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Exclusive Story from MarketBeat Media Why Wall Street Gave Up on Pfizer—and Why That May Be a MistakeSubmitted by Jeffrey Neal Johnson. Article Published: 12/31/2025. 
In Brief - Pfizer trades at a historic discount compared to its peers while paying a dividend yield that significantly outperforms the broader market average.
- Strategic acquisitions have established a robust pipeline of next-generation cancer treatments, which are driving growth.
- Management has aggressively re-entered the weight-loss market with new assets, including one that offers a convenient monthly dosing schedule for patients.
The market of 2025 will be remembered for its extremes. Investors poured billions into technology giants and companies producing weight-loss drugs, while traditional pharmaceutical leaders were largely left behind. Nowhere is that more evident than with Pfizer Inc. (NYSE: PFE), which finished the year trading near multi-year lows around $25 and ranks among the most unloved assets in the S&P 500. At first glance the pessimism appears justified: Pfizer has spent the past two years wrestling with a perfect storm. Revenue from COVID-19 products declined faster than expected, several high-profile pipeline candidates failed in clinical trials, and activist investors mounted pressure on management. A former hedge fund manager known for cutting through market noise is briefly opening access to his flagship trading strategy. In a short demo, he explains how his "One Ticker" approach works — and how readers can access the full service for a year at a steep discount. Watch the brief demo here But the worst of that storm may be behind the company. With activist Starboard Value exiting in November and management resetting financial guidance to more realistic levels, many of the major overhangs have cleared. The bad news is largely out, and Pfizer's stock price looks to have found a floor. Entering 2026, Pfizer presents a rare setup: a blue-chip firm trading at distressed levels, paying a meaningful dividend, and quietly rebuilding its pipeline. The Mathematical Case: Why the Price Is Wrong For value investors, the thesis is straightforward. The market currently values Pfizer as if its earnings will permanently shrink, creating a disconnect between the share price and the company's underlying cash generation. A Historic Valuation Gap Pfizer trades at a forward price-to-earnings ratio (P/E) of roughly 8.6x. By comparison, the average pharmaceutical company trades at 15x–20x earnings, and high-growth peers like Eli Lilly (NYSE: LLY) command substantially higher multiples. A P/E near 8.6x implies the market expects little to no growth. That low bar is a positive for investors: Pfizer doesn't need a miracle to appreciate. It simply needs to prove the business can stabilize. Any modest earnings beat could prompt multiple expansion as the stock converges toward industry norms. The Dividend Shield While investors wait for a re-rating, the company is paying a meaningful yield: - Annual payout: $1.72 per share.
- Current yield: Approximately 6.9%.
That yield is roughly four times the S&P 500 average and provides a margin of safety. Even if the share price remains flat in 2026, a near-7% dividend offers a solid baseline return that outpaces most savings accounts and many government bonds. Management is supporting the dividend through a $4 billion cost-saving program. By trimming administrative bloat and optimizing manufacturing, the company is protecting cash flow to keep quarterly payouts intact. The New Foundation: Oncology Takes the Lead One of the biggest criticisms of Pfizer is the growth gap left by the decline of its COVID business. To fill that hole, the company has shifted aggressively into oncology. Guided-missile technology A jewel of Pfizer's 2023 acquisition of Seagen is leadership in Antibody-Drug Conjugates (ADCs). Where traditional chemotherapy is a broad blast that affects healthy and cancerous cells alike, ADCs act more like guided missiles — identifying specific cancer cells and delivering a toxic payload directly, which can spare healthy tissue. This technology is already contributing revenue. The Seagen portfolio added roughly $3.4 billion in 2024 and delivered about $2.75 billion in the first three quarters of 2024, driven in part by strong sales of Padcev for bladder cancer. Navigating the bumps The run hasn't been entirely smooth. In December 2025 Pfizer reported a safety signal related to Hympavzi, where a patient death in a trial extension prompted concern and a temporary pullback in the stock. While this rattled investors, it does not erase the broader thesis. The oncology pipeline is deep — more than 60 programs are in development — and Pfizer recently licensed a promising bispecific antibody from 3SBio, illustrating its ongoing efforts to reload the pipeline with potential blockbusters. Catching Up: The Strategy for Weight Loss After Danuglipron failed to advance, Wall Street largely wrote off Pfizer's prospects in the high-profile weight-loss market. Rather than concede the space, Pfizer pivoted through strategic deals in late 2025 to re-enter the race. The injectable strategy (Metsera) In November, Pfizer acquired Metsera for about $7 billion, gaining ownership of a next-generation injectable candidate (MET-097i). Unlike current weekly injectables, this candidate could potentially be administered monthly, offering a clear convenience advantage. The oral strategy (YaoPharma) Recognizing that some patients prefer pills, Pfizer also licensed a small-molecule GLP-1 candidate from YaoPharma, giving it an oral approach to complement the injectable program. Why this matters The market currently assigns little to no value to Pfizer's weight-loss pipeline. That creates a free option for investors: with expectations at rock bottom, any clinical progress from Metsera or YaoPharma assets would represent pure upside. Pfizer does not need to be first to benefit — it only needs to capture a meaningful slice of what could become a $100 billion market. The Risk/Reward Equation: 2026 Belongs to Value Pfizer enters 2026 as a company in transition but with a strengthened balance sheet. Management has set a revenue floor of roughly $61 billion for 2026, a credible target that removes some of the uncertainty that drove the stock lower. For investors the math is straightforward. At about $25 per share, downside is cushioned by the dividend and an already depressed valuation. Upside is significant: continued oncology momentum or any wins in the weight-loss programs could trigger a sharp re-rating. Unloved stocks one year often become the market's standouts the next. With the activist drama behind it and the balance sheet stabilized, Pfizer has moved from a falling knife to a potential core holding for value-focused portfolios. 2026 may be the year the sleeping giant finally wakes up.
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