HSBC has revised its price target for Pfizer (PFE, Financial), reducing it from $35 to $27 while maintaining a Buy rating. The adjustment comes as the biopharmaceutical giant faces potential challenges, including new U.S. tariffs and significant patent expirations. Additionally, pressures from the Part D and Inflation Reduction Act are expected to affect earnings.
The firm projects that if a 25% U.S. tariff is imposed, Pfizer's earnings in the innovative pharma segment could experience headwinds ranging from approximately 6% to 14%. Further analysis by HSBC suggests that additional risks could emerge from other factors like tax rates, dependent on how these tariffs are ultimately structured.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 19 analysts, the average target price for Pfizer Inc (PFE, Financial) is $28.71 with a high estimate of $41.43 and a low estimate of $22.00. The average target implies an upside of 25.25% from the current price of $22.92. More detailed estimate data can be found on the Pfizer Inc (PFE) Forecast page.
Based on the consensus recommendation from 23 brokerage firms, Pfizer Inc's (PFE, Financial) average brokerage recommendation is currently 2.6, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Pfizer Inc (PFE, Financial) in one year is $28.58, suggesting a upside of 24.69% from the current price of $22.92. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Pfizer Inc (PFE) Summary page.
PFE Key Business Developments
Release Date: February 04, 2025
- Full Year 2024 Revenue: $63.6 billion, up from $59.6 billion last year.
- Operational Revenue Growth (Excluding COVID Products): 12%, exceeding expectations of 9% to 11%.
- Full Year 2024 Adjusted Gross Margin: 74%.
- Full Year 2024 Diluted EPS: $1.41, up from $0.37 last year.
- Full Year 2024 Adjusted Diluted EPS: $3.11, up from $1.84 last year.
- Fourth Quarter 2024 Revenue: $17.8 billion, up from $14.6 billion in the same period last year.
- Fourth Quarter Non-COVID-19 Products Revenue: $13.7 billion, reflecting 11% operational year-over-year growth.
- Fourth Quarter Adjusted Gross Margin: Approximately 68%.
- Fourth Quarter Adjusted Operating Expenses: $7.3 billion, flat operationally.
- Fourth Quarter Adjusted SI&A Expenses: Decreased 4% operationally.
- Fourth Quarter Adjusted R&D Expenses: Increased 8% operationally.
- Fourth Quarter Adjusted Diluted EPS: $0.63.
- 2024 Capital Return to Shareholders: $9.5 billion via dividends.
- 2024 Internal R&D Investment: $10.8 billion.
- 2024 Deleveraging: $7.8 billion, including $2.3 billion in maturing debt and $5.5 billion in commercial paper.
- 2025 Revenue Guidance: $61 billion to $64 billion.
- 2025 Adjusted Diluted EPS Guidance: $2.80 to $3.00.
- 2025 Expected Net Savings from Cost Realignment: $4.5 billion by the end of 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Pfizer Inc (PFE, Financial) successfully integrated the Seagen business, enhancing its oncology capabilities.
- The company achieved strong financial performance with a 12% operational revenue growth excluding COVID products.
- Pfizer Inc (PFE) maintained a leadership position in key markets, such as the top spot in the 2024 IQVIA US Field Force Ranking report.
- The company demonstrated robust pipeline progress with more than a dozen approvals and several pivotal study starts.
- Pfizer Inc (PFE) achieved significant cost savings, contributing to expanded margins and strong shareholder returns.
Negative Points
- The COVID-19 portfolio showed stabilizing patterns with relatively low vaccination rates in the US.
- Pfizer Inc (PFE) faces competitive pressure in the adult vaccine market, particularly from Capvaxive.
- The company anticipates a $1 billion revenue headwind due to the IRA Medicare Part D redesign.
- There are concerns about potential impacts from new market entrants on the Vyndaqel franchise.
- Pfizer Inc (PFE) recorded approximately $2.9 billion in noncash intangible asset impairments related to several medicines.
