Pfizer’s Hold Rating Balances Vaccine Growth Potential with Competitive and Financial Challenges

Wells Fargo analyst Mohit Bansal maintained a Hold rating on Pfizer (PFE – Research Report) yesterday and set a price target of $28.00.

Mohit Bansal has given his Hold rating due to a combination of factors surrounding Pfizer’s business prospects and market positioning. The potential expansion of Pfizer’s Abrysvo vaccine to a younger demographic, specifically 18-59-year-olds at higher risk of RSV, presents an opportunity to increase peak sales by $400 million, reaching a total of $2.6 billion. This opportunity is underscored by the estimated 22 million patients in the U.S. within this age group compared to the larger older adult demographic. However, the competitive landscape, with GSK also seeking approval for a similar population, and the current lower vaccine coverage rates in the younger demographic, contribute to the cautious optimism reflected in the Hold rating.
Bansal’s report also takes into account the financial metrics and market performance of Pfizer, including its average daily value and net debt levels. With a current estimated return on invested capital (ROIC) of 9% and a three-year EPS compound annual growth rate (CAGR), these financial indicators help form the basis for the Hold recommendation. By considering these elements, Bansal provides a balanced view of Pfizer’s potential growth against the backdrop of its financial health and competitive pressures, leading to the conclusion that investors should maintain their positions without increasing or decreasing their exposure to Pfizer’s stock at this time.

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Pfizer (PFE) Company Description:

Pfizer Inc. develops, manufactures and sells healthcare products, including innovative medicines and vaccines. Its key focus areas include oncology, inflammation & immunology, rare disease, vaccines and internal medicine. The company was founded by Charles Pfizer Sr. and Charles Erhart in 1849 and is headquartered in New York, NY.