Opinions
Gordon Reid
Pfizer Inc
PFE-N
COMMENT
May 03, 2016
Stock price when the opinion was issued
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You'd have thought they'd be hit more by tariffs, as Trump hammers on that many drug components are made overseas. So the market must be thinking tariffs will benefit pharma, to explain why this name is up on such a tremendously down day. Keeping people guessing and on a knife's edge isn't a bug of the current US administration, it's a feature.
His healthcare investments focus on health management like UNH and medical devices.
Once upon a time, he really liked it. Beaten up for inability to bring forward a weight-loss drug; that may or may not be a realistic critique of this stock long term. Analyst community is really...just...waiting. He sold last year, not ready to come back in. Solid company, an improved oncology pipeline might be a reason to get back in.
Just reported and had quite good earnings. They are reeling, of course, from the government decision to not allow the Allergan deal to go through. There is a lot of debate because the 2 companies were within the law, but the tax inversion issue is a big one, and the way it was done is leaving a bad taste in people’s mouths. Pfizer is just starting to move out of the issue of Lipitor coming off patent. It was a blockbuster drug before, but when it goes generic you see sales drop dramatically. Their pipeline has been building. This company has had basically flat revenues and earnings for 4 or 5 years, and is trading at about 20X earnings. A bit of a “show me” stock, and that goes for most pharmaceuticals. You are better off going into biotechs. Prices have come down quite dramatically, and are trading at cheaper multiples than Pharma drug companies. Have a look at Biogen (BIIB-Q) or Celgene (CELG-Q).