Which Pharma Stock Is the Better Bargain Buy: Pfizer or Eli Lilly?

Pfizer Analysis - Pfizer's trailing-12-month operating income is $1.3 billion, down 94$1 billion stake in Pfizer, and management is pursuing cost cuts to reduce annual expenses by 4 billion by the end of 2024 [4] - Pfizer's long-term strategy focuses on R&D and business development, particularly in cancer drugs, with recent acquisitions like Seagen aimed at bolstering growth by 2030 [4] - Pfizer's shares are considered undervalued, with potential for a turnaround in profitability through cost cuts and pipeline successes [8] Eli Lilly Analysis - Eli Lilly's trailing-12-month normalized diluted EPS grew 60% over the last three years, reaching 12.13, driven by strong growth in its type 2 diabetes and obesity therapies, Mounjaro and Zepbound [5] - Zepbound generated over $1.2 billion in sales in Q2 alone, with demand outpacing manufacturing capacity, leading to significant investments in production [5] - Eli Lilly's pipeline includes numerous mid- and late-stage candidates, with a focus on cardiometabolic drugs and other segments [6] - Eli Lilly's EV/R ratio is 21.8, P/B multiple is 60.7, and P/E multiple is 112.7, significantly higher than the pharma industry average of 28.5 [7] - Wall Street analysts project Eli Lilly's EPS will grow 42% annually in the long term, justifying its high valuation [7] Comparison and Conclusion - Pfizer is currently the better bargain compared to Eli Lilly, though it carries higher risk due to its current underperformance [8] - Pfizer's undervaluation presents an opportunity for investors if the company successfully executes its turnaround strategy [8]