Healthcare Business

How Far Will Pfizer Stock Slump?

When Pfizer Inc. (NYSE: PFE) released its fourth-quarter earnings report before the opening bell Tuesday, the pharmaceutical giant said that it had $0.55 in earnings per share (EPS) and $12.7 billion in revenue. That compared with consensus estimates of $0.57 in EPS and $12.61 billion in revenue, as well as the $0.64 per share and $13.98 billion posted in the same period of last year.

In terms of the breakdown, Biopharma revenues totaled $10.5 billion, up 9% operationally, primarily driven by Eliquis, Vyndaqel/Vyndamax, Ibrance, Inlyta and Prevenar.

Upjohn revenues were down 32% on an operational basis to $2.2 billion. This move was primarily driven by the expected significant volume declines for Lyrica in the United States due to multisource generic competition that began in July 2019. Excluding the unfavorable impact of Lyrica in the United States and other recent product losses of exclusivity, fourth-quarter 2019 revenues for Upjohn declined 6% operationally.

Looking ahead to the 2020 fiscal full year, the company expects to see EPS in the range of $2.82 to $2.92 and revenue between $48.5 billion and $50.5 billion. The consensus estimates call for $2.90 in EPS and $49.52 billion in revenue for the full year.

Dr. Albert Bourla, Pfizer’s board chair and chief executive, commented:

2019 was a busy year, highlighted by solid financial performance, shareholder-friendly capital allocation, the strengthening of our pipeline as well as the formation of the Consumer Healthcare JV with GSK. We also announced a definitive agreement to combine Upjohn and Mylan to create a new global pharmaceutical company, Viatris, marking an important milestone in Pfizer’s evolution toward becoming a more focused, global leader in innovative medicines.

Short sellers seemed to be taking a wait and see approach to Pfizer in the most recently reported period, but it remains one of the most shorted Dow Jones industrials.

Shares of Pfizer were traded down over 3% on Tuesday, at $38.76 in a 52-week range of $33.97 to $44.56. The consensus price target is $42.33.