Stanphyl Capital
Managing Member & Portfolio Manager at Stanphyl Capital, Value Investor
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'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 is a true safe haven that looks cheap at $28 a share, trading below 10 times adjusted earnings. Its 6.1% dividend has been paid for more than 349 quarters in a row, a remarkable record, and sentiment across biotech is strong after news from Moderna and Merck. x.comÂ
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
Micron's 5x earnings multiple reflects an AI bubble that will eventually implode, though not today or next week. Many are already saying AI tokens are not delivering the desired return on investment, and what works for some will not work for all. x.com 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
Consumer staples should strongly outperform in 2026, one of the year's expected surprises, if the AI bubble bursts. In that scenario circular financing deals unwind, AI capex slows abruptly on return-on-investment worries and power bottlenecks, and depreciation and weaker demand wreck AI earnings estimates. PepsiCo, Coca-Cola, Procter & Gamble and Kimberly-Clark would then materially outperform the Magnificent 7, with PepsiCo beating most staples on better organic unit growth. x.comÂ
S&P 500 earnings look flattered by AI spending: hundreds of billions in AI capex become immediate revenue for sellers of chips, servers and cloud capacity, while buyers amortize the cost over years. Revenue explodes now and the pain shows up later, so Wall Street raises estimates and stocks get even more expensive. That looks worryingly like a dot-com 2.0, and the risk is what happens when AI spending slows or stops. x.comÂ
NVIDIA looks close to the top of an AI bubble, with a two-year megaphone pattern signaling exhaustion of growth. Such expanding, volatile patterns historically don't end painlessly. Its roughly 22x valuation on a $4.8 trillion market cap and $216 billion profit is approaching Cisco's roughly 30x in 2000. Nvidia just raised $25 billion in debt, drawing $85 billion of orders. x.com x.comÂ