The Value in Pfizer (NYSE:PFE)

Pfizer Inc. (NYSE:PFE) provides the sole competition to Johnson and Johnson in terms of market value. Consider this though, the large-cap pharmaceutical sector has underperformed the broad market for the past decade. Pfizer may now be set to soar because in terms of valuation, it is a cheap stock.

Financial Partners Capital Management (FPCM) reports , “We believe that large-cap pharma is undervalued, and in particular, we think Pfizer (PFE) is a very attractive stock to own regardless of one’s view on the macroeconomic environment. Investors’ expectations are very low for the large-cap pharma sector as evidenced by the companies’ low valuation multiples and the contraction in multiples over the past decade. We are likely to see positive news from the industry’s R&D pipeline as most companies have refocused their R&D on new product innovation as opposed to developing “me-too” drugs during the past decade.”

FCPM also believes “While PFE’s top line will be sluggish over the next several years, the company can generate moderate earnings growth due to significant cumulative net cost savings of $4 billion to $5 billion from the Wyeth acquisition and has an attractive current dividend yield of 4.5%.”

Over the past 12 months Pfizer Inc (PFE) shares have traded between a 52-week low of $14.00 and its 52-week high of $20.36. Pfizer Inc shares are now trading with a P/E Ratio of 13 and EPS of 1.26. PFE shares are trading at $16.30, down -1% or $-0.17 and volume is currently at 22.78M shares traded.

Read more about FCPM’s view on Pfizer.