What happened
According to data from S&P Global Market Intelligence, shares of Pfizer (NYSE:PFE) gained 7.7% in February. The move has added more than $11 billion to the pharma giant's market capitalization.
So what
Pfizer showered investors with a number of positive announcements during the month that helped to nudge its stock higher. Here's a review of the most important announcements from the period:
- Top-line results from a study comparing its rheumatoid arthritis drug Xeljanz to AbbVie's Humira showed that Xeljanz in combination with methotrexate met its primary endpoint in demonstrating non-inferiority versus Humira in combination with methotrexate.
- Pfizer and partner Celltrion Healthcare presented data at the annual Congress of the European Crohn's and Colitis Organisation. The data showed that Inflectra -- Pfizer's biosimilar version of Johnson & Johnson's megablockbuster drug Remicade -- showed similar efficacy and safety in treating Crohn's disease when compared to Remicade.
- Its FDA Biologics License Application, or BLA, for inotuzumab ozogamicin has been accepted for review. This drug has been granted Priority Review by the agency as a treatment for relapsed or refractory B-cell precursor acute lymphoblastic leukemia. A decision date is expected by August 2017.
- According to Pfizer and partner Merck, a second BLA has been accepted by the FDA for Priority Review of avelumab as a hopeful treatment for urothelial carcinoma. A decision is also expected in August of this year.
IMAGE SOURCE: GETTY IMAGES.
When you add this string of positive developments to the general rise in the healthcare sector -- as measured by the Vanguard Health Care ETF -- it is easy to understand why shares rallied in February.
Now what
Pfizer's management team is projecting that 2017 will be another year of growth. Revenue is expected to land between $52 billion and $54 billion while adjusted earnings per share is forecasted to fall in the range of $2.50 to $2.60. While the midpoint of this range represents a small bump from the $52.8 billion in revenue and $2.40 in adjusted profits recorded in 2016, it's growth nonetheless. It's also worth pointing out that this forecast reflects the upcoming disposition of its Hospira Infusion Systems business and a negative hit from currencies. Absent these charges, the growth rates would be quite a bit higher.
All in all, Pfizer continues to look well positioned to post modest EPS growth in the years ahead. With shares trading for less than 14 times full-year earnings estimates and offering up a dividend yield of 3.7%, Pfizer remains a solid choice for healthcare investors who eschew risk.
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