Will Pfizer Answer These Two Questions In Its First Quarter Earnings?

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Pfizer will report its Q1 2016 earnings on May 3rd, 2016. What can we expect? Here is what we believe are the key questions to which investors will seek answers.

Can Pfizer Revive Its Growth After Years Of Decline? 

  • Pfizer’s revenues have declined ~ 28% in 5 years
  • Reasons-> Lipitor patent loss, generic competition for legacy products, and the divestment of nutritional business, capsugel, animal health and other businesses.
  • We forecast ~ 5%-6% growth in 2016
  • Easing currency impact, >25% growth in cancer drugs, >10% growth in Prevnar vaccine, a slowdown in the Lipitor decline, Viagra’s material resistance to generic competition, and Eliquis’ ramp up will help.
  • Q1 2016 results could be indicative of the above trends.

After Allergan Merger Failure, What’s Pfizer’s Next Move? 

  • Pfizer and Allergan recently called off the proposed merger, following government’s move to make tax inversion strategy less rewarding
  • Pfizer has history of growing through big acquisitions, hence the  failed AstraZeneca bid in 2015 and now the failed Allergan merger attempt in 2016.  This could unsettle investors.
  • Pfizer will be under pressure to clear air on ‘what comes next’.
  • Potential moves could include a high number of smaller collaborations, as well as the potential splitting of legacy and growth businesses.
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Do you believe there are other major pressing issues that Pfizer must address? Do let us know through the comment section below.

Have more questions about Pfizer? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Pfizer

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