Pfizer (PFE) stock is a new Buy at Guggenheim

A team of Guggenheim analysts led by Vamil Divan started research coverage on Pfizer (NYSE: PFE) with a Buy rating and a 12-month target price of $36, implying roughly 30% upside from Thursday’s closing price.

PFE rose 0.5% in premarket trading.

Over the past two years, Pfizer's stock has notably lagged behind expectations, a period marked by heightened investor anticipation for the company's COVID-19 vaccine, Comirnaty, and its oral antiviral treatment, Paxlovid, amid the pandemic.

“We believe expectations for Pfizer's COVID assets have now appropriately come down and, while several of their other largest revenue generators are also facing challenges, we see an opportunity for near-term estimates to increase,” said Guggenheim analysts.

This opportunity depends on whether Pfizer can “successfully commercialize large potential opportunities, such as Padcev in 1L bladder cancer and Abrysvo for prophylactic vaccination against RSV,” they added.

Currently, with investor expectations for PFE being quite low, any clinical success from notable pipeline assets like vepdegestrant, VLA15, and ponsegromab could boost investor confidence and enhance long-term forecasts, the broker commented.

“Beyond the products that have already launched, we believe Pfizer now has an interesting mix of internally-developed and externally-acquired assets that can drive potential upside in 2027+, if successfully developed,” Divan and his team wrote.

Meanwhile, the existing dividend yield of approximately 6% offers stock support as management progresses with its strategy.

By Vahid Karaahmetovic

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