The coronavirus pandemic has shaped various aspects of our lives over the past two years. We have also learned new vocabularies like "epidemic", "covid-19", "social distancing", "flatten the curve", and "doomscrolling". Along with the increase in vocabulary is our knowledge of the pharmaceutical companies engaged in virus research like Johnson & Johnson (NYSE: JNJ), Moderna (NASDAQ: MRNA), and Pfizer (NYSE: PFE). Pfizer has proved to stand its ground against its peers in the fight against Covid-19.
A year after the discovery of the Covid-19 virus, Pfizer was the first company to have its vaccine approved by the Food and Drug Administration (FDA). That approval gave a boost to Pfizer stock. PFE rose by 15% after the approval and has continued to grow. But the success of its covid-19 vaccine is not only the primer for PFE's growth in recent times.
Overall sales from Pfizer rose by about 2% compared to last year, excluding the Covid-19 vaccine. Ibrance, a drug for treating breast cancer, had $5.39 billion in sales, representing a 9% growth. Eliquis, a blood thinner, had a sales growth of 17% at $4,95 billion. Xeljanz, a drug for treating arthritis and other inflammatory conditions, rose by 9% to generate revenue of $2.44 billion. Also, Vyndaqel and Vyndamax, used for conditions that can result in heart failure, gave the company $1.29 billion. But in retrospect, sales from Prevnar 13, used for treating infections, were flat at $5.85 billion.
But an enormous amount of growth for the past year has been seen on the vaccine front. Pfizer partners with a research institution, BioNTech, to produce its vaccines and booster shots. Revenue from vaccines and booster shots has generated more than $26 billion for Pfizer, and the sales are still coming. Pfizer and BioNTech are working on a vaccine that would be effective against the Omicron variant of the Covid-19 virus, and the market jumped on the report of successful trials. Several countries have approved the booster shots for Pfizer vaccines. Also, the company has developed a new pill, Paxlovid, that is 90% effective in preventing hospitalizations and deaths in patients at high risk of covid-19. That news saw the company's stock jump 18%.
The markets has reacted positively to the news coming from Pfizer and its astonishing sales records. A year ago, Pfizer stock was $33.36, but it is $61.02 today, which is more than a 90% increase in stock price. As a result, most analysts and investors believe PFE is a hold for the long term. Based on historical results, the 12-month forecast foresees PFE going up to $76 in a year, although a 9.21% decrease in prices could happen.
Compared to its peers like Johnson and Johnson, and Merck, who are also vaccine manufacturers, Pfizer is a better bet and gives higher expected returns. For example, while the 3-year expected return of Johnson and Johnson stock is 8%, Pfizer is expected to give a return of 17%. Over the past month, Merck saw a -10% return, Johnson and Johnson, a 5% growth, while Pfizer's stock was up 14%. Overall, Pfizer has outpaced by far the S&P500 Index, which has a teeny 1% rise over the past month.
The markets believe that the spike in Pfizer's stock is due to its success in combating covid-19 because the sales of other drugs are not encouraging and do not foresee further growth in the Pfizer stock if the pandemic abates. But for now, the stock is a hold.
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