Dow Jones Review: Pfizer

The following video is part of our "Motley Fool Conversations" series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.

Over the next couple of weeks, John and David will be revisiting some calls they made on individual stocks of the Dow. Today, they're checking out Pfizer. This company is up an impressive 10% in 2012 compared with a roughly 5% gain for the Dow average as a whole.

John and David gave Pfizer an underperform earlier this year, thinking it would not beat the market over the next five years. Clearly, they have been very wrong in the short term. The company's stock has been on fire this year, as has fellow Dow component Merck. Although revenue has been contracting, the company has been doing a good job of cutting costs.  But there's still plenty of competition out there from the likes of Novartis and the ever-present Teva Pharmaceuticals. The yield has come down considerably to 3.7% since the original call, as investors have bid up the share price. David is sticking by his underperform call, though, because over the long run, he just doesn’t think the performance will be there.

Pfizer is one of the highest-yielding stocks in the Dow. If you'd like to learn about additonal income generating stocks,The Motley Fool has compiled a special free report outlining our nine top dependable, dividend-paying stocks. It's called  "Secure Your Future With 9 Rock-Solid Dividend Stocks." You can access your complimentary copy today at no cost! Just click here to discover the winners we've picked.

David Meier has no positions in the stocks mentioned above. John Reeves has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Novartis, Pfizer, and Teva Pharmaceutical Industries. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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