Pfizer vs. Allergan: Which Is the Better Breakup Buy?

PFE Chart

If forced to choose....

I think there's reason to be bullish on both companies from here, but if forced to choose my favorite buy right now I'd have to give the edge to Allergan. Its faster growth and discounted share price are simply too tempting to pass up.

After all, when the announcement of the merger first hit the wire it valued Allergan's shares at over $300 each. Shouldn't that make today's price of roughly $245 seem like a steal?

Or consider this: On November 20th, 2015, the last trading day prior to Pfizer announced its takeover offer, shares of Allergan closed at $312 while Pfizer closed just over $32. Pfizer's stock is basically flat since the deal was announced, while Allergan has been given a serious haircut.

That implies to me that there is simply more value in Allergan's shares today than there is in Pfizer's, hence why I think it's the better breakup buy.

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The article Pfizer vs. Allergan: Which Is the Better Breakup Buy? originally appeared on Fool.com.

Brian Feroldi has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson and Teva Pharmaceutical Industries. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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