Why Pfizer Stock Is Lower After a Beat-and-Raise Quarter

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Pfizer (PFE) stock is lower in Tuesday's session even after the pharmaceutical giant beat top- and bottom-line expectations for its third quarter and raised its full-year outlook.

In the three months ended September 29, Pfizer's revenue increased 31.3% year over year to $17.7 billion. What's more, the company swung to a net profit of $1.06 per share from a loss of 17 cents per share in the year-ago period.

"We delivered another strong quarter of results as we continued to execute with discipline, strengthen our commercial position and advance our pipeline," said Pfizer CEO Dr. Albert Bourla in a statement. "Our performance through the first three quarters of the year is the result of our focus on our most important strategic priorities."

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The results handily beat analysts' expectations. Wall Street was anticipating revenue of $15 billion and earnings of 62 cents per share, according to Yahoo Finance.

"The focus on execution excellence is starting to deliver results with market share gains in the U.S. and International, as well as robust growth in revenues and earnings per share," Bourla said in prepared remarks. "As a result, we are raising guidance ranges for our full-year 2024 total revenue and adjusted diluted earnings per share."

Pfizer now anticipates revenue in the range of $61 billion to $64 billion and earnings per share to arrive between $2.75 to $2.95. This is higher than its previous forecast for revenue of $59.5 billion to $62.5 billion and earnings per share to land between $2.45 to $2.65.

"I'm confident that we will deliver on our financial commitments in 2024 and that we are well positioned to continue advancing scientific breakthroughs meaningful to our patients and our company, as well as creating long-term shareholder value, in the years to come," Bourla said.

Despite the strong results, some media outlets are pointing to the outsized boost from Pfizer's Covid-19 treatments on its quarterly results and guidance raise. "Investors don't have much faith in the long-term value of the company's Covid-19 business, and those results are unlikely to inspire much investor optimism," as Barron's explains.

Is Pfizer stock a buy, sell or hold?

Pfizer shares are up nearly 5% for the year to date on a total return basis (price change plus dividends), lagging the S&P 500's 23% gain. But several on Wall Street think PFE is one of the best stocks to buy at current levels.

According to S&P Global Market Intelligence, the average analyst target price for the healthcare stock is $33.20, representing implied upside of more than 16% to current levels. Additionally, the consensus recommendation is Buy.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.