Most investors who have been following Pfizer (NYSE:PFE) for awhile can't be overly pleased with how it has fared over the last five years. The big drugmaker badly underperformed the S&P 500 during the period. Its trailing-12-month revenues are lower today than they were at the end of 2015. And even after adjusting for divestitures, it hasn't delivered tremendous sales growth.

However, Pfizer today is in a far different position than it was even in its recent past. There are definitely reasons to be more optimistic about the company's future. Where will Pfizer be in five years? Here's my best-guess scenario.

Timeline with a pushpin next to 2025

Image source: Getty Images.

What's happening at Pfizer now?

Perhaps the best way to predict what will happen with Pfizer is to look at its present situation and attempt to predict which of the current trends are likely to continue. Arguably the most important factor to consider is that the company's results will no longer be dragged down by the declining sales of its older, off-patent drugs. Thanks to the recent merger of the company's former Upjohn unit with Mylan, Pfizer is in a stronger position to grow than it has been in for quite a while.

CEO Albert Bourla forecasts that the company will deliver annual revenue growth of around 6% on a risk-adjusted basis over the next five years with adjusted earnings per share increasing by 10% per year. Those targets seem attainable. Pfizer has several solid growth drivers, notably including Vyndaqel, which is approved for treating the rare genetic disease transthyretin amyloid cardiomyopathy, and blood thinner Eliquis.

The drugmaker will still face some headwinds, though. Sales for blockbuster autoimmune disease drug Enbrel will likely continue to slump in the face of stiff competition. Pfizer's top-selling pneumococcal vaccine, Prevnar 13, could soon face new competition if Merck wins U.S. and European approval as expected for its pneumococcal vaccine candidate, V114. Breast cancer drug Ibrance also probably won't be as big of a winner as Pfizer hoped after it failed in late-stage studies as a potential adjuvant treatment.   

It's important to note that Bourla's 6% annual growth figure doesn't include any impact from BNT162b2, the COVID-19 vaccine developed by Pfizer and its partner, BioNTech. The two companies recently filed a request for an emergency use authorization with the FDA. The chances of the regulator granting that request appear to be high, considering that the interim trial data the companies delivered for the vaccine earlier this month showed it to have 95% efficacy and a good safety profile. Assuming BNT162b2 receives a green light in the U.S. and other key markets, the two partners stand to make billions of dollars from it over the next year, and potentially a lot more over the longer term.

Wild cards

If everything moves forward based on how things look right now, Pfizer probably will generate mid-single-digit-percentage annual sales growth and even stronger earnings growth. However, there are always extra wild cards for pharmaceutical companies

One obvious uncertainty is how well its pipeline candidates will pan out. Pfizer's currently awaiting regulatory approval decisions for six programs. Two of those are fairly important to the company's future: abrocitinib in treating atopic dermatitis and tanezumab in treating osteoarthritic pain.

Pfizer's pipeline also includes 21 late-stage programs. Several of those could be key components in the company achieving its revenue growth goals, with pneumococcal vaccine PF-06482077 especially standing out.

These clinical programs don't present as much risk for Pfizer as you might think, though. The company estimates that it needs only around 40% of its non-risk-adjusted projected pipeline revenue in order to hit its 6% annual growth objective. That gives it a comfortable cushion even if there are clinical trial setbacks.

Another potential wild card that investors shouldn't overlook is the potential for acquisitions. Pfizer's last big purchase, of Array Biopharma, closed in July 2019. The company has never been shy about making deals, so it's quite possible that it could pull the trigger on another growth-driving acquisition in the next five years.

Pfizer's most likely future

So where will Pfizer be in five years? In some respects, exactly where it is now -- ranked among the biggest pharmaceutical companies on the planet, and holding a strong lineup of blockbuster products and a huge pipeline. However, my prediction is in 2025, Pfizer will be a much more attractive company than it has been in recent years.

I expect Pfizer to surpass its growth goals, thanks in part to the contributions from BNT162b2. My hunch is that the company will capture more than the 40% pipeline revenue growth that it's included in projections. I also will be stunned if it doesn't make at least two M&A deals over the next five years that have the potential to move the needle.

In short, I look for Pfizer to deliver market-beating total returns through 2025 with a return to solid growth combined with an attractive dividend. Today, its market cap stands at around $200 billion, and I won't be surprised if it reaches $350 billion within the next five years. Sure, my optimism could prove to be wrong -- but I really like Pfizer's chances.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.