...Pfizer (PFE) Financial Analysis for 2012, 2013 and 2014: Ratio Analysis Abstract The following is a list of these ratios, in conjunction with associative details and background to itemize and explicate the overall financial enquiry: Earnings per Share (EPS), which will illustrate current, along with expected, product losses, unfavorable impact and any adverse change in a foreign exchange rate, along with adjustable income attributable to Pfizer and its shareholder's guidance. The next ratio considered would be Profit Margin Ratio, or Net Profit Margin, to characterize the settlement of adjusted income and weakened EPS guidance to reported net income. With the Return on Assets ratio, stakeholders can configure and acquire current, as well as anticipated dividends, all while maintaining sufficient capital to invest successively and increase global shareholder value – which for now, can maintain to support the annual dividend growth, in addition to the accompanied Gross Profit Rate. Together with this, a Return on Common Stockholders’ Equity can be taken into account with regards to commercial and business development opportunities – leading to a direct, shareholder-value enhancement through actual dividends and repurchases. On the other side of the spectrum, Pfizer’s Current and Cash Debt Coverage ratios clarify and expound upon the potential, yet significant, expected adverse events on revenues due to possible loss and expiration of intellectual property and licensing rights...
Words: 1814 - Pages: 8
...Executive Summary: Pfizer-Wyeth Merger Deal Overview: On January 25, 2009, Pfizer and Wyeth entered into the merger agreement, pursuant to which, subject to the terms and conditions set forth in the merger agreement, Wyeth will become a wholly-owned subsidiary of Pfizer. Upon completion of the merger, each share of Wyeth common stock issued and outstanding will be converted into the right to receive, subject to adjustment under limited circumstances, a combination of $33.00 in cash, without interest, and 0.985 of a share of Pfizer common stock in a taxable transaction. Pfizer will not issue more than 19.9% of its outstanding common stock at the acquisition date in connection with the merger. The exchange ratio of 0.985 of a share of Pfizer common stock will be adjusted if the exchange ratio would result in Pfizer issuing in excess of 19.9% of its outstanding common stock as a result of the merger Deal Terms Breakdown: Transaction Value Transaction Consideration Purchase price per WYE share $50.19 Existing Cash Used $22,213 32.7% Cash per WYE share $33.00 New Debt $22,500 33.1% PFE stock value per WYE share $17.19 Total Cash $44,713 65.8% PFE shares per WYE share 0.985 Stock Consideration $23,289 34.2% Premium to 1/23/09 WYE price 29.3% Total Consideration $67,303 100.0% Total WYE shares (MM,diluted) 1,341 Total Equity...
Words: 8308 - Pages: 34
...| Pfizer Stock Report | | Fall 2013 Research Project | | Pfizer Stock Report | | Fall 2013 Research Project | Saint Joseph’s University Contents II. Introduction 2 III. Macroeconomic Review 3 IV. Stock Market Analysis 6 V. Industry Analysis 8 VI. Company Strategic Analysis 10 VII. Company Financial Analysis 12 VIII. Application of Valuation Methodologies 13 IX. Conclusion and Recommendations 15 X. Exhibits 16 A. Exhibit A 17 B. Exhibit A 17 XI. References 18 Introduction Pfizer, headquartered in New York, NY, is committed to applying science and global resources to improve the health and well-being of individuals of all stages of life. Ian Read, CEO, leads the company through innovation and solid long term performances on the NYSE. Pfizer is also on the London, Euronext and Swiss exchanges. They make every effort to provide everybody with access to affordable, top of the line, safe remedies and health related services to those in need. Some of Pfizer’s most famous products include, Lipitor, Lyrica, Diflucan, Zithromax, Viagra, and Celebrex. Pfizer is committed to providing sustainable solutions to the biggest health issues in the world by continuously reviewing and updating their products and services to reduce their environmental footprints. The company maintains the highest ethical standards in all that they do such as sales and marketing to research and development. Pfizer, along with all industry...
