Pfizer and Moderna stocks Analyzes stock price movements over the past 5 years (using stock price related ratios) I Pfizer 1 OverviewIntroduction Name Pfizer Inc Ticker symbol PFE Exchange NYSE Indus.
Pfizer and Moderna stocks: Analyzes stock price movements over the past years (using stock price related ratios) I Pfizer Overview/Introduction - Name: Pfizer Inc - Ticker symbol: PFE - Exchange: NYSE - Industry: Pharmaceuticals - Market cap: $264.1B - Headquarters: 235 East 42nd Street, New York City, U.S - Founded: 1849 in New York City - Founders: Charles Pfizer Charles F Erhart - Logo: - Purpose: Breakthroughs that change patients’ lives Value: Courage, Excellence, Equity, Joy - Their bold moves: Unleash the power of our people Deliver first-in-class science Transform our go-to-market model Win the digital race in pharma Lead the conversation Their big ideas: Source the best science in the world - - Double our innovation success rate Enhance health outcomes and patient experience Digitize drug discovery and development Focus the narrative on the value of our science Operating range: Over 55 countries worldwide The two largest foreign markets are China and Japan Pfizer Inc is an American multinational pharmaceutical and biotechnology corporation headquartered on 42nd Street in Manhattan, New York City The company was established in 1849 in New York by two German entrepreneurs, Charles Pfizer (1824–1906) and his cousin Charles F Erhart (1821–1891) Pfizer develops and produces medicines and vaccines for immunology, oncology, cardiology, endocrinology, and neurology The company has several blockbuster drugs or products that each generate more than US$1 billion in annual revenues In 2020, 52% of the company's revenues came from the United States, 6% came from each of China and Japan, and 36% came from other countries In addition, the company is involved in the contract manufacturing business It serves wholesalers, retailers, hospitals, clinics, government agencies, pharmacies, and individual provider offices, as well as disease control and prevention centers The company has collaboration agreements with Bristol-Myers Squibb Company; Astellas Pharma US, Inc.; Myovant Sciences Ltd, Pfizer was a component of the Dow Jones Industrial Average stock market index from 2004 to August 2020 The company ranks 64th on the Fortune 500 and 49th on the Forbes Global 2000 During the COVID-19 era, Pfizer was one of the world's largest ordered vaccine brands due to its high effectiveness against covid-19 (~95%), although it does not accept commercialization.l cost Thanks to the sale of the vaccine, Pfizer has enjoyed a sudden growth in revenue as well as attracting investment that has caused the share price to increase significantly Estimated revenue from Covid-19 vaccine Pfizer accounts for about 42% of the company's total revenue Analysis 2018 2019 2020 2021 2022 P/E 22.23 12.93 23,3 15.34 8.41 P/B 3.73 3.254 3.24 4.299 2.65 EPS ($) 1.89 2.92 1.60 3.91 5.2 ROE (%) 16,12 25.86 14,27 30,97 35.86 ROA (%) 6,73 9,9 5,42 13,03 15.92 Current ratio 1.567 0.8793 1.353 1.399 1.589 Quick ratio 1.33 0.69 1.04 1.19 1.37 Debt - to equity ratio 0.6584 0.8052 0.6052 0.4792 0.3852 2022 : lấy số liệu đến ngày 30/09/2022 2018-2021: số liệu 31/12 *Phân tích số - EPS = Net income - Preferred stocks / Total shares outstanding EPS ($) 2018 2019 2020 2021 2022 1.89 2.92 1.60 3.91 5.31 EPS indicates how much money a company makes for each share of its stock and is a widely used metric for estimating corporate value This is considered a part of the profit earned on each initial investment, so it is considered an indicator of the profitability of a company or an investment project EPS is used to compare the performance of businesses with each other EPS is also one of the important components to be able to create the P/E ratio, also known as the price-to-earnings ratio.Accordingly, in the P/E ratio, E is EPS At the same time, the ratio (P/E) is also one of the extremely important indicators to be able to conduct analysis and make decisions in the stock investment of any investor today Pfizer's EPS fluctuates quite a lot from year to year In 2018, Pfizer’s EPS got $1.89, however in 2019, it had slightly soared to $2.92 because net income in 2019 is higher ($15,950B) and Pfizer 2019 shares outstanding were 5.675B, a 5.05% decline from 2018 Moreover, in 2020 Pfizer EPS had suddenly dropped at 1.60 The reason why it’d been dropped was that net income in 2020 had decreased $9.159B compared to 2019 and Pfizer 2020 shares