No doubt, Pfizer (PFE) is one of 2021’s out-and-out success stories. The pharma giant has posted year-to-date gains of a remarkable 72%, and the company – and investors – have Covid-19 to thank for the outsized returns.
Not only has Pfizer’s relationship with BioNTech resulted in the hugely successful Covid-19 vaccine, Comirnaty, but the company’s covid treatment pill, Paxlovid, showed exceptional results in clinical studies and Pfizer submitted its application for emergency approval to the FDA last month.
Last week, the company hosted an Investor/Analyst Day to discuss its covid program. Pfizer expects an EUA for Paxlovid for high-risk patients to be granted shortly without the need for an Advisory Committee Meeting prior to the regulatory body’s decision.
There was also an update from the ongoing Comirnaty trial in the pediatric setting. Pfizer said they believe the vaccine’s profile in children aged 6 months to 5 years “remains favorable” although compared to the 16-25 year old cohort, which showed “high efficacy,” a pre-specified immunogenicity analysis did not show non-inferiority for 2-5 year olds. The company is now running a three-dose study (up from two previously), which has delayed data and potential filing from December/early next year until 1H 2022.
With the capacity to manufacture around 4 billion doses of the vaccine next year, Mizuho analyst Vamil Divan sees the potential for sales estimates to “go up meaningfully in the coming weeks and months.”
In fact, due to some recent orders, Pfizer has increased its FY 2022 Comirnaty sales guidance from ~ $29 billion to ~$31 billion.
And as investors fully consider the Paxlovid opportunity, Divan sees room for “some further near-term upside.” That said, the analyst considers the shares “reasonably valued,” and believes that future triumphs are by no means guaranteed.
“The success Pfizer has had with Comirnaty and Paxlovid is now clear,” the analyst summed up, “But questions still remain on the longevity of the revenue streams, as well as how well Pfizer will be able to leverage that success into the rest of their business. We look to see if their “lightspeed” approach will lead to greater R&D productivity with the rest of their internal pipeline.”
Accordingly, Divan reiterated a Neutral (i.e. Hold) rating on PFE, along with a $56 price target, suggesting shares have 8% downside in the year ahead. (To watch Divan’s track record, click here)
The Street’s average price target is a similar $56.12. Overall, based on 7 Buys vs. 11 Holds, the analyst consensus rates the stock a Moderate Buy. (See Pfizer stock analysis on TipRanks)
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