3 Reasons Pfizer Stock Could Be a Steal of a Deal in 2025

Source The Motley Fool

If you're looking for reasonably priced stocks to pick up right now, you shouldn't overlook Pfizer (NYSE: PFE). The pharmaceutical giant isn't as risky an investment as it may appear to be. Its financials aren't in bad shape, and while the stock has been struggling, now could make a great time to load up on it.

Here are three reasons why Pfizer could prove to be a steal of a deal this year.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

1. It's trading at an incredibly low earnings multiple

Buying quality stocks at decent valuations can give you a good margin of safety and minimize your investment risk. And while many stocks trade at cheap valuations because they are highly risky, that isn't the case with Pfizer.

There is some uncertainty about the company's growth prospects, especially as patent protections on several important drugs in its portfolio will expire soon, but I don't believe the stock should be as heavily discounted as it is right now. The company is guiding for revenue of between $61 billion and $64 billion for 2025, which is comparable to how much it reported this past year ($63.6 billion).

While that range does suggest a modest decline on the top line is likely, the company is still investing in growth opportunities -- its growth days are by no means over.

Currently, the stock trades at a forward price-to-earnings (P/E) multiple of less than 9, based on analysts' expectations for the year ahead. By comparison, the average stock in the Health Care Select Sector SPDR Fund trades at a forward P/E of nearly 18, making Pfizer look like a deeply discounted stock today.

2. Its dividend can buffer investors' returns against market declines

The stock market is facing a lot of additional uncertainty this year due to President Trump's tariffs and trade wars. In times like these, investors may look for safety in the form of dividend income. At the current share price, Pfizer's dividend yields a mouthwatering 6.7%, so it could become a more popular option among income investors. That payout is well above the S&P 500's average yield of 1.4%.

Those dividend payments could help serve as a buffer if stock prices suffer amid challenges to the economy this year. While investors may be worried about the sustainability of the dividend, it doesn't look to be in any danger. In 2024, Pfizer generated free cash flow of $9.8 billion, which was more than the $9.5 billion it paid out in dividends.

3. The company looks to still be in acquisition mode

Pfizer previously told analysts and investors that it wanted to add $25 billion to its top line by 2030 via acquisitions and through its pipeline. CEO Albert Bourla says that the company has added about $20 billion thus far, with its acquisition of oncology company Seagen in 2023 contributing a big piece of that sum.

While another big deal like that may not be on the horizon, Bourla did say on the company's earnings call in February that "we are looking at more strategic opportunities right now, which will enhance pipeline in areas that we would like to play rather than near-term revenues."

By the sound of it, the company may be looking at more modestly sized acquisitions that could help ensure that Pfizer hits its revenue target. If that happens, that could be a catalyst that lifts the healthcare stock higher, as it might alleviate some concerns about the business.

It's a solid stock, but you'll likely need to be patient

Pfizer has been a cheap stock for a while, and barring some big development, it's likely that it'll take some time before it starts to rally again. The good news is that with meaningful acquisitions and stable financials, the stock looks to have a lot of upside potential. The market's view of the risks the business faces appears to be overblown.

So for investors who are willing to buy shares of Pfizer sooner rather than later, the payoff could be substantial, both from the potential share price gains and from the dividend income they could accumulate over the years.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

  • Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $304,759!*
  • Apple: if you invested $1,000 when we doubled down in 2008, you’d have $40,808!*
  • Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $517,445!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

Continue »

*Stock Advisor returns as of March 18, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Pfizer. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
XRP Price Prediction: Fibonacci And Elliott Wave Analysis Suggests $15 By May 2025Egrag Crypto, a well-known crypto analyst on the social media platform X, recently shared an optimistic price prediction for XRP. According to the analyst, technical analysis of the XRP price on the
Author  NewsBTC
Dec 30, 2024
Egrag Crypto, a well-known crypto analyst on the social media platform X, recently shared an optimistic price prediction for XRP. According to the analyst, technical analysis of the XRP price on the
placeholder
Ripple (XRP) Price Sees a Surge, Solana Targets $600 in 2025 as Investors Increase Focus on New AltcoinThe cryptocurrency market is showing renewed momentum as Ripple (XRP) experiences a significant price surge, and Solana (SOL) sets its sights on a bold $600 target by 2025. Meanwhile, a rising altcoin, Lightchain AI, is capturing investor attention with its innovative ecosystem and strong presale performance, making it a compelling choice for forward-looking investors. Ripple […]
Author  Cryptopolitan
Jan 15, Wed
The cryptocurrency market is showing renewed momentum as Ripple (XRP) experiences a significant price surge, and Solana (SOL) sets its sights on a bold $600 target by 2025. Meanwhile, a rising altcoin, Lightchain AI, is capturing investor attention with its innovative ecosystem and strong presale performance, making it a compelling choice for forward-looking investors. Ripple […]
placeholder
Bitcoin Outlook 2025As the Bitcoin market continues to mature, its 2025 outlook appears highly favourable, driven by institutional adoption and regulatory developments.
Author  TradingKey
Jan 23, Thu
As the Bitcoin market continues to mature, its 2025 outlook appears highly favourable, driven by institutional adoption and regulatory developments.
placeholder
What Crypto Whales are Buying For May 2025Crypto whales are making bold moves heading into May 2025, and three tokens are standing out: Ethereum (ETH), Artificial Superintelligence Alliance (FET), and Onyxcoin (XCN).
Author  Beincrypto
Apr 21, Mon
Crypto whales are making bold moves heading into May 2025, and three tokens are standing out: Ethereum (ETH), Artificial Superintelligence Alliance (FET), and Onyxcoin (XCN).
placeholder
Gold Price Forecast: XAU/USD attracts some sellers below $3,250 on firmer US DollarThe Gold price (XAU/USD) extends the decline to around $3,245 during the early Asian session on Thursday. The precious metal edges lower to near a two-week low amid easing US-China trade tensions and stronger US Dollar (USD) demand. 
Author  FXStreet
May 01, Thu
The Gold price (XAU/USD) extends the decline to around $3,245 during the early Asian session on Thursday. The precious metal edges lower to near a two-week low amid easing US-China trade tensions and stronger US Dollar (USD) demand. 
goTop
quote