On Tuesday, JPMorgan (NYSE:JPM) reaffirmed its Neutral rating on Pfizer stock (NYSE:PFE) with an unchanged price target of $30.00. The evaluation followed Pfizer’s first-quarter earnings report, which revealed sales figures falling short of projections, attributed to misjudgments regarding the Part D Redesign impact. However, earnings per share (EPS) exceeded expectations due to more effective expense management. Currently trading at $23.79, InvestingPro analysis suggests Pfizer is undervalued, with a P/E ratio of 16.92 and an attractive dividend yield of 7.46%.
Pfizer’s financial performance this quarter was a mix of underwhelming sales but surprisingly high EPS, a result of one-time benefits and timing. Despite generating substantial revenue of $63.63 billion in the last twelve months, JPMorgan analysts believe Pfizer’s guidance for the year appears highly achievable, if not conservative. This outlook takes into account potential headwinds from COVID-related sales. InvestingPro data shows the company maintains a GOOD financial health score, suggesting strong fundamentals despite market challenges.
In conjunction with the quarterly results, Pfizer announced a new $1.2 billion cost restructuring program. JPMorgan has left its top-line estimates for Pfizer largely intact but has raised its EPS projections for 2025 and beyond. Analysts at JPMorgan noted that Pfizer’s stock is currently trading at approximately 8 times its estimated 2025 EPS, which they consider inexpensive. However, they also pointed out that the company is facing modest top-line erosion over the next five years, with no significant decline in EPS expected.
The report also touched on Pfizer’s pipeline, particularly highlighting the oncology sector as an area with potential to make the company’s stock more appealing. However, JPMorgan stated that significant advancements or progress in these programs would be required to alter the current market perception of Pfizer’s shares. Such changes are anticipated to occur from 2026 onward.
In other recent news, Pfizer Inc. reported its first-quarter 2025 financial results, surpassing earnings expectations with an adjusted diluted earnings per share (EPS) of $0.92, significantly above the forecasted $0.68. However, the company’s revenue fell slightly short of projections, reaching $13.7 billion compared to the anticipated $14.09 billion. Despite this revenue miss, Pfizer returned $2.4 billion to shareholders through dividends. The company remains focused on key growth areas such as oncology and vaccines. Additionally, Pfizer has projected its full-year 2025 revenues to be between $61 billion and $64 billion, with adjusted diluted EPS ranging from $2.80 to $3.00. Analyst discussions during the earnings call highlighted strategic investments in research and development as part of Pfizer’s long-term growth strategy. The company also emphasized its ongoing efforts in manufacturing optimization and cost management to enhance shareholder value.
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