outstanding were 5.632B, a 0.76% decline from 2019 In the next years, this ratio rises gradually ; EPS in 2022 is the highest that demonstrates Each share of Company Pfizer has a profit of about 5.31 USD - P/E = Market value per share / Earnings per share The price-to-earnings ratio (P/E) is one of the most widely used tools by which investors and analysts determine a stock's relative valuation The price-to-earnings (P/E) ratio relates a company's share price to its earnings per share P/E ratios are used by investors and analysts to determine the relative value of a company's shares in an apples-to-apples comparison A high P/E ratio could mean that a company's stock is overvalued, or that investors are expecting high growth rates in the future Companies that have no earnings or that are losing money not have a P/E ratio because there is nothing to put in the denominator The price-to-earnings ratio indicates the dollar amount an investor can expect to invest in a company in order to receive $1 of that company’s earnings P/E 2018 2019 2020 2021 2022 22.23 12.93 23.3 15.34 8.41 The ratio (P/E) is one of the important indicators in analyzing and making investment decisions of investors The E in the P/E ratio is EPS The calculation formula is: P/E = Market price/ EPS EPS and P/E have a negative relationship with each other Looking at a table, P/E in 2018 is 22.23, which means investors are willing to pay $22.23 for $1 of current earnings Although stock price in 2019 is lower than in 2018, EPS in 2019 higher than in 2018 at $1.03, this reason makes P/E in 2019 dropped at 12.93 The highest P/E of Pfizer over the past years is 23.3 in 2020 The reason is because EPS in 2020 reaches the minimum value of 1.6 After 2020, P/E ratio of Pfizer has gradually gone down reaching 15.34 and 8.41, respectively in 2021 and 2022 - P/B = Market Price per share / Book value per share P/B 2018 2019 2020 2021 2022 3.73 3.254 3.24 4.299 2.65 Companies use the price-to-book ratio (P/B ratio) to compare a firm's market capitalization to its book value The price-to-book ratio is often used by value investors looking for stocks that are underpriced by the market The price-to-book ratio is used by value investors to identify potential investments, through this coefficient, investors will judge whether the current stock price is undervalued or higher than its true value The P/B ratio also indicates whether you're paying too much for what would remain if the company went bankrupt immediately The P/B ratio provides a valuable reality check for investors seeking growth at a reasonable price and is often looked at in conjunction with return on equity (ROE), a reliable growth indicator Over the past years, the P/B ratios of Pfizer Inc have been higher than 1, which means that the market has high expectations for Pfizer company Investors believe that the business will well and develop in the future They are willing to pay more than the book value of the shares to be able to own them Pfizer's P/B ratio over the past years has not differed too much In 2018-2020, the index doesn’t change significantly, attaining 3.73, 3.254 and 3.24 respectively The highest P/B ratio of Pfizer Inc is 4.299 in 2021, so to own PFE shares, investors accept to pay 4.299 times the book value In 2022, the P/B ratio drops by 1.649 - the lowest number in years - ROE = Net income / Average Shareholder’s equity https://phantichtaichinh.com/roe-la-gi/ ROE 2018 2019 2020 2021 2022 16.12 25.86 14.27 30.97 37.33 ROE is considered a gauge of a corporation's profitability and how efficient it is in generating profits The higher the ROE, the more efficient a company's management is at generating income and growth from its equity financing ROE shows how much profit a company's equity generates If this ratio has a positive value, the enterprise is profitable; If the value is negative, the business is making a loss This ratio depends on the business season In addition, it also depends on the size and level of risk of the Enterprise As we can see, 2018-2022, ROE ratio is positive, so we can conclude the Pfizer company is profitable In 2018-2020, indicators fluctuate unevenly showing that The company uses capital inefficiently, does not earn more profit On the other hand, after 2020, ROE increases year-by-year , 2021 increased 16.7% and 2022 increased 23.06% when compared to 2020 A high and increasing ROE every year reflects: → Enterprises are using and managing capital effectively → The business is in a good stage of development, reflecting strong