Just as I predicted, Pfizer drops like a rock.
On March 17 I wrote an article for the Swedish business daily, Realtid, with the headline "Pfizer stock will tumble."
Today PFE stock did tumble. If shareholders listened to my comments, including the ones I made about failed Exubera way before anyone on Wall Street woke up they'd have saved a bundle. And if Pfizer would have cared to have listened to me maybe they'd have saved a bundle too, rather than taking billion dollar charges for failed products. At least some investment banks and hedge funds are taking notice and are, indeed, listening. I told those guys what was coming in January.
So anyway, Pfizer Inc. today tumbled to its lowest price per share in more than a decade in New York trading after it missed analysts' estimates in reporting that profit plunged 18 percent.
"Unless Kindler's plan is to tank revenue, I would say his plan is not working,'' said Les Funtleyder, an analyst with Miller Tabak & Co. in New York, in a telephone interview today. "There has been a lot of dissatisfaction from shareholders that they haven't been more aggressive. I think this announcement will only raise the din of investment concern.''
First-quarter net income declined to $2.8 billion, or 41 cents a share, the New York-based company said today in a statement. Revenue fell 5 percent to $11.8 billion as a boost from currency exchange rates failed to overcome a combined $777 million drop in sales for its cholesterol pill Lipitor and blood pressure drug Norvasc, both facing generic competition. Profit excluding some items missed analysts' estimates by 5 cents.
The company doesn't have enough products in development to replace those going off patent within four years, including Lipitor, which accounts for about 40 percent of profits, analysts said. Pfizer Chief Executive Officer Jeffrey Kindler has tried to keep earnings up by cutting as much as $2 billion in costs and squeezing more revenue out of existing products.
Pfizer fell 81 cents, or 3.8 percent, to $20.29, at 9:37 a.m. in New York Stock Exchange composite trading, after declining 22 percent in the 12 months before today. The last time the stock price was lower was Sept. 30, 1997, when it hit $20.04. The drop is the biggest since Dec. 4, 2006.