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| Symbol | Sector | Return | Exposure | Trades | Last Trade | Status | |
|---|---|---|---|---|---|---|---|
| PFE | Pharmaceuticals | -19.97% |
|
4 | 06-Aug-08 | Currently Holding |
24-Oct-07
PFE Rationale
Holding Rationale for PFE.
Valuation Completed: 10/11/07 Rating: Neutral Comments: This is the first time I have dropped the from a buy to neutral. I am concerned about what the true growth rate will be on a going forward basis. Return numbers are still impressive and the business is run well. I am pleased with the increased buyback and the higher dividend. My concern is that I think the dynamics of the drug industry are changing. I am concerned with their current pipeline and do not see the true driver of future growth. If the company can achieve a long-term growth rate near 9% the stock is skewed to the upside with a potential price in the low 40s. Coming off a bad year with more reasonable growth prospects I would put fair value at $25 and would look to buy near $22. The main advantage is there is limited downside from this point forward. In a market with 10yr US Treasuries yielding below 5%, PFE offers a near 4% yield. If we approach a point where I see limited opportunities in the market, this would be a great place to park money, earn a solid yield and see if the stock can rebound.
Tagged Stocks: PFE
Posted at 13:16 in Holding Rationales | Permalink | Comments (3) | Top
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3 Comments on "PFE Rationale"
Frozenrope18
Posted on 01-Jan-08 19:19 by frozenrope18
PFE returning to $25 now means a 40% return on equity and a great dividend to boot. Have you seen anything to change your views?
Posted on 12-Jul-08 04:11 by yaktipper
Posted on 14-Jul-08 16:43 by epicadv
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