Buy, Sell, Or Hold PFE Stock At $23?

Core Viewpoint - Pfizer's stock has declined approximately 25% from its 52-week high, primarily due to pipeline setbacks and management concerns regarding R&D spending and acquisitions [1][2][11] Valuation - Pfizer's current price-to-sales (P/S) ratio is 2.1, compared to 3.0 for the S&P 500, indicating it is slightly undervalued [8] - The price-to-free cash flow (P/FCF) ratio stands at 9.5 versus 20.5 for the S&P 500, and the price-to-earnings (P/E) ratio is 16.8 compared to 26.4 for the benchmark [8] Revenue Performance - Pfizer's revenues have seen a marginal decline over recent years, with an average shrinkage of 9.0% over the last three years, while the S&P 500 experienced a growth of 5.5% [8] - However, revenues grew by 11.7% from $60 billion to$64 billion in the last 12 months, outperforming the S&P 500's growth of 5.5% [8] Profitability - Pfizer's profit margins are around the median level for companies in the Trefis coverage universe, with an operating margin of 24.3% compared to 13.2% for the S&P 500 [8] Financial Stability - The company's balance sheet is considered weak, with a debt figure of $61 billion and a poor debt-to-equity ratio of 46.2$17 billion, yielding a cash-to-assets ratio of 8.3% versus 13.8% for the S&P 500 [13] Downturn Resilience - Pfizer's stock has historically underperformed the S&P 500 during market downturns, with a peak-to-trough decline of 57.3% from a high of $61.25 to$26.13 [14][15] - The stock has not yet recovered to its pre-crisis high, currently trading around $23 [14] Future Outlook - Despite current challenges, Pfizer has a robust pipeline, particularly in oncology, with potential blockbuster drugs that could enhance future revenues [12] - The acquisition of Seagen is beginning to positively impact sales and earnings, although it has not fully offset the revenue loss from COVID-19 products [10][12]