Pfizer Trades Above 50-Day Average for a Month: Time to Buy?
The 50-day SMA is a key indicator for traders and analysts, used to identify support and resistance levels. It is considered particularly important as it's the first marker of an uptrend or a downtrend.
The stock has consistently traded below its 50-day average since mid-March till the end of May as it faces several headwinds, including declining sales of its COVID-19 products, U.S. Medicare Part D changes and the looming threat of patent expirations on several key drugs.
However, despite the headwinds, its key drugs like Vyndaqel, Padcev, Eliquisand new and newly acquired products should continue to drive top-line growth. Its cost cuts and internal restructuring are saving costs.
Let's understand the company's strengths and weaknesses to better analyze how to play the stock as it consistently trades above the 50-day SMA mark.
Sales of PFE's COVID Products Declining
With the end of the pandemic, sales of Pfizer's COVID products, Comirnaty and Paxlovid, came down to around $11 billion in 2024 from $56.7 billion in 2022. In 2025, Pfizer's revenues from Paxlovid and Comirnaty are expected to be similar to 2024. COVID revenues may decline further in future years, depending on infection rates.
PFE's New Drugs & Seagen Acquisition Drive the Top Line
Though COVID revenues are declining, Pfizer's non-COVID operational revenues improved in 2024, driven by its key in-line products like Vyndaqel, Padcev and Eliquis, new launches and newly acquired products like Nurtec and those from Seagen (December 2023. The positive trend continued in the first quarter of 2025. Continued growth of Pfizer's diversified portfolio of drugs, particularly oncology, should support top-line growth in 2025.
Pfizer's new products/late-stage pipeline candidates and newly acquired products, including those acquired from Seagen, position it strongly for operational growth in 2025 and beyond. Pfizer expects the 2025 to 2030 revenue CAGR to be approximately 6%.
PFE Enjoys a Strong Position in Oncology
Pfizer is one of the largest and most successful drugmakers in oncology. The addition of Seagen strengthened its position in oncology.
Its oncology revenues are rising, driven by drugs like Xtandi, Lorbrena, the Braftovi-Mektovi combination and Padcev. Pfizer has ventured into the oncology biosimilars space and markets six biosimilars for cancer. Pfizer also advanced its oncology clinical pipeline with several candidates entering late-stage development, like sasanlimab, vepdegestrant and sigvotatug vedotin. By 2030, it expects to have eight or more blockbuster oncology medicines in its portfolio.
In May, Pfizer inked an exclusive licensing deal with China's 3SBio for the latter's dual PD-1 and VEGF inhibitor, which will strengthen its oncology pipeline.
Pfizer is also working on expanding the labels of approved products (oncology as well as non-oncology) like Padcev, Adcetris, Litfulo, Nurtec, Velsipity and Elrexfio, among others.
Other Headwinds in 2025
Though Pfizer expects a moderate negative impact on revenues from the loss of exclusivity in 2025, the impact is expected to be significant in the 2026-2030 period as several of its key products, including Eliquis, Vyndaqel, Ibrance, Xeljanz and Xtandi, will face patent expirations.
Pfizer expects an unfavorable impact of approximately $1 billion from the Medicare Part D redesign under the IRA. Higher-priced drugs, including Vyndaqel, Ibrance, Xtandi and Xeljanz, are expected to be most affected by the IRA.
In April, Pfizer said it is discontinuing the development of its GLP-1R agonist, danuglipron, which was developed as a weight loss pill. Pfizer took the decision after one of the participants in the dose-optimization studies developed a potentially drug-induced liver injury, which resolved after danuglipron was discontinued. Novo Nordisk NVO and Eli Lilly LLY currently dominate the obesity market with their GLP-1 injections.
PFE's Stock Price, Estimates & Valuation
Pfizer's stock has declined 1.1% so far this year against an increase of 0.8% for the industry.
PFE Stock Underperforms Industry
From a valuation standpoint, Pfizer appears attractive relative to the industry and is trading below its 5-year mean. Going by the price/earnings ratio, the company's shares currently trade at 8.23 forward earnings, lower than 15.05 for the industry and the stock's 5-year mean of 10.87. The stock is also much cheaper than other large drugmakers like AbbVie, Novo Nordisk, Lilly, AstraZeneca, J&J and others.
PFE Stock Valuation
The Zacks Consensus Estimate for earnings has remained unchanged at $3.06 per share for 2025 and $3.09 per share for 2026 over the past 30 days.
PFE Estimate Movement
Stay Invested in PFE Stock
Pfizer faces its share of challenges, including declining sales of its COVID-19 products, U.S. Medicare Part D headwinds, the upcoming loss of exclusivity (LOE) cliff in the 2026-2030 period, uncertainties around tariffs and a volatile macro environment. However, with COVID-related uncertainties diminishing, its revenue volatility is declining. Pfizer's key drugs like Vyndaqel, Padcev and Eliquis and new and newly acquired products should continue to drive top-line growth.
Pfizer expects cost cuts and internal restructuring to deliver savings of $7.7 billion by the end of 2027. Pfizer's significant cost reduction and efforts to improve R&D productivity measures should drive profit growth. Though Pfizer does not expect strong top-line growth over the next three years due to the LOEs, it expects EPS growth.
Pfizer's dividend yield stands at around 7%, which is impressive.
Investors should continue to retain this Zacks Rank #3 (Hold) stock in their portfolio as it appears to have significant upside potential. Its new drugs and a robust pipeline may help navigate the upcoming LOE period. It will be a great pick for value investors, considering its cheap valuation, and for income investors due to its sky-high dividend yield.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Pfizer Inc. (PFE): Free Stock Analysis Report
Novo Nordisk A/S (NVO): Free Stock Analysis Report
Eli Lilly and Company (LLY): Free Stock Analysis Report
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