Bernstein cuts Pfizer stock target to $30, keeps Market Perform

On Tuesday, Bernstein SocGen Group adjusted its stance on Pfizer Inc. (NYSE:PFE) shares, reducing the price target from $32.00 to $30.00 while maintaining a Market Perform rating. The pharmaceutical giant, currently valued at $152.56 billion, trades at a P/E ratio of 18.79. Courtney Breen, the firm’s analyst, explained the rationale behind the adjustment, citing various factors that contribute to Pfizer’s current valuation and future prospects. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculations.

Breen acknowledged Pfizer’s efforts to stabilize its COVID-related business, implement cost-cutting measures, and adapt to the Inflation Reduction Act (IRA). These steps are part of Pfizer’s strategy to establish four key research and development (R&D) engines. The analyst expressed approval of Pfizer’s commitment to enhancing R&D productivity and reducing expenses by prioritizing these engines.

Despite these strategic moves, Breen remains cautious and seeks more concrete evidence of their effectiveness. The analyst stated, "We are pleased to see Pfizer’s commitment to enhancing R&D productivity and reducing R&D expenses through prioritizing 4 key R&D engines. However, we wait to see real evidence over the course of 2025 in this strategy being realized & the outcomes of the decisions that are being made, before we can become more positive on the stock."

In the valuation approach, Bernstein SocGen Group has shifted its emphasis, increasing the weighting toward multiples valuation from 50% to 75%. This change reflects a more conservative outlook on the stock’s future earnings potential. Breen’s revised price target of $30.00 implies a forward price-to-earnings (PE) multiple of 10.0 times for the fiscal year 2026.

The new price target suggests a more measured expectation of Pfizer’s performance, as the company continues to navigate the post-pandemic landscape and seeks to deliver on its strategic initiatives. Pfizer’s stock will continue to be monitored by investors as the company progresses towards its R&D goals and adapts to the changing healthcare environment.

In other recent news, Summit Therapeutics (NASDAQ:SMMT) has entered into a clinical trial collaboration with Pfizer to evaluate the combination of Summit’s investigational antibody, ivonescimab, with Pfizer’s antibody drug conjugates for treating multiple solid tumor types. This partnership aims to explore the safety and anti-tumor activity of these combinations, with trials scheduled to begin mid-year. Meanwhile, Pfizer has decided to discontinue the global development of its gene therapy product, Beqvez, used for treating hemophilia. This decision follows the cessation of another similar treatment last December.

Additionally, Pfizer received FDA approval for a new regimen of ADCETRIS for certain types of relapsed or refractory large B-cell lymphoma, marking the eighth indication for the drug. The approval is based on a Phase 3 trial showing a 37% reduction in the risk of death for patients treated with the ADCETRIS regimen. Jefferies analyst Akash Tewari raised Pfizer’s stock price target to $34, maintaining a Buy rating, following positive data from a clinical trial involving Pfizer’s mevrometostat. The trial showed promising results in prostate cancer treatment, with a median progression-free survival of 14.3 months for the combination therapy.

In political developments affecting the healthcare sector, Robert F. Kennedy Jr. was confirmed as Secretary of Health and Human Services, a decision that has stirred controversy due to his past statements on vaccines. This confirmation has reportedly had a negative impact on vaccine stocks, including those of Pfizer. These recent developments highlight significant activities and strategic decisions by Pfizer that continue to shape its business landscape.

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