growth potential → The enterprise has a harmonious balance between shareholders' equity and debt (because if it is not balanced, a lot of debt will have to pay interest, which will reduce the profit of the Company) - ROA = Net income / Total assets ROA - - - 2018 2019 2020 2021 2022 6.73 9.9 5.42 13.03 15.92 ROA, also known as return on assets, is a financial metric that tells you how much profit a company makes relative to the value of its assets The higher the ROA, the better the company's capital efficiency This index is extremely important in choosing good stocks Because businesses that operate effectively in the long run always bring great value to shareholders Pfizer's ROA fluctuates up and down and is unstable between 2018 and 2022, showing that the company has not used its assets effectively and optimally with available resources The highest ROA in 2022 is 15.92 (%) and the lowest is 5.42 (%) at the end of 2020 From 2018 to 2020, ROA fluctuated at 6.73 in 2018 and increased to 9.9 in 2019, after that halves to 5.42 in 2020 Current ratio = Current assets/ Current liabilities Current ratio 2018 2019 2020 2021 2022 1.567 0.8793 1.353 1.399 1.589 Current ratio is a ratio of short-term debt solvency, used to measure the ability of a business to pay short-term debts The current ratio shows how many dollars of current assets and short-term investments a business has to secure a dollar of short-term debt The higher the short-term ratio, the more reliable the company's solvency, and vice versa, the lower the ratio, the more difficult it is to trust the solvency The generally accepted short-term payout ratio is approximately 2.0 Based on the line chart, it can be seen that in years Pfizer's current ratio has a slight fluctuation Most ratios are greater than 1, a high current ratio, which means the company's current assets are sufficient to pay off its current liabilities In 2018, the index was at 1,567 and fell sharply the next year to 0.8793 However, in the next three years, the quick ratio of the company tends to increase again to reach 1,353 in 2020 and slightly increase to 1,399 and 1,589 in the following years - Quick ratio = (Current assets - Inventory) / Current liabilities Quick ratio - - 2018 2019 2020 2021 2022 1.33 0.69 1.04 1.19 1.37 The quick ratio is an indicator of a company’s short-term liquidity position and measures a company’s ability to meet its short-term obligations with its most liquid assets The higher the quick ratio, the higher the solvency of the business, and vice versa, the lower the ratio, the harder it is to trust the fast payment ability of the payment enterprise Typically, the quick ratio accepted is approximately From the data table, we can see that most of the company's quick ratio is greater than Only in 2019, Pfizer's quick ratio was less than 1, at 0.69 It means that the company may not be able to pay off its short-term debts, whereas in other years, the company has a quick ratio greater than one, which implies that the company can pay off the short-term debts immediately 2020, Pfizer's net income was $9,159 billion, but by 2021 it had increased dramatically to 21.98 billion, and until now, Pfizer's net income has reached $26,378 billion (September 30, 2022) Besides, in 2021 and 2022, total assets and stockholders' equity will also increase, leading to an increase in ROE and ROA for Pfizer Moreover, we can see that in the past years, ROE has always been higher than ROA, proving that corporate financial leverage has a positive impact Pfizer Inc always maintains a ROE >=15% for years, so the company is considered an efficient business In addition, over a 5-year period, almost all of Pfizer's quick ratio and current ratio were greater than 1, which is a positive for the company because it shows it has enough liquidity to pay short-term debt However, only in 2019, both the quick and current ratios of Pfizer were less than 1, which explains the fact that in 2019, the company's (current assets - inventory) (25.74B) decreased less than the current liabilities (37.30B) of the company Therefore, the quick ratio is only 0.69 Similarly, the current ratio is only 0.88 because current liabilities (37.80 billion) are greater than current assets (32.30 billion) by approximately billion In conclusion, Pfizer is worth investing in for investors who adopt a value investing approach based on aspects: industry trend, business strategy, financial performance, valuation, and the epidemic Pfizer should be able to gain benefit in the future with the support of