# Pfizer (PFE)

Sector: Pharmaceuticals

| Field | Value |
|---|---|
| Price | $29.58 |
| Fair value (Analysts) | $32.00 |
| Discount to fair value | 7.6% |
| Fair value uncertainty (Analysts) | Medium |
| Economic moat (Analysts) | Narrow |
| LSEG analyst rating (1 strong buy to 5 strong sell) | 2.67 |
| Data as of | 2026-10-16 |
| Next earnings | 2026-11-03 (confirmed) |

## In short

The market fears that patent losses and lower US drug prices will shrink Pfizer's revenue, and only steady growth of new medicines and good obesity data over several years can close the gap.

## Themes and gap

- Themes: Regulation and courts (regulation-legal), Weight-loss drugs (weight-loss-drugs)
- Gap type: Slow (slow)
- Why: Pfizer must replace the revenue of medicines that lose patent protection with new medicines and its obesity program, and that takes several years of launches and Phase 3 data.

## About

Pfizer is one of the largest drug companies in the world, based in New York. It sells medicines and vaccines in many areas: cancer (Padcev, Lorbrena, Ibrance and Xtandi), heart disease (Eliquis and the Vyndaqel family), vaccines (Prevnar, Abrysvo and Comirnaty) and others. In November 2025, Pfizer bought Metsera, a company that develops obesity medicines, for $65.60 per share in cash plus a contingent value right of up to $20.65 per share. Pfizer expects 2026 revenue of $60.5 billion to $62.5 billion.

## Thesis

The market prices Pfizer for a large loss of revenue as patents on major medicines expire in the next few years, and for lower drug prices in the United States. Revenue from COVID-19 products also continues to fall: Pfizer now expects about $4 billion in 2026, down from about $5 billion in its earlier guidance. In Q2 2026, Pfizer recorded $4.3 billion of impairments on intangible assets, which shows that some past purchases earn less than planned. To replace the lost revenue, Pfizer depends on its newer medicines and its pipeline. Its launched and acquired products grew 18% in Q2 2026, and it plans 10 Phase 3 studies of its monthly obesity medicine berobenatide in 2026. For the gap to close, three things must be true. Pfizer must keep 2026 adjusted EPS within its $2.80 to $3.00 guidance. Its guidance for 2027, which it may give in December 2026 as it did for 2026, must show that cost savings and new medicines can offset the patent losses. The obesity program must produce positive Phase 3 data on schedule. Pfizer reports Q3 2026 results on November 3, 2026, which is the next test. If these checks pass, the gap can close over several years, as the new medicines grow. The main reason it may not close is a faster revenue decline after the patent losses than the new medicines can replace.

## Checkpoints

- Nov 3, 2026: Q3 2026 earnings: guidance and new products. Status: Pending. Watch: Adjusted EPS on track for the $2.80 to $3.00 guidance with continued growth of launched and acquired products passes; a guidance cut fails.
- Q4 2026 (estimate): FDA decision on Talzenna with Xtandi in prostate cancer. Status: Pending. Watch: FDA approval for HRR gene-altered metastatic castration-sensitive prostate cancer passes; a rejection or a delay fails.
- Dec 2026 (estimate): 2027 guidance. Status: Pending. Watch: 2027 guidance that shows stable adjusted EPS despite the patent losses passes; guidance for a large drop in EPS fails.

## Balance sheet

- Cash: $11.7B
- Debt: $63.2B
- Net debt: $51.5B
- Undrawn credit line: $7.0B, to October 2030
- Debt due within 12 months: $2.7B

Pfizer is reducing the debt that it took on for large purchases. At June 28, 2026, total debt was $63.19 billion: long-term debt of $60.50 billion and short-term borrowings, including the current part of long-term debt, of $2.70 billion. Cash and short-term investments were $11.70 billion: $976 million of cash and $10.72 billion of short-term investments. Pfizer has a $7.0 billion committed revolving credit facility that matures in October 2030 and supports its commercial paper. Net interest expense was $1.11 billion in the first half of 2026. Pfizer paid $4.9 billion of dividends in the first half of 2026 ($0.86 per share) and bought back no shares. Its 2026 guidance assumes no share repurchases, and it plans to reduce debt over the longer term.

As of 2026-06-28.

Sources:

- https://www.sec.gov/Archives/edgar/data/78003/000007800326000094/pfe-6282026xex99.htm
- https://www.sec.gov/Archives/edgar/data/78003/000007800326000095/pfe-20260628.htm

## Recent events

- 2026-10-06: Pfizer declared a fourth-quarter 2026 dividend of $0.43 per share, payable on December 7, 2026.
- 2026-09-22: Pfizer said that it will report Q3 2026 results on November 3, 2026.
- 2026-08-04: Pfizer reported Q2 2026 results. Revenue was $15.0 billion, up 3% (1% at constant exchange rates). It had a reported loss of $0.04 per share because of $4.3 billion of impairments, and adjusted EPS was $0.77. Pfizer raised its 2026 revenue guidance to $60.5 billion to $62.5 billion and kept its adjusted EPS guidance of $2.80 to $3.00. It also announced $2.5 billion of additional cost savings, expected from 2027 through 2029.
- 2026-07-10: Pfizer completed its licensing agreement with Innovent Biologics for 12 early-stage cancer medicines. Innovent received $650 million upfront and can receive up to $9.85 billion more in milestone payments. Pfizer records the upfront payment as a charge in Q3 2026, which lowers 2026 adjusted EPS by about $0.10.
- 2026-06-18: Pfizer said that CFO Dave Denton will leave on August 15, 2026. Cecile Guegan became Interim CFO on August 16 while Pfizer searches for a new CFO. In June 2026, Pfizer also presented Phase 2b results for berobenatide, a monthly obesity medicine, and its Phase 3 lung cancer study of sigvotatug vedotin did not meet its main goal.

## Risks

- High: Several large medicines lose patent protection in the next few years. Generic and biosimilar competition already lowers 2026 revenue by about $1.1 billion, and the loss grows as larger products lose protection.
- High: The US government wants lower drug prices, including prices linked to other countries. New price rules or negotiated prices can lower the revenue of Pfizer's main medicines.
- Medium: The pipeline must replace the lost revenue. The obesity market has strong competitors, and a failed trial, such as the Phase 3 sigvotatug vedotin study in June 2026, removes expected revenue.
- Medium: Pfizer recorded $4.3 billion of impairments in Q2 2026. More impairments are possible if acquired medicines sell less than planned, and high debt limits share buybacks.

## Links

- Page: https://picks.kamadorueda.com/company/PFE/
- History of changes: https://picks.kamadorueda.com/company/PFE/history/
- JSON with full history: https://picks.kamadorueda.com/data/company/PFE.json

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