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Pfizer (PFE) Q4 Earnings Coming Up: What's in the Cards?

Zacks Equity Research

Pfizer, Inc. PFE will report its fourth-quarter 2019 results on Jan 28, before market open. In the last reported quarter, the company delivered a positive earnings surprise of 19.05%.

This pharma giant’s earnings surpassed expectations in each of the last four quarters, with the average positive surprise being 8.73%.

Pfizer Inc. Price and EPS Surprise

 

Pfizer Inc. Price and EPS Surprise

Pfizer Inc. price-eps-surprise | Pfizer Inc. Quote

Pfizer’s shares have declined 4.7% in the past year against an increase of 14.7% for the industry.

Factors at Play

Higher sales of Pfizer’s key brands, Eliquis, Xeljanz, Inlyta, Ibrance in the Biopharma segment, biosimilars and strong emerging market sales are likely to have made up for lower sales in the Upjohn group. Within the Biopharma group, the Zacks Consensus Estimate for oncology and vaccine products is $2.58 billion and $1.67 billion, respectively. The Zacks Consensus Estimate for the Upjohn group is $2.13 billion.

However, sales of some key drugs like Prevnar 13/Prevenar 13 and Enbrel declined in the past two quarters. It remains to be seen if sales of these drugs have improved this time around. 

In the Upjohn segment, sales of key drug Lyrica are likely to have declined due to multi-source generic competition that began in July 2019. Viagra sales are likely to have declined due to generic competition that began in December 2017.

Meanwhile, Pfizer’s sterile injectables portfolio showed a recovery in the third quarter as Pfizer’s manufacturing recovery efforts started taking shape. The portfolio had been seeing lower revenues since the last few quarters due to persistent legacy Hospira product shortages in the United States. It remains to be seen if the improved sales continued in the fourth quarter.

Importantly, in July 2019, Pfizer announced a definitive agreement stating that it will spin off its Upjohn unit and combine it with generic drugmaker Mylan MYL in a Reverse Morris Trust transaction to create a generic pharmaceutical company to be called Viatris. An update is expected on the conference call.

What Our Model Indicates

Our proven model does not conclusively predict an earnings beat for Pfizer this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Earnings ESP: Its Earnings ESP is -1.02%. The Zacks Consensus Estimate stands at 57 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Pfizer carries a Zacks Rank #1.

Stocks to Consider

Here are some large drug/biotech stocks that have the right combination of elements to beat on earnings in their upcoming release:

Merck MRK has an Earnings ESP of +1.05% and a Zacks Rank #3. The company is scheduled to release results on Feb 5. You can see the complete list of today’s Zacks #1 Rank stocks here.

AstraZeneca AZN has an Earnings ESP of +3.31% and a Zacks Rank #3. The company is scheduled to release results on Feb 14.

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Merck & Co., Inc. (MRK) : Free Stock Analysis Report
 
Pfizer Inc. (PFE) : Free Stock Analysis Report
 
AstraZeneca PLC (AZN) : Free Stock Analysis Report
 
Mylan N.V. (MYL) : Free Stock Analysis Report
 
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