The Motley Fool·2025-12-12 15:15Core Viewpoint - Pfizer and Bristol Myers Squibb are currently out of favor in the market, but Pfizer may present a better turnaround opportunity for long-term investors [1] Company Comparisons - Comparing companies is essential for understanding their relative value; for instance, Eli Lilly's P/E ratio is nearly 50, while Bristol Myers Squibb's is just over 17 and Pfizer's is under 15 [4] - Eli Lilly's strong performance is attributed to its leading position in the GLP-1 weight loss market, while Pfizer has faced setbacks and has had to pursue acquisitions to enhance its drug pipeline [5][6] Patent Cliffs - Both Pfizer and Bristol Myers Squibb are facing upcoming patent cliffs, which raises investor concerns about potential revenue declines; in contrast, Eli Lilly may not face a significant patent cliff for over a decade [9] Investment Considerations - Bristol Myers Squibb offers a safer investment profile with a dividend yield of nearly 4.8% and a payout ratio of approximately 85%, while Pfizer's yield is 6.6% with a 100% payout ratio, indicating higher risk [11][14] - For contrarian income investors, Bristol Myers Squibb may be more attractive, but for those seeking a turnaround opportunity, Pfizer presents a better choice due to its 55% decline from 2021 highs compared to Bristol Myers Squibb's 35% decline from 2022 highs [12][15] Market Performance - Pfizer's stock is currently trading at $25.88 with a market cap of $147 billion, while Bristol Myers Squibb is at $52.73 with a market cap of $104 billion [10][13]