Mitchell Martan
Investment Researcher for The Long Investor, Economics/Finance Background
Pfizer is cheap against its cash earnings at about 8 times, while drugmakers usually get 14 times. Fourteen times next year's cash earnings, give or take 12%, puts fair value at about $48.49-$61.71, so the $27.02 price sits 44% under the low end. This is a levels-only screen off reported earnings and revenue estimates, with no fundamental work. x.comÂ
Pfizer's CEO just bought $1 million of shares while the stock trades below its 200-week moving average, an insider purchase worth noting. The dividend yields 6.4%. x.comÂ
Pfizer has reached the point where all the negative news is priced in, and its 6-7% dividend pays holders while they wait. Earnings are done, though the stock has tested patience. x.comÂ
Pfizer looks to be forming a multi-year low and should be a major beneficiary of AI. It pays a 6.3% dividend at a forward P/E of 8, though one more low may come in the fall. x.comÂ
Pfizer looks set to rebound toward $30-$35 after about $2M of insider buying around $25. If Moderna can rally this year, so can this once-beloved pharma name. x.comÂ
Pfizer is the kind of stock that should heavily outperform when the AI bubble pops. A dip on news that its CFO is returning to the consumer sector leaves it below 9x earnings with a 6.7% dividend yield, a payout of only around 60% of earnings. x.comÂ
Merck looks cheap at 16x earnings when drugmakers usually get 20x. Fair value is roughly $168-214, or 20x next year's expected $9.57 EPS give or take 12%, putting the stock about 10% below the bottom of that range; it would be expensive above $215. The view leans on forecasts, with forward EPS 32% above trailing, and involves no fundamental work. x.comÂ
Merck looks overvalued at a forward P/E of 110. x.comÂ
Moderna remains unattractive despite forced Nasdaq-100 index buying: quarterly revenue is $145M against a $782M loss, while shares trade around $200. Citi rates it Sell with an $80 target. x.comÂ
Significant discounts to broader pharmaceutical industry valuations on projected 2031 earnings make some high-quality mid-cap biotech stocks attractive. Many have cleared Phase 3 trials or reached more advanced stages, and some may reach profitability without more capital, an advantage if financing tightens. Selling these stocks to chase speculative biotech or large pharma at historically elevated multiples makes little sense. x.comÂ