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Why Is Pfizer (PFE) Down 8.6% Since Last Earnings Report?

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It has been about a month since the last earnings report for Pfizer (PFE - Free Report) . Shares have lost about 8.6% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Pfizer due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Q4 Earnings Top, 2023 Sales to Decline

Pfizer’s fourth-quarter results were better than expected as it beat estimates for both earnings and sales.

Pfizer reported fourth-quarter 2022 adjusted earnings per share of $1.14, which significantly beat the Zacks Consensus Estimate of $1.03 per share as well as our estimate of $1.01 per share. Earnings rose 45% year over year.

Revenues came in at $24.3 billion, which slightly beat the Zacks Consensus Estimate of $24.20 billion. Sales rose 2% from the year-ago quarter on a reported basis, reflecting an operational increase of 13% and currency headwinds of 11%. More than half of Pfizer’s revenues comprised direct sales and alliance revenues from its partner, BioNTech for the COVID-19 vaccine, Comirnaty, and revenues from Pfizer’s oral antiviral pill for COVID, Paxlovid.

Excluding revenues from Comirnaty and Paxlovid, sales rose 5% operationally. Higher sales of key brands like Vyndaqel/Vyndamax, globally and Eliquis and Prevnar family in the United States were partially offset by weaker sales of Xeljanz and Ibrance globally.

International revenues rose 14% to $15.81 billion. U.S. revenues rose 10% to $8.48 billion.

Adjusted selling, informational and administrative (SI&A) expenses rose 17% (operationally) in the quarter to $4.41 billion due to increased spending for Paxlovid and Comirnaty and recently acquired and new products. Adjusted R&D expenses rose 7% to $3.61 billion due to costs related to oncology and non-COVID-19 vaccine programs and costs to develop recently acquired programs.

Segment Discussion

Beginning the third quarter of 2022, Pfizer has started reporting its revenues under three broad sub-segments of its Biopharma operating segment, Primary Care, Specialty Care and Oncology. Sales in the Primary Care segment rose 20% operationally to $17.35 billion. The Specialty Care unit recorded sales of $3.6 billion, down 3%. Sales of Oncology declined 3% to $3.0 billion.

Primary Care

In Primary Care, direct sales and alliance revenues from BioNTech for Comirnaty were $11.33 billion in the quarter, up 3% year over year. Comirnaty sales rose 15% in the United States. Comirnaty sales rose 1% outside U.S. markets as strong growth in developed markets like Europe and Japan following the slowdown in deliveries in the third quarter was offset by lower demand for Comirnaty in emerging markets. Comirnaty sales were significantly better than our estimate of $7.57 billion.

Paxlovid contributed $1.83 billion to sales in the fourth quarter, compared with $7.5 billion in the previous quarter. Paxlovid sales significantly missed our estimate of $4.959 billion for the drug.

Alliance revenues from Bristol-Myers (for Eliquis) and direct sales rose 5% to $1.48 billion. Continued oral anti-coagulant adoption and market share gains in non-valvular atrial fibrillation benefited alliance revenues for Eliquis sales in the United States. However, growth in the United States was offset by declines in certain emerging markets.

Global Prevnar family revenues rose 40% to $1.74 billion. The Prevnar family includes revenues from Prevnar 13/Prevenar 13 (pediatric and adult) and Prevnar 20 (adult). Prevnar revenues beat the Zacks Consensus Estimate of $1.57 billion.
Prevnar sales rose 79% in the United States due to strong demand for Prevnar 20 for the adult indication and favorable timing of government purchases for the pediatric indication. Prevnar revenues rose 10% in international markets.
Pfizer acquired Biohaven in 2022 that added Nurtec ODT/Vydura for migraine to its portfolio. Nurtec ODT/Vydura generated sales of $211 million in the fourth quarter.

Specialty Care

Rare disease drug, Vyndaqel/Vyndamax recorded sales of $680 million in the quarter, up 31% year over year, driven by continued strong uptake of the transthyretin amyloid cardiomyopathy indication in the United States and developed Europe, which was partially offset by a price decrease in Japan. Vyndaqel/Vyndamax sales were better than the Zacks Consensus Estimate of $633 million.

