Investors have been increasingly concerned over recession possibilities as the Fed raised interest rates to tame the high inflation. The economy is facing the worst-hit inflation in…
41 years, with the consumer price index rising 9.1% from a year ago in June.
Despite the bouts of market volatility, experts believe it’s important to stay invested and to focus on longer-term investing goals, in line with an age-old adage, “It’s all about time in the markets, not timing the markets.” In addition, according to FactSet, S&P 500 companies are expected to post high profits, with a 9.9% earnings increase in 2022, despite the growing recession fears.
Amid this backdrop, fundamentally sound stocks Pfizer Inc. (PFE), Broadcom Inc. (AVGO), and Comcast Corporation (CMCSA), which currently seem to be trading at a discount, could be solid additions to your watchlist.
Pfizer Inc. (PFE)
PFE, a research-based global company, engages in the discovery, development, manufacturing, marketing, sales, and distribution of biopharmaceutical products. The company’s global portfolio includes medicines and vaccines.
On June 30, PFE announced a new drug application submission to the U.S. FDA for the approval of PAXLOVID™ to treat patients at high risk for progression to severe illness from COVID-19. If approved, this should garner significant returns amid the rising covid cases.
In the same month, the company also announced an agreement to supply 105 million doses of vaccine to the U.S. government to support the continued fight against COVID-19 and cope with the next covid wave.
For the fiscal first quarter, PFE’s total revenues increased 76.8% year-over-year to $25.66 billion. Its adjusted net income grew 74.5% from the year-ago value to $9.34 billion, while its adjusted EPS stood at $1.62, reflecting a 70.5% increase year-over-year.
The consensus EPS estimate of $1.81 for the fiscal first quarter ended June 2022 represents a 69% improvement year-over-year. The consensus revenue estimate of $26.11 billion for the same quarter represents a 37.6% increase from the same period last year. It has an impressive earnings surprise history, as it topped Street EPS estimates in each of the trailing four quarters.
In terms of its forward Price/Sales, PFE is currently trading at 2.80x, 38.6% lower than the industry average of 4.55x. Its forward EV/EBIT multiple of 7.10 is 57.7% lower than the industry average of 16.78.
Over the past year, the stock has gained 29.1% to close yesterday’s trading session at $51.75. It gained 8% in the past month.
PFE’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, translating to Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
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