Pfizer (PFE 0.44%) was a hot stock during the pandemic, but it has been crashing in recent years. The company's COVID vaccine resulted in the business posting record sales and profits in 2022. But then, as things went back to normal and demand diminished for its vaccine, so too did interest in Pfizer's stock.
What's startling, however, is the stock hasn't simply gone back to the levels it was at back before the pandemic -- it has been on a full-blown crash. Since 2023, the healthcare stock has lost more than half of its value. This year, it's reached levels it hasn't seen in 13 years. It seems like a steal of a deal. Except, no one is in a rush to buy Pfizer's stock. Investors are concerned about what lies ahead for the business and there are many question marks about its future growth.
Recently, the company released some positive earnings numbers. Could they mark a turning point for this struggling stock, and could now be a good time to invest in Pfizer?
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Pfizer posts strong Q2 numbers and boosts guidance
On Aug. 5, Pfizer released its second-quarter earnings for 2025. Revenue for the June quarter totaled $14.7 billion, rising 10% year over year. And it easily came in above analyst estimates of $13.6 billion. On the bottom line, its adjusted earnings per share (EPS) was $0.78, also smashing expectations of $0.58. It also raised its guidance, now projecting adjusted EPS between $2.90 and $3.10 for the full year (versus its previous guidance of $2.80 to $3.00).
With a result like that, you might have expected shares of Pfizer to take off. Not only did it beat expectations, it performed the highly coveted beat-and-raise combo. And yet, the stock has barely moved since releasing its quarterly numbers.
The stock is now being weighed down by other factors
Pfizer can't catch a break. Its strong earnings performance comes at a time when the U.S. government is threatening tariffs on imported pharmaceuticals and is trying to get pharma companies to reduce drug prices. This doesn't bode well for the company, as these types of developments could lead to shrinking numbers on both its top and bottom lines.
The good news is that this isn't a Pfizer-specific problem. These are industry headwinds weighing down healthcare stocks as a whole. The Health Care Select Sector SPDR Fund has declined by 13% in the past 12 months, which is similar to how Pfizer has performed over that stretch.
The bad news, however, is that there is so much uncertainty about how all these factors might play out, how they might impact Pfizer's financials, and how long they may last. With so many question marks, it's easy to see why investors may be looking elsewhere to invest.
Pfizer may be an ideal buy-and-wait stock
I don't know how government policies will play out, or how they'll affect Pfizer's business in particular. But I am confident that in the long run, policies will be put in place to incentivize pharma companies to develop life-saving drugs and treatments, not deter them. That's why regardless of what happens in the short term with respect to government actions, I don't believe that in the long run they will weigh down and impede Pfizer and other top healthcare businesses, which continually invest in their growth and the development of new drugs.
It may take a while before optimism returns to the healthcare sector, and Pfizer's stock may not end up rallying in the days or weeks ahead. But with the business's cost-cutting efforts paying off and the company exhibiting a lot of growth with the potential for even more in the long run, Pfizer may be one of the best stocks to put in your portfolio right now and simply forget about.
Plus, with a dividend yield of 7%, there's plenty of incentive to remain patient with the stock.
