Shares of Pfizer (PFE 0.55%) were sinking 8.3% lower as of 11:25 a.m. ET on Wednesday. The sharp sell-off came after the drugmaker provided its guidance for full-year 2024.
Pfizer expects 2024 revenue of between $58.5 billion and $61.5 billion. This range includes a contribution of around $3.1 billion from the company's pending acquisition of Seagen. It reflects little to no year-over-year growth from Pfizer, which is on track to generate revenue of $58 billion to $61 billion in 2023.
The pharma giant also projects adjusted diluted earnings per share (EPS) of between $2.05 and $2.25 in 2024, again including the expected impact of the Seagen acquisition. Pfizer anticipates delivering adjusted diluted EPS of $1.45 to $1.65 in full-year 2023.
Why is Pfizer's 2024 outlook so weak?
Pfizer continues to experience a steep decline in sales for COVID-19 vaccine Comirnaty and antiviral drug Paxlovid. The company expects combined sales for the two products in 2024 will total only $8 billion, down from a projected $12.5 billion this year.
If the negative impact of its COVID-19 products is factored out, Pfizer's year-over-year operational revenue growth in 2024 should be between 8% and 10%. However, investors can't ignore the big hole that the slumping demand for Comirnaty and Paxlovid is causing.
Is Pfizer stock a buy on the pullback?
It's possible that we could see analyst downgrades for Pfizer after its disappointing 2024 guidance. However, some on Wall Street think the drugmaker's valuation is too compelling to pass up.
My view is that Pfizer isn't likely to rebound until it beats quarterly earnings estimates. When that might happen is anyone's guess. I think, though, that the stock should be attractive to income investors with its dividend yield now close to 6.3%. I also expect that Pfizer will return to solid growth once it moves past the challenging year-over-year comparisons for its COVID-19 products.
This stock isn't one to buy on the pullback for investors with a short-term focus. For those with a long-term perspective who are seeking juicy dividends, however, buying Pfizer after today's sell-off could be a smart move.
