow gained 2.32%, and the Nasdaq, a tech-heavy index, added 1.2%.

Heading into today, shares of the drugmaker had lost 16.08% over the past month, lagging the Medical sector's loss of 0.38% and the S&P 500's gain of 0.74% in that time.

Investors will be hoping for strength from PFE as it approaches its next earnings release, which is expected to be July 28, 2020. The company is expected to report EPS of $0.64, down 20% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.94 billion, down 10.01% from the year-ago period.

PFE's full-year Zacks Consensus Estimates are calling for earnings of $2.88 per share and revenue of $48.82 billion. These results would represent year-over-year changes of -2.37% and -5.67%, respectively.

It is also important to note the 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.82% higher. PFE is currently a Zacks Rank #3 (Hold).

Digging into valuation, PFE currently has a Forward P/E ratio of 11.13. Its industry sports an average Forward P/E of 14.63, so we one might conclude that PFE is trading at a discount comparatively.

Investors should also note that PFE has a PEG ratio of 2.51 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Large Cap Pharmaceuticals was holding an average PEG ratio of 2.08 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 29, which puts it in the top 12% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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