“Big Pharma” doesn’t come much bigger than Pfizer (PFE). Although you could argue it is so big, the stock can hardly move. Shares are essentially trading for the same price as 3 years ago.
Pfizer is also one of the leading names in the hunt for a COVID-19 vaccine. But unlike other names in the race to be first to market with a solution, the catalyst has had no bearing on the stock.
However, after attending the company's investor presentation, Mizuho analyst Vamil Divan believes the event “successfully illustrated how the company is evolving into a ‘New Pfizer.’"
Pfizer has an extensive pipeline of vaccines and treatments that it expects will generate over $15 billion of annual sales by 2025. The “New Pfizer” is also an attempt to highlight the giant’s growth potential. The upcoming spin-off of its Upjohn portfolio should rid it of unwanted bulk and help it become an “innovation-driven biopharma company.” The company expects to grow the top-line by 6% a year, while delivering double-digit growth on the bottom line.
On the rare diseases front, Pfizer anticipates six rare disease assets will be in Phase 3 trials by the end of the year, including three gene therapies.
The company is also developing a wide range of immunology products, “each for a targeted number of indications where there appears the potential for a truly differentiated product.”
Leading the charge form this business unit is abrocitinib, an oral JAK-inhibitor which Pfizer last month filed for the treatment of atopic dermatitis. Pfizer believes the treatment could reach annual sales above $3 billion.
Pfizer is also targeting the launch of 6 new vaccines by 2025. As for the company’s collaboration with BioNTech on a COVID-19 vaccine, Divan said, “we are encouraged by the data to date and believe Pfizer remains on track to have a clear sense of the vaccine's profile by the end of October, with potential FDA approval shortly thereafter.”
The analyst believes the vaccine can generate risk-adjusted sales of roughly $1.7 billion next year and $1.2 billion in 2022.
Overall, Divan rates PFE shares a Buy, along with a $43 price target. There’s room for upside of 17% from current levels should the target be achieved in the next months. (To watch Divan’s track record, click here)
The rest of the Street has roughly the same average price target ($43.13), whilst the analyst consensus currently rates the stock a Moderate Buy. The rating is based on 4 Buy and 6 Holds. (See Pfizer stock analysis on TipRanks)
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