In times of global pandemic, pharmaceutical companies attract a higher level of attention due to a solid dividend payout rate.
One of the contributing factors is the expectations of when and what company will invent the vaccine against the coronavirus. It is also important to remember about the sale of the associated goods. Plus, it is a defense sector, like consumer goods and utility services with a business that is more resistant to cycles since people will never stop eating, drinking, paying utility bills, and taking medications.
In today’s review, we are going to discuss the Pfizer pharmaceutical company and whether it managed to spark a bigger interest against the backdrop of the recent global events.
1. Evolution of Pfizer
2. Fundamental analysis of Pfizer
3. Technical analysis of Pfizer
Pfizer is one of the giants in the pharmaceutical market with its Lipitor being the most popular medication. The sales of this drug that is used to lower high levels of cholesterol in blood achieved the mark of $125 billion over the course of 15 years.
The company was founded back in 1849 by Charles Pfizer and Charles Erhardt (Americans of German descent). Interestingly, the company started its operation with the anti-parasitic drug. Then citric acid was added, the facilities for laboratories and factories were expanded, and in 1910 Pfizer became an expert in fermentation technology.
But it was only the beginning. The contributing factors helped push the business idea forward. Despite being a horrible chapter in people’s lives, the war provided Pfizer with additional state orders for penicillin production. Following the 1950s, PFE became popular in other countries, including Canada, the United Kingdom, and Iran. In the 80s and 90s, as the new pharmaceutical products were developed and commercially manufactured, the company grew even more.
Will Pfizer become the company to invent the vaccine? Nobody knows. Everything is possible.
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Acquisitions are an excellent illustration of the company’s cash flow capacity. Pfizer demonstrates startling figures here. The company acquired Warner-Lambert along with the rights to Lipitor and Wyeth in 2009 for $68 billion despite the raging crisis. PFE was ready to drop as much as $160 billion on Allergan too but the deal did not happen. Subsequently, the company had to pay $400 million in expenses after withdrawing from the negotiations and abandoning the deal.
The biggest investors include:
The company’s capitalization totals $208 billion with 88 thousand employees. The most popular medications you may have heard about are:
The dividend payout rate is rather appetizing with 4.11% or $1.52 per share. Now, let’s check out whether the company is fairly valued.
From 2015 to 2019, the revenues went up from $48.85 to $51.75 billion. Net profit increased from $6-7 to $16 billion with EPS reaching the $3 mark.
Let's take a look at the latest quarterly reports and see what we’ve got here. In terms of revenues and gains, April exceeded expectations. The August report is expected to be around 70 cents per share. This means that both amidst the pandemic and without it, the company is capable of generating about $2.5 to $3 in earnings per share.
Even following an impressive rebound, PFE still remains undervalued.
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The reaction to the instrument demonstrated the achievement of level 28 where the PE ratio was already working its way towards 10. In addition to a delicious dividend payout rate, we have an excellent company, that too originating from the defense sector.
The price easily returned above 34.19. That being said, it approached the mark of February sales with an obvious depletion, and so the breakout of 38.41 did not happen. This is a key mark to use when keeping a close watch on the unfolding situation and forecasting further scenarios regarding this company’s shares.
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Аutor: Viktor Makeeu
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