Summary
PFE had a mild downside reaction to a minimal miss on Q3 sales.
But the stock remains in an uptrend, having increased its price:sales ratio from 4X to what looks to be 5X based on likely 2019 sales.
The incoming CEO is PFE's COO and says that PFE needs to up its game in R&D and marketing, slash bureaucracy; he counts on China to help drive growth.
Deflationary pressures in the industry and on PFE's growing biosimilar business are unrelenting and perhaps worsening.
I would only buy PFE at a lower P:S ratio.
Introduction
Hope springs eternal. Maybe Pfizer (PFE) is finally ready to catch up with the market (SPY) and vault past its Y2K era all-time high, as Microsoft (MSFT) and most of its Dow (DIA) compatriots have done. On Tuesday, PFE showed a mild sales disappointment in the Q3 earnings report and failed to participate in the SPY's strong snapback rally.
The earnings report showed 2% operational revenue growth, which in the conference call PFE noted was comprised of 4% unit growth and 2% deflation.
Diluted GAAP EPS were $0.69 versus $0.47 in Q3 2017.
Adjusted diluted EPS were $0.78 versus $0.67, up 16%, and is the "number" the Street generally runs with.
