00:00 brian
On Tuesday, I introduced Delta Air Lines here ahead of my chat with CEO Ed Bassin at an investment event. Today, I’ll be sitting with Albert Borla, the long-time CEO of Invest, so I’d like to take a quick look at Pfizer. It’s been an eventful few months for Pfizer. The battle between Novo Nordisk and weight-loss drug startup Metsala is tough. The company won that battle with a $10 billion offer. Pfizer also worked with the Trump administration to lower drug costs for Americans. Concerns about Pfizer’s patent expiration
00:30 brian
It’s interesting to see such a world-class platform trading at only 8x forward earnings. The company’s dividend yield is approximately 6% or more. The stock price has declined slightly over the past year. For Stephanie, I’m going to look at Stephanie Gill, Brooke De Palma, and Ness. Well, what do you make of this weakness in the pharmaceutical, medical field?
01:03 Stephanie Gill
We actually like the drug and healthcare fields, but we don’t like everything. We’re going to choose wherever we want. Well, Pfizer wasn’t that appealing to us. You know, these are their growth and the pipeline will be completed in probably two to three years. Well, this deal with Melo was a little weird. I read the other day that the FTC called Pfizer and said maybe you don’t want to move forward with this. And that’s a big problem for their pipeline. Well, our view is that when
01:36 Stephanie Gill
Things are coming off patent, but that’s still a few years away since valuations typically don’t bottom out until about 2-3 months before it actually starts. Well, I think it’s kind of like a show-me story, no matter how cheap it is. However, we are not seeing strong growth. There are other names, but you can actually see them. We also, like Lilly, um, we’re holding it in our Robinhood strategy. The same goes for Amgen, for example.
01:59 brian
And as I mentioned yesterday when I mentioned Delta, they were also trading at about 8 times forward earnings. It’s strange to see these iconic companies, these big cash flow generating companies, trading at such multiples. And on the other end of the spectrum, OpenAI is losing billions of dollars and gaining a higher valuation. There are other AI companies with impressive valuations that are just getting started. However, there is a lot to do.
02:29 Nezu
Well, this year has gotten off to a tough start when it comes to healthcare companies. XLV is up 10% year-to-date, but much of that gain has occurred since August. As for Pfizer, I mean, I thought the exciting thing that Pfizer talked about earlier this year was actually in an article where they talked about using AI for medical breakthroughs and basically saying that instead of doing research in the lab, they’re going to use AI, they’re going to do testing using AI.
03:00 Nezu
compound. I think that’s the medical field. It’s how we incorporate AI into these medical advances to test all kinds of different drugs, to talk about disease, to look at it through a lens. That’s the most exciting part of the healthcare industry for me.
03:13 brian
Yes, Brooke, Nez brought up a good point. AI could be the next big thing for industries that have been challenged in the past.
03:22 Brooke DePalma
Brian, you’re right. And what I actually heard on the Soxson Translation episode that I got to sit on was that one of the sources that was there said that pharmaceuticals could be the next big area for AI and could bring momentum there. Once AI is fully integrated into many tech stocks, it will probably be the next sector to watch. Eli Lilly in particular is getting into AI, and we hear that different companies are looking to integrate in different ways.
03:49 Brooke DePalma
Bring AI into your daily work. And that’s actually what we’re seeing, this technology rally, this AI rally, that may be continuing right now, and sources say this could provide momentum to other sectors as well. So it’s definitely something I’m keeping an eye on.
04:05 brian
Okay, you just heard me describe Pfizer. As I mentioned earlier, I will be speaking with Albert Bourla, CEO of Pfizer’s Invest. He’s just one of the market-moving celebrities scheduled to attend. Don’t miss the all-day Yahoo Finance Invest Live tomorrow, November 13th. I’m really looking forward to having that conversation.