Xeljanz sales declined 28% to $493 million due to lower prices and prescription volumes as doctors’ prescribing patterns shifted away from JAK inhibitors following label warnings.

Enbrel revenues declined 8% to $236 million due to continued biosimilar competition in key European markets and Japan.

Pfizer acquired Global Blood Therapeutics in 2022, adding Oxbryta for hemolytic anemia due to sickle cell disease to its portfolio. Oxbryta generated sales of $73 million, in the fourth quarter.


In Oncology, Ibrance revenues declined 4% year over year to $1.28 billion due to planned price decreases in some international developed markets and a continued increase in the proportion of patients accessing Ibrance through the U.S. Patient Assistance Program. Sales missed the Zacks Consensus Estimate of $1.29 billion.

Xtandi recorded alliance revenues of $320 million in the quarter, up 5% year over year. Inlyta revenues were $243 million in the quarter, down 2%.

Full-Year 2022 Results

Full-year 2022 sales rose 23% to $100.3 billion, beating the Zacks Consensus Estimate of $100.24 billion. Sales were within the guided range of $99.5 to $102.0 billion. On an operational basis, sales rose 30% in the year. Excluding COVID-19 products, Paxlovid and Comirnaty, revenues grew 2% operationally.

Adjusted earnings for 2022 were $6.58 per share, 62% year over year. Earnings beat the Zacks Consensus Estimate of $6.47 per share as well as the guided range of $6.40 to $6.50.

2023 Guidance

Pfizer issued its financial guidance for 2023.

Revenues are expected in the range of $67.0 to $71.0 billion, indicating an operational decline of 29 from the 2022 level. Revenues were lower than the Zacks Consensus Estimate of $74.5 billion.

The revenue guidance includes approximately $13.5 billion in sales from Comirnaty, down 64% from the 2022 level and Paxlovid sales of approximately $8 billion, down 58%. Pfizer expects to launch both products in traditional commercial markets in the United States in the second half of 2023 as the company transitions away from the government market due to lower demand.

Pfizer’s 2023 revenues are expected to decline due to steep expected declines in revenues from its COVID-19 products on lower demand. Pfizer expects sales of its COVID products to reach the lowest point in 2023, before potentially rising again in 2024.

Pfizer expects about 102 million total vaccine doses administered in 2023 of which Pfizer is expected to maintain 64% market share. This means about 65 million doses of Comirnaty are expected to be administered in 2023.

Excluding COVID-19 products, Pfizer expects its revenues to rise 7% to 9% on an operational basis in 2023.
Albert Bourla, Pfizer’s chairman and chief executive officer, said that the company has the largest number of new product and indication launches planned for 2023.

The operational revenue growth in 2023 is expected to be driven by Pfizer’s in-line products, potential new launches like RSV vaccine for older adults as well as newly acquired products, including etrasimod for ulcerative colitis, Nurtec and zavegepant for migraine, and Oxbryta for sickle cell disease.

The expected decline in adjusted earnings is due to lower revenues from COVID products coupled with higher spending for near-term launches and late-stage pipeline candidates.

Adjusted earnings per share are expected to be in the range of $3.25 to $3.45, implying an operational decline of 48 from the 2022 level. The Zacks Consensus Estimate for earnings is pegged at $4.41 per share.

Adjusted cost of sales, as a percentage of sales, is expected in the range of 28 of total revenues. Research and development expense is expected in the range of $12.4-$13.4 billion. SI&A spending is expected in the range of $13.8-$14.8 billion. Both SI&A and R&D expenses are expected to be significantly higher in 2023 versus 2022 to support the launch of potential new products as well as recently acquired assets.

Acquired IPR&D expenses are expected to be approximately $0.1 billion. The adjusted tax rate is expected to be approximately 15.0% in 2023. Adjusted Other (Income)/Deductions are expected to be approximately $1.5 billion of income.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month.

The consensus estimate has shifted -13.52% due to these changes.

VGM Scores

Currently, Pfizer has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Pfizer has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.

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