NYSE:PFE
$17.93
(2/9 12:03PM)
+0.5%
| Open | $17.87 |
Mkt Cap | $144.0 Billion |
| High | $18 |
52Wk High | $20.36 |
| Low | $17.65 |
52Wk Low | $11.62 |
| Volume | 28.3 Million |
Avg Vol 10D | 66.2 Million |
PFE Stock Evaluation
As discussed in our Recommendation Summary, we have reiterated our Fairly Valued on PFE at this time. There has been a relatively large decline in price over the last week of 3.75%, but there has not been any additional guidance on earnings from PFE. We are specifically looking for more attractive valuations for PFE before we would consider any change to our recommendation. So, while a decrease in price of this magnitude is a step toward a more positive valuation, we have not reached our valuation thresholds yet.
Recommendation Summary
We are reaffirming our rating on PFE as of this week’s report. While we firmly believe that valuing companies based on fundamentals is very useful, we are careful not to view historical valuations in a vacuum. It is foolish to believe that a stock will always revert to historical norms. So, although there is value in historical norms, they only tell part of the story. When the market or a sector breaks through strategic thresholds such as standard deviations of historical pricing multiples, we find it necessary to view history with a grain of salt as a new reality may be dawning.
The market has risen in the last twelve months a bit more than what we consider normal growth. So, we are being a bit more cautious with our outlook going forward in general. However, with that being said, we see no compelling evidence to suggest a rating change this week. Take a look at our full analysis for more detailed information.
It is often helpful to begin our analysis with recent price changes, the price of PFE declined from $18.66 as of 01/30/2010 to a price of $17.96 as of 02/07/2010. While this decrease of 3.75% was not large enough for Ockham to upgrade the stock, it does however slightly increase the attractiveness of PFE, assuming that the fundamentals remain at current levels.
As of this report, there have been no meaningful adjustments in cash earnings expectations or guidance in the last week.
PFE Revenue
Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, PFE the high and low end of the Price to Sales per share ratios are 4.71x and 3.20x respectively.
Notice that PFE's current Price to Sales per share ratio is 2.90x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $17.96, PFE is 27% below where we would expect to see it. This will beneficially factor into our final analysis of PFE as it is not often that this stock sinks to these levels.
PFE Cash Earnings
Looking at PFE specifically in their Cash Earnings capabilities, Ockham views PFE as significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for PFE, the current level of Cash Earnings compared to its historical levels helps identify where PFE is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 17.21 and a historical low Cash Earnings per share ratio of 11.66, an investor can relate where value becomes optimal.
So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for PFE? From the Ockham perspective, we are looking specifically at PFE to see if the market is recognizing the huge disparity between PFE's past stock price to Cash Earnings ratio to today's levels. At a difference of 19% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at PFE. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.
PFE Dividends
When determining a company's future prospects for success, Ockham Research sees analysis of dividend payments as a key additional factor. Even though it isn't imperative for PFE to shell out a dividend in order to receive a positive rating, it can be helpful to further our analysis.
The estimated annual dividend for PFE is $0.72 producing a current dividend yield of 4.01%. Much like our evaluation of Sales and Cash Earnings per share, we review dividend yields from PFE against the historic high and low levels over all available dividend history. Because dividends are a decision made exclusively by management, we view a healthy and rising dividend as a sign of confidence and strength. The highest dividend yield from PFE over previous years was 8.96% while the lowest dividend yield was 0.94%. With that range in mind, PFE’s current dividend yield is a full 18.99% below its median dividend yield historically. This is a negative from our perspective.
Notice a Discussion Covering PFE Appeared Recently in the Financial News
The latest news from Fast Money on PFE is available through Ockham's news analytics platform RazorWire.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals.
“… Other side of the trade is that PFIZER who has the 60%. 60/40 split. This could be something for PFIZER as you are lookation head to lip tore and you know there is going to be ... …”
Notice a Discussion Covering PFE Appeared Recently in the Financial News
The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Pfizer, Incorporated.
Pfizer, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. We noticed recently that in comparison to all other stocks we analyze in the news; PFE has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… speaking of quickness, the split between you and PFIZER, tell that for the audience. > > 60% of our development costs going forward in the united states. 100% of our u. S. …”
Zero Hedge: Discussion of PFE's Earnings
Earnings are one of the most important fundamental factors we track, so we are always interested in the latest profit reports and news.
The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.
“… Pundits pointed to things like PFIZER earnings or to some of the data missing the estimates. But down on the playing field, it was clear that it was all about the buck and ... …”
Stocks to Watch: PFE Heavily Covered on Power Lunch
Something important is going on with PFE today, as it is getting a lot of attention on business television and influential blogs.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others.
“… Bank of america, ge, ford, PFIZER, all lower across the board in the sell-off. The dow off 200 points. With fidelity, you can take your trading around the world, because now ... …”
There is Significant News on PFE:Among the Twenty Most Active Stocks in the News
PFE has been one of the most active stocks in the news today, so investors in it will want to pay attention to what is happening.
As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, PFE has been less covered in the news compared to the rest of our universe of stocks. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on PFE. The Motley Fool CAPS data suggests that investors believe Pfizer, Incorporated will beat the market in the foreseeable future.
“… In the first nine months of last year merck sold nearly $250 million worth of it but it could soon have new competition because PFIZER is in the final stages of developing a new ... …”
The Latest on PFE's Net Income from Seeking Alpha Wall St Breakfast
PFE investors are surely interested in the latest news from Seeking Alpha Wall St Breakfast about their fundamentals like net income.
Pfizer, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. We noticed recently that in comparison to all other stocks we analyze in the news; PFE has received less coverage from the financial media in business television and blogs. Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey.
“… PFIZER counts on explosive China growth. PFIZER (PFE) expects its business in China, where it has a 2. 2% share of the highly-fragmented and rapidly-growing pharmaceuticals ... …”
Closing Bell: Discussion of PFE's Earnings
The name of the game in business is profit, and we always pay attention for PFE news as it relates to earnings.
The Motley Fool CAPS data suggests that investors believe Pfizer, Incorporated will beat the market in the foreseeable future. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, PFE has been less covered in the news compared to the rest of our universe of stocks. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on PFE.
“… The two big headline stocks today, PFIZER, they're buying wyeth, but the numbers aren't going to be strong enough to offset the lipitor losses. …”
Invested in PFE? Turn on the TV, It's All Over the News and Closing Bell
The newswires are burning up right now on Pfizer, Incorporated, so check our RazorWire or turn on your TV to see why it is so active in the news.
When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals.
“… Also, weighing on stock today, a weak outlook from drug maker PFIZER. And pressured the broader market. We're moments away from earnings coming out of cisco and visa as well. …”
The Amount of News Coverage on Pfizer, Incorporated Places It in the Top Five Most Active Stocks
If you own PFE, then you need to get to a TV now. It has been mentioned in the news very frequently in the last hour.
Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals.
“… The winner in the gold area, weeks r PFIZER on the industrial average. Robert gray was just talking about things like writer which is on the down sisisisisisi the dollar was up ... …”
Volatility Alert: PFE Blasting Across the Newswire on Closing Bell
Be aware that something important has occurred for PFE and investors interested in this stock should seek out information in any way possible.
The Ockham valuation currently has a Fairly Valued stance on PFE because it trades within the price range that we would expect given current market conditions and fundamentals. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Pfizer, Incorporated has actually sunk a bit in comparison to the others.
“… Health care stocks clearly a story, PFIZER the worst-performing stock in the dow jones industrial average. Its guidance was weaker than the street was looking for. …”