Do I need to buy Pfizer in April?

13 months Pfizer (((NYSE: PFE). Announced that it is affiliated with BioNTech Develop COVID-19 vaccine. Since then, Pfizer’s share has risen by more than 26%. That may not seem so bad, given that the S & P 500 Index soared nearly 2.5 times over the same period.

But in some respects, the future of major pharmaceutical companies looks better than it has been for quite some time. Do I need to buy Pfizer in April?

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Pfizer’s Pooh?

Let’s start by trying to talk to you by considering buying this big one Pharmaceutical stocks.. If investors aren’t excited about launching the COVID-19 vaccine, which changes the game at record speed, there’s a pretty good case where nothing happens. That’s exactly what Pfizer did, but it’s relatively small in terms of stock performance to show it.

One of the main reasons is that no one knows how successful Pfizer’s COVID-19 vaccine will be after 2021. Even if booster shots are needed, the number of vaccinations can be significantly reduced after the pandemic is over. Also keep in mind that Pfizer needs to split the benefits of the COVID-19 vaccine at BioNTech.

On the other hand, Pfizer’s current lineup has some big question marks. The autoimmune disease treatment Xeljanx has failed in post-marketing safety studies. People taking this drug had a higher incidence of cardiovascular events and cancer than those taking TNF inhibitors such as Fumira and Enbrel.

The company initially wanted the breast cancer drug Ebrance to be a major winner as an early-stage adjuvant. But that doesn’t happen after two late-stage clinical trials failed last year.

The outlook for Pfizer’s pipeline is also cloudy. The US Food and Drug Administration (FDA) has postponed review of abrocitinib regulatory submissions for the treatment of atopic dermatitis by three months. And the FDA Advisory Board overwhelmingly voted against recommending tanezumab for the treatment of osteoarthritis pain.

Better photo

You may want to see a bigger (and better) big picture of the company before escaping from Pfizer like a plague.For one thing, Pfizer no longer has old drugs like Lipitor and Lyrica that have lost their monopoly rights with a focus on growth, thanks to the spin-off of the Upjohn unit and its integration with Mylan. Viatris..

Due to this delay in trading, Pfizer expects to bring a compound annual growth rate (CAGR) of 6% to earnings and a double-digit CAGR to adjusted earnings per share over the next five years. These numbers are risk adjusted. Pfizer does not expect all pipeline candidates to succeed in achieving this level of growth.

More importantly, the company’s growth forecast does not include potential sales from the COVID-19 vaccine. Not a penny. Together, Pfizer and BioNTech can easily earn over $ 20 billion from vaccines in 2021 alone.

Look for great chunks of that recurring revenue.Pfizer CFO Frank Damerio Recently confirmed Large pharmaceutical companies fully anticipate the need for annual vaccinations. The COVID-19 vaccine has proven to be safe and highly effective. Pfizer is a new version of the vaccine that does not require ultra-cold storage and needs to remain competitive.

Don’t dismiss the possibility of Pfizer’s pipeline either. The company is likely to win FDA and European approval for the new pneumococcal vaccine. Lorbrena received FDA approval in March as a first-line treatment for ALK-positive metastatic lung cancer. Pfizer’s clinical success rate is also hitting the biopharmacy industry. This is a precursor to Pfizer’s increasing approval from future pipelines.

2 out of 3 is not bad

So do I need to buy Pfizer in April? My answer is that it depends on your investment style.

In reality, Pfizer will probably not bring the level of long-term growth that aggressive investors demand. Even with the COVID-19 vaccine and potential pipeline winners, the company is unlikely to match a high-growth growth stock.

However, we haven’t talked about Pfizer valuations yet. Value investors may prefer Pfizer shares to trade at 11.5 times their expected returns.

If you’re a revenue investor, Pfizer is arguably attractive. The company’s dividend yield is currently 4.2%.Certainly, the yield will drop a little Pfizer’s pre-planned dividend cuts are coming When Viatris launched its dividend program this quarter. But even after that happens, Pfizer will continue to be one of the better dividend stocks on the market.

In conclusion, Pfizer looks like a good choice for bargain hunters and income seekers this month, but not for investors who want aggressive growth. As the old saying goes, two in three aren’t bad.