Pfizer's stock has undergone a significant transformation in recent years, from trading at about $60 by the end of 2021 to currently less than $30, sparking concerns among investors about the company's future trajectory.
The company's challenges extend beyond its COVID drugs, with sales in specialist care and its cancer division showing mixed performance. While some products like Eliquis and Vyndaqel have exhibited positive growth, overall revenue fell by more than 41% in the final quarter of 2023, resulting in a $3.4 billion net loss.
Despite Pfizer's acquisition of Seagen's oncology business for $43 billion, the company's sales projections for the current year indicate little to no growth, reflecting the uncertainty surrounding its future amid growing competition and patent expirations. While Pfizer presents a long-term investment opportunity at discounted stock prices, investors must be prepared for significant risks and a potentially lengthy turnaround period.
In a few years, a lot can happen in the stock market, and Pfizer is a prime example. By the end of 2021, the COVID-19 vaccine manufacturer was doing well, with its shares trading at about $60. In 2022, it would break the record with an annual revenue of above $100 billion.
(Photo : by BENOIT DOPPAGNE/BELGA MAG/AFP via Getty Images)In a few years, a lot can happen in the stock market, and Pfizer is a prime example. By the end of 2021, the COVID-19 vaccine manufacturer was doing well, with its shares trading at about $60. In 2022, it would break the record with an annual revenue of above $100 billion.
Currently, the share price of the stock is less than $30. Fear and worry have taken the place of the previous enthusiasm and hoopla surrounding the stock as investors wonder what lies ahead for the company.
Its COVID-19 product revenue probably won't be as high as it was in 2022. However, Pfizer's issues go far further.
Pfizer released its quarterly results for the final three months of 2023 on January 30, and they weren't very good. Revenue fell by more than 41% year over year to barely $14.2 billion. Additionally, the business had a $3.4 billion net loss, mostly as a result of a revenue reversal pertaining to its COVID medication, Paxlovid.
Pfizer's Growth Challenges and Long-Term Prospects
Pfizer is having difficulties with more than only its COVID drugs, despite the fact that most investors are probably aware of these issues. Sales of specialist care only increased by 11% during the previous quarter, while its cancer division saw a 3% dip.
Eliquis, an anticoagulant drug, was the sole product to exhibit positive year-over-year growth and sales of over $1 billion. Although Pfizer's top products haven't always produced positive results, the company's Vyndaqel brand, which helps treat transthyretin amyloidosis, a protein condition, came close with sales jumping by 41% to $961 million.
Pfizer is only predicting sales to be between $58.5 billion and $61.5 billion for this year, which would be little to no growth from the $58.5 billion it predicted for 2023. This is alarming because Pfizer just acquired the oncology business Seagen for $43 billion.
Pfizer has a difficult path ahead of it due to growing competition and patent cliffs. Additionally, although acquisitions will strengthen the firm's pipeline and offer some optimism that the top line may benefit in the future, the company still faces uncertainty on this road, which has discouraged investors from joining it. The stock of healthcare companies has dropped by 39% during the last 12 months.
The firm undergoing change, and it could take a while for it to start growing again. However, if you're prepared to take a chance on the business, Pfizer's stock is now selling at levels it hasn't seen since 2014, making it one of the best long-term bets. The investment carries considerable risk, but for those who are patient, there might be huge rewards.