industry growth led by several favorable factors The company is expected to grow further with its strong focus on innovative drug research and development, along with its transformation plan which makes it stand out from the crowd Besides, the rise of new coronavirus strains will sustain the demand for Covid-19 vaccines due to the possibility for third-dose booster shots and more countries will approve the emergence use of Pfizer’s vaccine for the population below 18 Pfizer, as the most popular Covid-19 vaccine used by most countries, the sustained demand will benefit their growth of revenue And Pfizer's strong cash flow will also further invest in the drug pipeline, thus forming a good ecological cycle system From the other perspective, Pfizer’s EPS is expected to increase sharply, which is very attractive Besides, Pfizer’s beta is 0.74, which is lower than 1, meaning the PFE stock is less volatile than the market Thus, it will be a great target stock in the market, which is trading near all-time highs As a result, with positive financial performance and effective business strategies, this is a good quality undervalued stock with a great future prospect II Moderna Overview/Introduction - Name: Moderna Incorporated - Ticker: MRNA - Exchange: NASDAQ - Market cap: 61.3B - Headquarters: 200 Technology Square Cambridge, Massachusetts, USA - Founded: September, 2010 - Founders: Derrick Rossi Timothy A Springer Robert S Langer Kenneth R Chien Noubar Afeyan Logo: History: Moderna Incorporated is an American pharmaceutical and biotechnology company As of 2022, the company has 44 treatment and vaccine candidates, of which 21 have entered clinical trials The company's only commercial product is the Moderna COVID-19 vaccine, marketed as Spikevax, which makes Moderna become a "giant" in the pharmaceutical industry, known around the world for groundbreaking research that has the potential to change medicine Since our founding in 2010, Moderna Inc have been through important moments and worked hard to build the industry's leading mRNA technology platform: 2010: Moderna incorporates Moderna’s name combines the words "modified" and "RNA", which happens to contain the word "modern.” 2011: Operations started Moderna begins research into the production of mRNA medicines 2014: Expansion New headquarters and labs open in Cambridge, Massachusetts 2015: First human dose of flu vaccine Moderna successfully invents and adopts the first-in-human dose of an mRNA vaccine (mRNA-1440), an H10N8 flu vaccine candidate 2017: First human dose of multivalent vaccine Moderna initiates first-in-human dosing for mRNA-1653, a combination vaccine with the potential to protect against more than one disease – human metapneumovirus (hMPV virus) and parainfluenza virus 2019: First antibody encoded by mRNA Moderna announces dosing of the first antibody encoded by mRNA in a clinical trial 2022: Moderna receives full approval for COVID-19 vaccine by U.S FDA The U.S The Food and Drug Administration (FDA) approved the Biologics License Application (BLA) for SPIKE VAX (COVID-19 Vaccine, mRNA) to prevent COVID-19 in individuals 18 years of age and older in the U.S Analysis https://companiesmarketcap.com/moderna/eps/ https://www.readyratios.com/sec/MRNA_moderna-inc https://www.forbes.com/companies/moderna/?sh=283937d55954 https://www.macrotrends.net/stocks/charts/MRNA/moderna/net-income 2018 2019 2020 2021 2022 P/E -12 -12.6 -53.9 8.98 4.28 EPS ($) -1.274 -1.55 -1.94 28.29 27.64 P/B 3.281 5.603 16.27 7.236 2.54 ROA (%) -81.35 -30.82 -17.03 65.57 45.09 ROE (%) -104.31 -39.45 -30.15 140.21 70.03 Current ratio 7.02 7.89 1.44 1.76 2.10 Quick ratio 6.89 7.75 1.37 1.52 1.80 Debt to equity ratio 0.028 0.033 0.052 0.054 0.051 2022: số liệu đến ngày 30/9/2022 P/E = Market value per share / Earnings per share P/E 2018 2019 2020 2021 2022 -12 -12.6 -53.9 8.98 4.28 P/E of Moderna showed a considerable downward trend from 2018 to 2020, respectively -12, -12.6, and -53.9, which means the company has negative earnings or is losing money, leading to the decrease in the investment of investors This is because during the period, Moderna’s EPS was in minus and also decreased However, under the use of Moderna’s vaccine during Covid-19 pandemic (Moderna’s coronavirus vaccine was granted emergency authorization for people 18 and older in the United States in December/2020), in 2021, this figure peaked at the highest point of 8.98 and it dropped to roughly double in 2022 EPS = Net income - Preferred stocks/ Total shares outstanding EPS ($) 2018 