On the surface, Pfizer(NYSE: PFE) had some good news to report on Thursday. But investors viewed the positive as a negative, in light of its timing. This wasn't helped by an analyst's price-target cut on the stock.
At the end of the trading session, Pfizer's share price had declined by over 2%, versus the nearly 1% rise of the S&P 500 index.
The good news that few investors seemed impressed with had to do with Pfizer's COVID-19 drug Paxlovid. Thursday morning, the company announced that the treatment has been approved for use by adults with mild to moderate forms of the disease, and who are at high risk of progressing to severe forms.
Paxlovid has been on the market for some time; the Food and Drug Administration granted it Emergency Use Authorization (EUA) in December 2021. According to Pfizer, over 11.6 million treatment courses of the drug have been prescribed in this country.
While it is typically a positive development when a pharmaceutical or biotech company's medication wins full approval, there are two caveats here. First, with the EUA, Paxlovid had already been widely available, and second, we are no longer in the thick of the pandemic. It's likely that many investors, then, consider the Paxlovid approval to be a case of too little, too late.
Meanwhile, Berenberg analyst Kerry Holford reduced her price target on Pfizer stock before market open. She now thinks the shares are worth $35, down from the previous $40. She maintained her hold recommendation on the stock.
Despite these two developments, Pfizer remains worthy of consideration for anyone looking to own an anchor healthcare title. Its portfolio of commercialized products is wide and deep, as is its pipeline.
The company has also proved to be adept at finding strong partners. A notable success in this area is German biotech BioNTech, with which Pfizer co-developed the widely administered coronavirus vaccine Comirnaty.
10 stocks we like better than Pfizer
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Pfizer wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of May 22, 2023