Here's How to Play Pfizer Stock Before Q4 Earnings Release

Pfizer PFE will report its fourth-quarter and full-year 2024 earnings on Feb. 4, before market open. The Zacks Consensus Estimate for sales and earnings for the fourth quarter is pegged at $17.50 billion and 48 cents per share, respectively. Estimates for Pfizer’s 2025 earnings have declined from $2.92 to $2.88 per share over the past 30 days.Find the latest EPS estimates and surprises on Zacks Earnings CalendarPFE Estimate MovementImage Source: Zacks Investment ResearchPFE’s Earnings Surprise HistoryThe healthcare bellwether’s performance has been solid, with the company exceeding earnings expectations in each of the trailing four quarters. It delivered a four-quarter earnings surprise of 74.50%, on average. In the last reported quarter, the company delivered an earnings surprise of 65.62%, as seen in the chart below.Image Source: Zacks Investment ResearchWhat Does Our Model Say?Pfizer has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Per our proven model, companies with the combination of a positive Earnings ESP and a Zacks Rank #1, #2 (Buy) or #3 have a good chance of delivering an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Factors Shaping PFE’s Upcoming ResultsThough sales of Pfizer’s COVID products, Comirnaty and Paxlovid, declined in the past few quarters, it seems their sales have stabilized somewhat. In the third quarter, revenues from COVID products improved due to increase in demand for Paxlovid due to a rise in infections. It remains to be seen if the positive trend continued in the fourth quarter.Pfizer records direct sales and alliance revenues from its partner, BioNTech BNTX, for the COVID-19 vaccine, Comirnaty, and product revenues from its oral antiviral pill for COVID, Paxlovid.Our estimate for direct sales and alliance revenues from Comirnaty is $3.13 billion, while that for Paxlovid is $540.6 million.The Zacks Consensus Estimate for direct sales and alliance revenues from Comirnaty is $3.27 billion, while that for Paxlovid is $589.0 million.Pfizer’s non-COVID operational revenues improved in the first three quarters of 2024, driven by its key in-line products like Vyndaqel and Eliquis, new launches like Abrysvo and newly acquired products like Nurtec as well as those acquired from Seagen (December 2023). The positive trend is expected to have continued in the fourth quarter.The Zacks Consensus Estimate as well as our model estimate for sales of Vyndaqel/Vyndamax is $1.52 billion.In addition, alliance revenues and direct sales from Eliquis are likely to have provided top-line support. The Zacks Consensus Estimate for alliance revenues from Eliquis is $1.66 billion, while our model estimate is $1.61 billion.Sales of key vaccine Prevnar declined in the third quarter. It remains to be seen if sales improved in the fourth quarter. The Zacks Consensus Estimate for sales of the Prevnar family of vaccines is $1.56 billion. Our model estimates Prevnar family vaccine sales to be $1.53 billion.In the Oncology unit, sales of key medicine Ibrance are likely to have been hurt due to lower demand trends globally due to competitive pressure and price decreases in some developed international markets. Sales of Xtandi, Lorbrena and Braftovi/Mektovi are likely to have increased. The antibody-drug conjugates or ADCs — Adcetris, Padcev, Tukysa and Tivdak – added to Pfizer’s portfolio with the Seagen acquisition in December 2023, boosted Pfizer’s oncology sales in the first three quarters of 2024, a trend expected to have continued in the fourth quarter. Pfizer is particularly witnessing strong demand for Padcev.In the Specialty Care unit, sales of Xeljanz and Enbrel are likely to have declined.We expect Pfizer’s several newly launched drugs like RSV vaccine Abrysvo, Velsipity pill for ulcerative colitis, pentavalent meningococcal vaccine Penbraya and new gene therapies for hemophilia, Hympavzi (marstacimab) and Beqvez/Durveqtix to have contributed to top-line growth.Pfizer issued an encouraging financial guidance for 2025 in December. Investors will look for an update on the same.Nonetheless, a single quarter’s results are not so important for long-term investors. Let us delve deeper to understand whether to buy, sell or hold Pfizer stock.PFE’s Price Performance & ValuationIn the past six months, Pfizer’s stock has declined 12.6% compared with a decrease of 13.0% for the industry.Pfizer Stock PerformanceImage Source: Zacks Investment ResearchFrom a valuation standpoint, Pfizer appears attractive relative to the industry and is trading below its 5-year mean. Going by the price/earnings ratio, the shares currently trade at 9.28 forward earnings, lower than 16.0 for the industry and the stock’s 5-year mean of 11.22. The stock is also much cheaper than that of several other large drugmakers like Eli Lilly LLY, Novo Nordisk NVO, AstraZeneca, AbbVie and others.PFE Stock ValuationImage Source: Zacks Investment ResearchOur Investment Thesis on PFE StockAfter a couple of tough years, it seems that Pfizer’s worst slowdown is over now and the company is gradually making a comeback.Pfizer faces its share of challenges, the key being declining sales of its COVID-19 products. Pfizer also expects a significant impact from the loss of patent exclusivity in the 2026-2030 period, as several of its key products will face patent expirations. However, its non-COVID drugs and potential contribution from new and newly acquired products have started to drive growth, with the trend expected to continue.Pfizer’s new products/late-stage pipeline candidates and newly acquired products, including those acquired from Seagen, position it strongly for operational growth in 2025 and beyond. Pfizer expects 2025 to 2030 revenue CAGR to be approximately 6%.The company continues to pay regular dividends. Its dividend yield stands at more than 6%, which is quite impressive. Also, Pfizer expects cost cuts and internal restructuring to deliver savings of at least $5.5 billion. Huge profits from its COVID products strengthened its cash position. The funds are being used to make acquisitions, increase dividends, buy back shares and reduce debt.Stay Invested in PFE StockNo matter how the fourth-quarter results play out, we suggest that those who already own the stock stay invested to see how Pfizer’s new growth drivers perform. Investors with a long-term horizon may consider buying this stock at the present attractive valuation.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Pfizer Inc. (PFE): Free Stock Analysis Report Novo Nordisk A/S (NVO): Free Stock Analysis Report Eli Lilly and Company (LLY): Free Stock Analysis Report BioNTech SE Sponsored ADR (BNTX): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks