Pfizer's Golden Cross Signals Strength: How to Play the Stock

Core Insights - Pfizer's stock has been trading above its 50-day and 200-day simple moving averages since mid-August, indicating a potential upward trend with a "golden cross" formation [1][2][9] Group 1: Financial Performance - Pfizer's oncology revenues grew by 9% in the first half of 2025, driven by key drugs such as Xtandi, Lorbrena, Braftovi-Mektovi combination, and Padcev [5] - The company expects a revenue CAGR of approximately 6% from 2025 to 2030, with the acquisition of Seagen projected to contribute over $10 billion in risk-adjusted revenues by 2030 [11] - Pfizer's recently launched and acquired products generated $4.7 billion in revenues in the first half of 2025, reflecting a 15% operational increase compared to the previous year [10] Group 2: Product Pipeline and Strategy - Pfizer is advancing its oncology clinical pipeline with several candidates in late-stage development, including sasanlimab, vepdegestrant, and sigvotatug vedotin [6] - The company is also expanding the labels of its approved products across oncology and non-oncology categories [7] Group 3: Challenges and Risks - Sales of COVID-related products, Comirnaty and Paxlovid, are expected to decline significantly from $56.7 billion in 2022 to around $11 billion in 2024, with ongoing uncertainty regarding future sales [12] - Pfizer anticipates a moderate negative impact on revenues due to loss of exclusivity (LOE) for several key products between 2026 and 2030 [13] - The company expects an unfavorable impact of approximately $1 billion from the Medicare Part D redesign under the IRA, affecting higher-priced drugs [14] Group 4: Valuation and Market Position - Pfizer's stock is trading at a forward price/earnings ratio of 7.98, significantly lower than the industry average of 14.78 and its own 5-year mean of 10.75 [18] - The Zacks Consensus Estimate for earnings has increased for both 2025 and 2026, indicating positive sentiment around the company's financial outlook [21] Group 5: Future Outlook - Pfizer is implementing cost cuts and internal restructuring aimed at delivering savings of $7.7 billion by the end of 2027, which should drive profit growth [25] - The company maintains a high dividend yield of around 7%, making it attractive for long-term investors despite current stock price declines [26]