MKM Partners Downgrades Pfizer (PFE) to Neutral, Cites Weak Pipeline

November 27, 2012 10:33 AM EST Send to a Friend
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Price: $29.11 +1.78%

Rating Summary:
    14 Buy, 7 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 24 | Down: 28 | New: 14
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MKM Partners downgraded Pfizer (NYSE: PFE) from Buy to Neutral with a price target of $25.00 (from $29.00).

The firm comments, "We are rolling out 2017 estimates for Pfizer and altering our forward looking valuation metrics to place more emphasis on pipelines for the U.S. pharmaceutical companies. This exercise leads us to decrease our fair value estimate for Pfizer from $29 to $25 and we are downgrading Pfizer shares to Neutral from Buy. After six new drug approvals in 2012, we expect Pfizer to only launch three new products between 2013 and 2017; the lowest number and least relative revenue contribution out of its U.S. peers. Based on Pfizer’s limited pipeline, we expect the company to have significantly lighter-than-average new product news flow over the next several years. On the positive side, with the loss of Lipitor now behind the company, Pfizer has significantly below average patent exposure (8.2% of current sales) through 2017. The net of these rankings implies that Pfizer is close to fairly valued on a forward looking basis, which leads us to downgrade the company to a Neutral rating."

For an analyst ratings summary and ratings history on Pfizer click here. For more ratings news on Pfizer click here.

Shares of Pfizer closed at $24.49 yesterday.


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