Pfizer (PFE) stock plunged about 18% from its August 2021
peak, giving up a considerable chunk of the gains enjoyed during the early
summer.
With booster-shot season quickly approaching, the
$239-billion biopharmaceutical company behind the COVID-19 vaccine Comirnaty
may be in for a bounce-back as prudent investors rotate back into value names
with underestimated growth profiles.
With an attractive growth profile and a depressed valuation,
I remain bullish on shares of Pfizer.
Pfizer Looks More Exciting Than Moderna
With a mere 18x trailing earnings multiple, you wouldn’t
view Pfizer, a more than century-old company, as on the cutting edge of
innovation.
The incredible mRNA vaccine that helped the world curb
COVID-19 is an astonishing innovation for a company that still doesn’t seem to
get the hype it deserves.
While Moderna (MRNA) and its more potent Spikevax
coronavirus vaccine may be a pure-play on mRNA vaccines that aim to inoculate
against more than just COVID-19, its stock is wildly expensive, with way too
much optimism baked in.
Indeed, if a clinical trial doesn’t go well, Moderna stock
likely has more room to the downside. Although Pfizer’s COVID-19 vaccine and
boosters will not move the needle as high as it would for Moderna, one must not
discount Pfizer’s innovations, or assume the firm is no longer capable of
reinventing itself into a higher-growth company.
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