We started to talk about Pfizer (PFE) in this morning's Market Recon column here at Real Money and Real Money Pro. That was more about the FDA potentially authorizing Pfizer's COVID-19 vaccine for 12 to 15 year-olds rather soon, and Pfizer receiving the Biden administration's support in exporting the U.S. manufactured vaccine. That was prior to the firm's scheduled first quarter earnings release that has since occurred. With that report now in the books, let us take another look and see where the dust settled.
For Q1 2021, Pfizer reported adjusted EPS of $0.93 and GAAP EPS of $0.86, easily beating consensus by either measure. The adjusted number allows for earnings growth of 45% over the comparable period last year. Quarterly revenue generation landed at $14.6 billion, beating the street by nearly $1 billion and good for growth of 44.8%.
Moving on to the firm's various lines of business, Vaccines has grown from $1.611 billion for Q1 2020 to $4.894 billion for Q1 2021. That's more than 300% growth but the firm for obvious reasons does not consider this line item to be comparable. The firm's second largest business, formerly the largest, is Oncology where sales grew 18% to $2.862 billion. Internal Medicine increased 11% to $2.594 billion. Hospital grew 12% to $2.343 billion. Inflammation & Immunology experienced a 9% rise to $1.065 billion, while Rare Disease saw a 29% pop to $864 million. Clearly, the entire firm is seeing increased business on a broad level. Though developing and distributing the firm's messenger RNA vaccine BNT162b2, a collaborative effort with BioNtech (BNTX) , has obviously become the firm's most high profile effort, there is visible progress everywhere.
On patents, the firm did lose patent protection for its Chantix anti-smoking medication late last year and there had been concern for Pfizer's breast cancer drug Ibrance. During the quarter reported, in February, the firm was granted an extension by the U.S. Patent and Trade Office not to expire before March of 2027.
As for other well-known drugs marketed and sold by Pfizer.... Vyndaqel/Vyndamax (heart failure) saw sales growth of 88%, while Eliquis (blood clots) experienced 25% growth, and Xeljanz (arthritis, ulcerative colitis) sales popped 18%.
Pfizer expects to deliver 1.5 billion doses globally in 2021. The firm is boosting expected revenue produced by the BNT-162b2 COVID vaccine from $15 billion to $26 billion. This ups the firm's overall full year revenue guidance from $59.4 billion to $61.4 billion, all the way to $70.5 billion to $72.5 billion. Wall Street was around $61.5 billion on that number. The firm is also boosting guidance for adjusted EPS to $3.55 to $3.65 from $3.10 to $3.20. The street was pretty much in between $3.30 and $3.35 here. Revenue guidance ex-the COVID-19 vaccine reflects an increase of $200 million.
The stock showed some life early on this morning, and has now come in a bit.
On the plus side, PFE now wrestles with breaking out past a $39 pivot. This morning, there appears to be resistance, as Relative Strength currently stands in overbought space, and the daily MACD looks as indecisive as it gets up here. That said, you can wait if you are flat (or looking to add), but should this stock push on past pivot, you only have a dollar or so of room to make that purchase before the risk/reward proposition starts working again. Keep in mind that one of the best things about Pfizer for shareholders is that this name is not volatile... not that risky... and does pay shareholders a cool $1.56 (yielding 3.9%) just to be there.
Target Price: $48 (reiteration)
Pivot Point: $39
Panic: $36 (up from $35)