Why Pfizer Stock Is Down By 6% Today

Pfizer Stock Drops After Q4 2021 Report

Shares of Pfizer gained downside momentum after the company released its fourth-quarter earnings report. The company reported revenue of $23.84 billion and adjusted earnings of $1.08 per share, missing the analyst estimates on revenue and beating them on earnings.

In 2022, Pfizer expects to report revenue of $98 billion – $102 billion and adjusted earnings of $6.35 – $6.55 per share. Revenue guidance for Comirnaty was raised to $32 billion, while the revenue guidance for Paxlovid was initiated at $22 billion.

It looks that market expected stronger guidance from Pfizer, so traders rushed out of the company’s stock. Shares of other vaccine makers have also found themselves under pressure today. Moderna and BioNTech are down by 7-8%, while Novavax stock is losing about 14% of its value during today’s trading session.

What’s Next For Pfizer Stock?

Analysts believed that Pfizer would report earnings of $6.73 per share in 2022, so the company’s guidance of $6.35 – $6.55 per share missed their estimates. Assuming that Pfizer is able to report earnings at the midpoint of its guidance, the stock is trading at less than 8 forward P/E.

While the stock may look extremely cheap, the key question is whether Pfizer will be able to report such earnings in 2023 and beyond when the world gets back to normal after the coronavirus pandemic.

Analysts are skeptical and expect that Pfizer’s earnings will be moving lower in the next several years. The same worries put pressure on shares of other vaccine makers.

Pfizer is a big and diversified company, so its shares are less volatile compared to other vaccine stocks. However, coronavirus-related revenue is very significant for Pfizer stock, so the trajectory of the pandemic will remain the main driver for the shares in the upcoming months.

Pfizer stock has already declined by roughly 20% from the highs that were reached back in December, but it is not clear whether speculative traders will rush to buy the dip. If the market views Omicron as the last major variant of coronavirus, all vaccine-related stocks, including Pfizer, will have more downside.

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