Gloomy Pfizer 2024 Outlook

The reduced earnings numbers cap a difficult year for the drug giant. Its shares have fallen 45% and it has struggled to maintain the momentum it achieved during the pandemic with the development of one of two widely used Covid vaccines and a Covid treatment, Paxlovid.

Any bets on whether Pfizer CEO compensation will be cut? LOL

When Jamie Dimon had that $80M payday, JPM’s “shareholder return” trailed the industry average.

Steve

That dividend is starting to look really nice.

Andy

Sure does! (if it is maintained)

Pete

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Indeed. Divis aren’t the untouchable they used to be. Management will happily throw shareholders under the bus, while continuing to stuff their pockets full, regardless how poor their performance. Boeing stopped it’s divi several years ago, but the CEO still pulls down over $20m/year.

Steve

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I think Bourla’s last stock sale was at $45/share. This is the “kitchen sink” quarter where they release all the bad news, and then some.

Oddly my Zoetis shares (the Pfizer pet medicine company that was managed by Bourla and spun off in 2012) is now worth almost as much as my Pfizer shares. People spending lots of money on their pets, but not getting human vaccines.

intercst

I’m having a hard time imagining PFE will be a bad buy at current prices, but then I thought that many dollars ago. Seems like it is being valued only (or at least primarily) on the COVID vaccines and ignoring a lot of other stuff. Time will tell, but I’ll continue to add some shares when the price seems right and collect the dividend.

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I owned PFE a few years ago (late 1990s and a short stint in 2008) and made a small profit each time, but only held it for a relatively short time. But throughout last year, I made a few small purchases in an attempt to build a meaningful position in it again. Well, I chose the wrong pharma company to invest in. I bought on 3/8/23 at $40, on 5/12/23 at $37, and on 9/6/23 at $34. Current IRR is -43%. Luckily it is only very small numbers so it doesn’t matter much in the overall picture.

Now we have to decide, if we’re going to buy a pharma, is PFE the one to buy, will it outperform most of the others? I don’t know the answer to that question, so right now I’m not buying. I suspect they will begin to make some acquisitions in their hunt for new blockbusters, and that may depress the price some more.

Many suspect that the company "kitchen sink"ed it this quarter (see comment above), but we can’t be sure. Any more bad news plus a big acquisition could easily see the price drop to the high teens. I’m not saying it will happen, but I am saying that there is some probability of it happening. Of course, with the market going gangbusters due to all the rate cuts in 2024/25, it may be swept up in the general euphoria.

I also sometimes wonder if I have an unhealthy affinity towards PFE because a close relative retired from there a number of years ago.

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