Pfizer’s 2026 Outlook

Revenue Guidance: $59.5-62.5 billion Adjusted EPS: $2.80-3.00 Current Price Context: At recent trading around $25-26/share, this implies a forward P/E of roughly 8.3-9.3x

Key Growth Drivers

1. Pipeline Catalysts (Major Near-Term)

• ~20 pivotal trial starts planned for 2026
• Ultra-long-acting GLP-1 (obesity): Phase 2b showing robust monthly dosing results
• Padcev (oncology): Multiple approvals in bladder cancer expanding market
• Braftovi: New colorectal cancer indication data
• 10 pivotal trials for Metsera obesity assets ($7B acquisition)

2. Revenue Composition

• Non-COVID portfolio growing 6% operationally (solid base)
• COVID products: ~$5B expected (declining but stabilizing)
• Loss of exclusivity headwind: ~$1.5B negative impact

3. Strong Performers

• Vyndaqel family (heart disease): 7% growth
• Eliquis (anticoagulant): 8% growth
• Padcev (oncology): 15% growth
• Prevnar (pneumococcal): 8% growth

Industry Comparison

Large-Cap Pharma Peers

Eli Lilly (LLY)

• 2026E Revenue: ~$58-62B (similar size)
• Growth Rate: 20%+ driven by obesity (Mounjaro/Zepbound)
• P/E: ~50x (significantly higher valuation)
• Key Difference: Lilly dominates obesity market NOW; Pfizer is 2-3 years behind

Novo Nordisk (NVO)

• Obesity leader with Ozempic/Wegovy
• Trading at premium multiples (30-35x)
• Pfizer’s GLP-1 won’t compete until 2027-2028 at earliest

Merck (MRK)

• Similar valuation (low teens P/E)
• Strong oncology (Keytruda) but facing LOE in 2028
• More stable, less upside potential than Pfizer

Bristol-Myers Squibb (BMY)

• Lower valuation (~8-10x P/E)
• Similar challenges with LOE and pipeline execution
• Comparable risk/reward profile

Johnson & Johnson (JNJ)

• More diversified (devices, consumer)
• Higher quality rating, lower growth
• P/E around 14-16x

Pfizer-Specific Factors

Positives

1. Deeply undervalued vs. historical norms (traded 15-20x P/E pre-COVID)
2. Pipeline richness: 11 pivotal starts in 2025, 20 planned for 2026
3. Obesity optionality: If GLP-1 succeeds, massive upside (but years away)
4. 3.5% dividend yield provides downside support
5. $8.8B in business development shows aggressive growth stance

Negatives

1. Execution risk: Track record of pipeline disappointments
2. Obesity timeline: 2027-2028 before meaningful revenue
3. COVID dependency: Still $5B (8% of revenue) from declining products
4. Political headwinds: TrumpRx pricing pressure, tariff concerns
5. Intangible impairments: $4.4B Q4 2025 writedowns signal judgment issues

Conservative Projection (2026-2028)

2026:

• Revenue: $61B (midpoint)
• EPS: $2.90 (midpoint)
• Stock: $26-32 range (9-11x P/E)

2027:

• Revenue: $63-65B (low single-digit growth)
• EPS: $3.10-3.30
• Stock: $28-36 (assuming market gives 10-11x on improving pipeline)

2028:

• Revenue: $67-72B (if GLP-1 launches successfully)
• EPS: $3.50-4.00
• Stock: $35-48 (if obesity story gains traction, multiple expands to 12-14x)

Investment Verdict

Compared to Industry

Pfizer is a VALUE play, not a GROWTH play (unlike Lilly/Novo)

Better than: BMY (similar challenges, weaker pipeline) Similar to: MRK (good value, execution risk) Worse than: LLY/NVO (but trading at 1/5 the valuation) More conservative than: JNJ (but higher upside potential)

Risk-Adjusted Return Scenarios

Bull Case (30% probability): $45-50 by 2028

• GLP-1 succeeds, pipeline delivers, multiple re-rates to 14x
• 3-year return: ~90%

Base Case (50% probability): $32-38 by 2028

• Modest growth, pipeline mixed results, dividend sustained
• 3-year return: ~35-40%

Bear Case (20% probability): $22-26 by 2028

• Pipeline failures, obesity flops, COVID evaporates faster
• 3-year return: Flat to -15%

Bottom Line

Pfizer offers asymmetric risk/reward at current prices. The market is pricing in minimal pipeline success and no obesity upside. Given the dividend floor, downside is limited to ~15-20%, while upside could be 50-90% if even half the pipeline delivers.

For a Protected Wheel/Collar strategy: PFE is excellent due to:

• High implied volatility (option premiums rich)
• Strong dividend support
• Clear technical support levels
• Low correlation to high-flying tech

Relative to industry: It’s the cheapest major pharma with the most catalysts over the next 24 months. Whether those catalysts deliver is the $100B question.