Jim Cramer on Pfizer: “I Think It Can Be Near a Breakout”

Pfizer Inc. (NYSE:PFE) is one of the stocks Jim Cramer recently shed light on. Cramer highlighted some of the stock’s possible catalysts, as he commented:

“All right, next up, controversial, it’s Pfizer. It’s the big pharma titan, 6.9% yield. Now, I gotta tell you, these days I see Pfizer’s basically as a bond equivalent… It hasn’t given you much in the way of share price appreciation, hence its controversial nature. But since it yields nearly 7%, you can still get a decent return even if the stock does nothing. Although I obviously want it to do something… I think that Pfizer has the ability to use some of the businesses it’s acquired in recent years to build up a powerful pipeline, one that’s bountiful enough to offset the wave of patent expirations that everybody seems to be so worried about when it comes to Pfizer.

Pfizer used COVID cash to acquire Seagen, that’s a cancer specialist, and NURTEC, which is a revolutionary migraine treatment that they picked up from Biohaven Pharmaceuticals. Most recently, the company paid about $7 billion plus some milestone payment down to buy this company called Metsera, and that’s working on one of these GLP-1 weight loss drugs… Of course, pulling all this off, it’s going to be a tall order.

Many are betting that Pfizer can’t do it, which is why the stock sells for less than eight times earnings and nearly 7% yield. But I think they can easily cover the dividend with their $15 billion in free cash flow. And longer term, Pfizer has enough shots on gold that it can get through this tricky period and come out the other side as it gets more growth. Now, it’s controversial only because it’s done nothing, I think, and I think it can be near a breakout.”

Photo by Spencer Davis on Unsplash

Pfizer Inc. (NYSE:PFE) develops and sells medicines and vaccines, including treatments for heart disease, infections, cancer, immune disorders, and COVID-19.

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Disclosure: None. This article is originally published at Insider Monkey.