A rising tide doesn't lift all boats. For example, a boat with gaping holes in its hull will sink regardless of how high the tide rises. Pfizer (PFE 1.32%) seemed to be the investing equivalent of such a boat in 2025.
Shares of the pharmaceutical giant declined 6% last year, experiencing several significant fluctuations along the way. Can Pfizer's stock bounce back in 2026?
NYSE: PFE
Key Data Points
The case for a Pfizer rebound
It's entirely possible that Pfizer stock will indeed rebound this year. Perhaps the most likely reason for a bounce is the potential for positive clinical results that excite investors.
Many will particularly watch data from Metsera's obesity drug, MET-097i. Pfizer completed its acquisition of the company in November 2025. The deal added Metsera's promising obesity drug programs to Pfizer's pipeline. Results from the Phase 2b Vesper-2 and Vesper-3 clinical studies evaluating MET-097i in the treatment of type 2 diabetes are expected in early 2026.
MET-097i has already advanced into late-stage testing, thanks to the strength of its Vesper-1 clinical trial data. However, positive results from the other two studies could increase investors' enthusiasm about Pfizer's prospects in the lucrative obesity drug market.
Another argument for Pfizer's shares gaining momentum in the new year is that the company will face less uncertainty related to the Trump administration's tariffs, with its agreement made in 2025 with the U.S. government. The removal of this uncertainty could be akin to runners taking off ankle weights that have slowed their speed.
Investors could also come to believe that Pfizer's valuation more than reflects its challenges. The stock trades at a forward price-to-earnings ratio of 8.5.
Image source: Getty Images.
Why another lackluster performance could be in store
However, the reality is that another lackluster performance from Pfizer could be in store for 2026. The big drugmaker has already provided uninspiring guidance for the new year.
Pfizer expects revenue of $59.5 to $62.5 billion in 2026. The midpoint of this range is below the $62 billion projected for the full year 2025.
Despite additional cost savings in 2026, Pfizer also forecasts that its adjusted earnings per share (EPS) will likely decline year-over-year. The midpoint of the company's adjusted EPS range for 2026 is roughly 5.7% below the midpoint of its adjusted EPS guidance range for 2025.
There are two major culprits behind these reduced expectations. First, Pfizer projects that its COVID-19 products will generate around $1.5 billion less in 2026 than they did in 2025. Second. The company anticipates a negative revenue impact of roughly $1.5 billion resulting from some products losing market exclusivity.
Pfizer's patent cliff is likely to worsen over the next couple of years. Blockbuster blood thinner Eliquis loses patent protection in 2026, but it won't face generic competition until 2028. Cancer drugs Ibrance and Xtandi lose patent exclusivity in 2027. Investors may resist the temptation to buy Pfizer's stock this year, even if the company reports good news from its pipeline, because they anticipate more bad news is on the way.
Looking on the bright side
My best guess is that Pfizer's stock probably won't see a significant, lasting rebound this year. On the other hand, I don't think Pfizer's share price will sink dramatically lower, either.
That's not horrible news if you're an income investor. Pfizer's forward dividend yield is around 6.8%. Even if the stock essentially treads water in 2026, the dividend remains attractive.
And, no, I don't think Pfizer will cut its dividend anytime soon. The drugmaker lacks significant financial flexibility for dividend increases, but it's generating sufficient free cash flow to cover the dividend at its current level.
Pfizer's long-term future could also be much better than its near-term prospects. Management expects that new products and late-stage candidates will help return the company to growth within a few years. Pfizer may be similar to a boat with holes in its hull now, but those holes should be plugged enough for it to rise with the tide before the end of the decade.
