In 2019, Pfizer (NYSE:PFE) was just another pharmaceutical company. Then in 2020 into 2021, it achieved its moment of stardom with the development of its Covid-19 vaccine. It is no small feat to develop a vaccine in such a short period of time. In less than one year, the company had a vaccine to combat the SARS-CoV-2 virus. The vaccine was the first to be approved by the U.S. and it is expected to drive substantial growth in revenue and profit this year which will give a boost to PFE stock. Even if that scenario does not occur, there are other reasons to be bullish on Pfizer.
It is estimated that the vaccine will bring $15 billion in revenue this year. But there is more to Pfizer than its Covid vaccine. It has plenty of other products in the works in the coming years.
Let’s take a look at why PFE stock should be on your radar.
Pfizer is making the right moves in the industry
As per the Investor presentation, the company is already working on 24 cancer medicines and has more than 275 clinical trials underway across areas of inflammation, oncology, and rare diseases.
Additionally, Pfizer recently reached an agreement with Celcuity (NASDAQ:CELC) in a licensing deal for breast cancer treatment. As per the agreement, Celcuity will have exclusive rights to the potential breast cancer drug. Pfizer will receive $10 million upfront and up to $300 million in royalty on sales.
Further, the company completed the spinoff of the Upjohn business, allowing Pfizer to focus on its strengths in the pharmaceutical industry.
Pfizer plans to build out mRNA vaccine business by itself as it sees high potential in the coming year. The pandemic has changed the healthcare industry and Pfizer is making the right moves at the right time. It has a vision for the future which makes PFE stock a great buy right now.
PFE stock has strong potential
Despite the vaccine success, the company saw only a minor gain in revenue from $41.1 billion in 2019 to $41.9 billion in 2020. However, it is expected that the revenue will see a massive surge in 2021. The company expects to generate $61.4 billion in sales in 2021. It is aiming at earnings per share of $3.15. The company has a market cap of $215 billion, and considering its sales and revenue prospects, the stock is currently trading at a cheap rate.
With a bright future and a lot lined up for the coming year, at $38.62, PFE stock is trading at a discount. It is a great healthcare stock to add to your portfolio at a discount.
Some investors are always on the lookout for dividend stocks to generate passive income. Pfizer has that as well with a current yield of 4% and a five-year dividend growth rate of over 6%. The company paid $8.4 billion in dividends in 2020.
The Bottom line
PFE stock has strong potential to generate revenue and growth in the coming year. With the success of its Covid-19 vaccine, we will see an upsurge in revenue that will take the stock higher. The company has already signed a contract with the EU for the delivery of 1.8 million Covid-19 vaccines in 2022, and 2023.
Wall Street is also bullish on the stock. Out of 22 analysts via MarketWatch.com, six have a buy rating while 15 have a hold rating, with a target price of $40.62.
PFE stock will continue to grow post-pandemic. The company reports Q1 results on May 4th. The results should give a perspective to investors about the future of the stock.
On the date of publication, Vandita Jadeja did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.