Pfizer (NYSE:PFE) has been under pressure despite reporting better-than-expected fourth-quarter results. The pharmaceutical giant, known for its COVID-19 vaccine and antiviral treatments, is navigating a post-pandemic world while focusing on cost-cutting, innovation, and dividend growth. Investors are now wondering: Is Pfizer stock poised for a rebound in 2025?

Strong Q4 Earnings, but Market Remains Cautious

Pfizer posted impressive fourth-quarter (Q4) earnings, with total revenue climbing 22% year-over-year to $17.8 billion. Adjusted earnings per share (EPS) surged to $0.63, a significant improvement from $0.10 in the previous year. This growth was driven by strong sales of its antiviral drug Paxlovid, which generated $727 million, and contributions from its recently acquired Seagen portfolio.

However, its COVID-19 vaccine, Comirnaty, saw a 38% decline in sales, contributing $3.4 billion in revenue. While Pfizer’s diversified drug portfolio continues to perform well, the market remains cautious due to uncertainty surrounding future revenue streams.

For the full year 2024, Pfizer reported a 7% revenue increase to $63.6 billion, while adjusted EPS jumped 69%. The company also outlined ambitious cost-cutting plans, aiming to save at least $4 billion by 2025 and an additional $1.5 billion through manufacturing optimizations by 2027.

Will Pfizer’s Growth Strategy Pay Off?

Pfizer’s pipeline is a key factor in its stock forecast. The company has nine Phase 3 readouts, 13 pivotal programs set to begin, and four expected regulatory approvals in 2025. Management remains confident in returning to pre-pandemic operating margins, driven by its focus on oncology, vaccines, internal medicine, and immunology.

Additionally, Pfizer is leveraging artificial intelligence (AI) to optimize drug development and sales, positioning itself for long-term growth. The company is also reducing its reliance on COVID-19-related revenue by expanding into oncology and rare diseases.

Despite these efforts, analysts predict Pfizer’s earnings may decline by 5% in 2025 before rebounding with a projected 3.5% increase in 2026.

A High-Yield Dividend Stock

One of the most attractive aspects of Pfizer stock is its dividend. With a forward dividend yield of 6.7%, Pfizer stands out in the healthcare sector, where the average yield is around 1.6%. In 2024 alone, the company paid $9.5 billion in dividends, maintaining its track record of 16 consecutive years of dividend growth.

Pfizer’s payout ratio of 56.5% suggests sustainability, allowing for future dividend increases. The company’s balanced approach to capital allocation—paying dividends, reducing debt, and reinvesting in growth—makes it appealing to income-focused investors.

Wall Street’s Take on Pfizer Stock

Analysts have mixed views on Pfizer stock. Gabelli Funds believes the company’s renewed cost discipline will help stabilize earnings. Meanwhile, Leerink Partners analyst David Risinger maintains a “Hold” rating with a $28 price target, citing long-term uncertainty tied to upcoming clinical trials.

Currently, Pfizer holds a “Moderate Buy” rating from Wall Street analysts. Out of 23 analysts covering the stock, 10 rate it a “Strong Buy,” 12 recommend a “Hold,” and one suggests a “Strong Sell.” The stock’s average price target of $30.65 implies a potential 19.5% upside, with a high target of $36 suggesting gains of over 40% in the next 12 months.

Final Verdict: Should You Buy Pfizer Stock?

Pfizer’s recent earnings report highlights a company in transition. While declining COVID-19 sales remain a concern, the company’s strong pipeline, cost-cutting measures, and dividend growth provide reasons for optimism. Investors seeking stability and income may find Pfizer stock attractive, while those looking for high-growth opportunities might wait for more clarity on its long-term trajectory.

With analysts divided, the Pfizer stock forecast for 2025 hinges on its ability to execute its growth strategy while maintaining financial discipline.

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