Words: 4411 - Pages: 18
...Pfizer’s current ratio in 2011 (up to September 31, 2011) was 2.25. This means that the company has $2.25 in its current assets to pay $1 of it current liabilities. In general, Pfizer is increasing this ratio over the last 4 year from 1.59 in 2008 to 2.25 in 2011. It is also in line with the industry performance. The main reason for this gradual increase is the fact that Pfizer is accumulating current assets of acquired companies. For example, in 2009-2010 Pfizer acquired Wyeth together with Wyeth’s taxes and other Wyeth's current assets totaling to $1.2 billion (Pfizer, 2010). Cash and cash equivalents also increased in 2011 due to the fact that Pfizer needs cash on hands to settle ongoing acquisition of King (Pfizer, 2010). At the same, the time growth in accounts receivables from $14.4 billion to $15.7 was caused by higher sales in 2011 for the same nine month period ($50.6 billion in 2011 vs. $49.7 billion in 2010) Quick ratio In 2011 for nine month period Pfizer had 1.9 quick ratio. This means that for each dollar Pfizer owes, the company has $1.9 in its cash, cash equivalents, marketable securities, and accounts receivables to pay back. Inventory amount is excluded from calculation. In case the company is about to be liquidated or default, inventory cannot be quickly sold to get cash for it. Pfizer is doing very well with respect to the quick ratio. The company is improving it over the period of last four years. The main reason for it is the fact that the company is accumulating...
Words: 1551 - Pages: 7
...one of the following is an advantage of corporations relative to partnerships and sole proprietorships? (Points : 5) Reduced legal liability for investors Harder to transfer ownership Lower taxes Most common form of organization 2. (TCO A) When a corporation distributes a dividend, _____. (Points : 5) the most common form of distribution is a cash dividend the Dividends account will be increased with a credit the Retained Earnings account will be directly increased with a debit the Dividends account will be decreased with a debit 3. (TCOs A, B) Below is a partial list of account balances for Cerner Company: Cash $5,000 Prepaid insurance 500 Accounts receivable 2,500 Accounts payable 2,000 Notes payable 3,000 Common stock 1,000 Dividends 500 Revenues 15,000 Expenses 12,500 What did Cerner Company show as total credits? (Points : 5) $21,500 $21,000 $20,500 $22,000 4. (TCOs B, E) Using accrual accounting, expenses are recorded and reported only _____. (Points : 5) when they are incurred, whether or not cash is paid when they are incurred and paid at the same time if they are paid before they are incurred if they are paid after they are incurred 5. (TCO D) Three companies report the same cost of goods available for sale, but each employs a different inventory costing method. If the price of goods has increased during the period, then the company using _____. (Points : 5) LIFO will have the highest ending inventory FIFO will have the highest...
Words: 2151 - Pages: 9
...Trang Tran, Yinjia Hua, Xiaoyi Zhou, Wei Luo - Group 3 Professor Nina Dorata Business Combinations – ACC 638 (T, 6:55pm-9:20pm) 11 May 2011 Pfizer & Wyeth When Pfizer announced an agreement to buy Wyeth in January 2009, it was expected to not only create a pharmaceutical behemoth which would be the biggest merger since AT&T and BellSouth in March 2006 (according to the research firm Capital IQ but also would be an extraordinary event in such a financial crisis for the period 2008-2009 because this was not a desperate merger of two financial institutions orchestrated by the government. Moreover, since after 12/15/2008, a new accounting standard that requires acquisition method for business combinations has been taken into effect. Therefore, the acquisition of Pfizer and Wyeth has been one of the most interesting deals recently. Although credit was tight that time because of the financial turmoil, Pfizer borrowed about $22.5 billion from five banks to cover the Wyeth purchase; the remainder was financed through a combination of cash and stock. The deal closed in October 15, 2009. At that time, the whole Wyeth outstanding common stock was about 1,339.6 million; the closing price of Pfizer stock was $17.66; Wyeth stock option canceled was about $405 million and Wyeth restricted stock canceled was about $320 million. Accordingly, the total purchase is $68,236 (Appendix A). Other related accounting and consulting costs was recorded as expense at the acquisition date. Because...