2019 2020 2021 2022 -1.274 -1.55 -1.94 28.29 27.64 As can be seen, Moderna’s EPS shows a stable decrease from 2018 to 2020, before experiencing a significant upward trend during the next few years In 2018, this figure was -1.274, and then it decreased to -1.55 in 2019 This is because net income was -$0.514B, a 27.91% increase from 2018 and Moderna’s shares outstanding was 0.33B, a 1.75% increase from 2018 Similarly, in the next year, Moderna’s ESP showed a stable drop to -1.94 because the shares outstanding was 0.39B (increase 18.63%) and the net income reached -$0.747B, a 45.33% increase from 2019 However, in later years, this figure experienced a significant rise and peaked at the highest point of 28.29 in 2021 and dropped slightly to 27.64 in 2022 with net income of $1.043B, a 68.71% decline year-over-year P/B = Market Price per share / Book value per share P/B 2018 2019 2020 2021 2022 3.281 5.603 16.27 7.236 2.54 Over the past years, the P/B ratios of Moderna Inc have been higher than 1, which means that the market has high expectations for Moderna company, and investors have been willing to pay more than the book values of the shares to be able to own them It can be seen that from 2018 to 2020, this figure experienced a considerable upward trend and peaked at 16.27 in 2020, which means that investors accept to pay 16.27 times the book value to own the shares of this company However, in the next years, this figure dropped respectively 7.236 and 2.54 - the lowest number in years ROA = Net income/Total assets ROA (%) 2018 2019 2020 2021 2022 -81.35 -30.82 -17.03 65.57 45.09 The line graph showed that Moderna’s ROA had a stable increase during the period of years From 2018 to 2020, because of the negative income, this figure was in minus and reached to -81.35, -30.82, and -17.03 respectively However, in the next year, Moderna’s ROA experienced a significant increase and peaked at the highest point of 65.57, before decreasing to 45.09 in 2022 ROE = Net income / Average Shareholder’s equity ROE (%) 2018 2019 2020 2021 2022 -104.31 -39.45 -30.15 140.21 70.03 As can be seen, Moderna’s ROE has experienced a steady upward trend during the 5-year period In the first three years, this figure was in minus and increased to 104.31, -39.45, and -30.15 respectively This is because in these years, net income of this company was under However, in the later years, this figure showed a considerable rise and peaked at the highest point of 140.21 in 2021, and then it dropped double in 2022 Comparison ROA and ROE: ROA = Net income / Total assets ROE = (Net income / Total assets) x (Total assets / Total equity) = (Net income / Total assets) x (1 + (Total debt / Total equity)) (billion dollars ) 2018 2019 2020 2021 2022 Net income -0.4 -0.514 -0.747 12.202 1.043 Total assets 1.96 1.59 7.34 24.67 26.06 Total equity 1.53 1.18 2.56 14.15 17.99 Total debt 0.43 0.41 4.78 10.52 8.07 As can be seen in the data, from 2018 to 2020, the ROA was always higher than ROE, and all ROA and ROE were negative This is because net income of the company was negative and total assets were higher than total equity during this surveyed period In contrast, in the later years, the ROA was less than the ROE because the total assets were higher than total equity and the net income increased during this time Moreover, during the 5-year period, the total assets of the company increased steadily, the total equity had the same trend and was always higher than total debt, except 2020 (the total debt was almost twofold total equity) As a result, it showed the good ability of the Moderna company in using the assets and the equity to generate the profit and managing the debt received effectively Current ratio = Current assets/ Current liabilities Current ratio 2018 2019 2020 2021 2022 7.02 7.89 1.44 1.76 2.10 It can be seen that during the 5-year period, the current ratio of Moderna company experienced a slight fluctuation From 2018 to 2019, this figure had a stable increase from 7.02 to 7.89, before peaking at 17.30 on 30 June 2020 However, this figure showed a significant decrease to 1.44 at the end of 2020, before recovering to 1.76 in 2021 and 2.10 in 2022 This is because from 2020, the total of current assets went up higher than that of current liabilities These figures are higher than 1, which means the effectiveness of Moderna's ability to pay short-term obligations or those due within one year Quick ratio = (Current assets - Inventory) / Current liabilities Quick ratio 2018 2019 2020 2021 2022 6.89 7.75 1.37 1.52 1.80