Pfizer Delivers Blowout Quarter, Raises Guidance

Blue-chip pharmaceutical company Pfizer, Inc. (PFE) delivered a blowout second quarter driven by robust COVID-19 vaccine sales. Shares jumped 3.2% on the news, closing at $43.45 on July 28. (See Pfizer stock charts on TipRanks)

The company reported adjusted earnings of $1.07 per share, up 73% year-over-year, and beat the Street’s estimate of $0.96 per share.

Revenue climbed 92% to $18.98 billion, surpassing analysts’ estimates of $18.45 billion. Direct sales and alliance revenue from the BNT162b2 (COVID-19 vaccines) business generated $7.8 billion in revenue.

Dr. Albert Bourla, Chairman and CEO, said, “The speed and efficiency of our efforts with BioNTech to help vaccinate the world against COVID-19 have been unprecedented, with now more than a billion doses of BNT162b2 having been delivered globally.”

Pfizer raised its full-year 2021 guidance based on higher expected revenues from additional supply agreements signed between mid-April and mid-July for COVID-19 vaccines, as well as enhanced revenue expected from its other businesses.

For the full year 2021, the company projects revenue and adjusted earnings to be in the range of $78 – $80 billion and $3.95 – $4.05 per share.

Street estimates for revenue and earnings are pegged at $72.78 billion and $3.70 per share, respectively.

The company believes that a booster dose of the vaccine is necessary to protect against the delta variant as the efficacy of the first two vaccine shots starts declining after six months. Hence, the company expects to apply for Emergency Use Authorization for the booster in the next month.

Pfizer and BioNTech expect to manufacture up to 3 billion doses of the COVID-19 vaccine by the end of December 2021, of which 2.1 billion doses are already considered in the full-year guidance. The accelerated guidance of full-year 2021 includes projections of $33.5 billion of revenue generation from COVID-19 vaccine sales.

Following the results, Mizuho Securities analyst Vamil Divan reiterated a Hold rating on the stock with a price target of $42, implying 2.5% downside potential to current levels.

Divan said, “Most of Pfizer’s key products besides the COVID-19 vaccine met or beat expectations, aside from Xeljanz, which remains under scrutiny given ongoing safety concerns. While the vaccine continues to dominate discussions on Pfizer, we look to the call and company commentary to better understand the vaccine’s longer-term impact and other steps Pfizer is taking to improve its longer-term outlook.”

Overall, the stock has a Hold consensus rating based on 2 Buys, 9 Holds, and 1 Sell. The average Pfizer price target of $43.40 implies that shares are almost fully priced at current levels. Shares have gained 16.8% over the past year.