Words: 1243 - Pages: 5
...Pfizer Executive Summary Company Overview World’s largest global research-based biomedical and pharmaceutical company that discovers, develops, manufactures and markets safe and effective medicines. Mission To be the world’s most valued company to patients, customers, colleagues, investors, business partners and the communities where we work and live. Pharmaceutical Products Aricept Genotropin Spiriva Aromasin Geodon/Zeldox Sutent Caduet Lipitor Vfend Camptosar Lyrica Viagra Celebrex Norvasc Xalatan/Xalacom Chantix Rebif Zmax Detrol/Detrol LA Relpax Zoloft Eraxis Revatio Zyvox Animal Health Products BoviShield Draxxin RespiSure/Stellamune Cerenia Excede Revolution/Stronghold Clavamox/Synulox Improvac Rimadyl Convenia Lutalyse Silentrol Dectomax Naxcel/Excenel Financials Stock Symbol: PFE Price Range: $11-$18 Sales (2008): $48,296,000,000 Net Income: $8,104,000,000 Net Assets: $109,892,000,000 Key Executives CEO: Jeff Kindler CFO: Frank D'Amelio CMO (Chief Medical Officer): Freda C. Lewis-Hall Key Competitors GlaxoSmithKline Johnson & Johnson Novartis AG Roche Holding-AG Sanofi-Aventis Mergers and Acquisitions (2008-2009) Wyeth: announcement of merger 1/26/09, biopharmaceutical Auxilium Pharmaceuticals: 12/08, develops Xiaflex-first in class biologic for treatment of Dupuytren’s contracture and Peyronie’s Disease Schering-Plough...
Words: 7035 - Pages: 29
... Merck’s Business Environment There are many factors a business, such as Merck, must have in order to be successful, for example strong financial statements, leading technology, and globalization. With the help of income statements, balance sheets, and cash flow statements, a financial analysis can be applied in a wide variety of situations to give business managers the information they need to make critical decisions (Financial Analysis, 2010). They also provide information in regards to the financial health of a company. Pharmaceutical companies are using technology to conduct clinical trials, which has proven to be beneficial to research, development, and the introduction of new products. Globalization is also important for Merck when it comes to product distribution. Outsourcing was been adopted by Merck in order to produce equal quality vaccines and medications at a cheaper cost. Review of Finances Analyzing a company’s income statement, balance sheet, and cash flow is a prime way in determining their success. A comparison can be made between the competition in the industry and a leader can be established. An analysis can also show which company is spending more on research and development and in turn, producing better products. After review of the income statements, Merck’s worldwide sales were $12 billion for the third quarter this year, an increase of 8 percent compared with the third quarter of 2010 (Newsroom, 2010). This...
Words: 2950 - Pages: 12
...Course Project: Pfizer Inc. Fall 2010, F203A: Financial Accounting for Management Group 8 Heejun Chung Serge Sidorov Tim Harvey Brett Neu Ed Wu 1. Table of Figures Exhibit 1 in the Appendix contains a table of figures that is comprised of data pertinent to Pfizer’s financial performance in 2007 – 2009. 2. Common Size Balance Sheet Analysis a. Common size balance sheets for Pfizer and Novartis in 2007 – 2009 are shown in Appendix (Exhibit 2). b. Analysis * Items on the balance sheet decreased slightly between 2007 and 2008, but increased by almost 50% between 2008 and 2009. This is attributable to the acquisition of Wyeth (the deal was announced on January 25 and completed on October 15, 2009). This major event is reflected in almost all entries of the balance sheet: between 2008 and 2009 “Total Current Assets” increased by 43%, “Property, Plant and Equipment” increased by 71%,”Goodwill” almost doubled (97%), and “Other Noncurrent Assets” went up by 158%. “Total Assets” increased almost twofold (92%). * Together with the assets the liabilities also increased: “Long Term Debt” went up by 442% (apparently Wyeth had a lot of debt prior to the merger), whereas “Deferred Tax Liabilities” increased by 503% (apparently Wyeth had older assets). Total liabilities to total assets ratio increased from 48% to 57%. Total equity increased by 57%. The absolute value of “Treasury Stock” decreased by 63%. This may be due to the fact...
Words: 2136 - Pages: 9
...Management Mehmet F. Celik Dr. Bliss: Corporate Investment Analysis, Fin 550 Strayer University 1. |Investment Category |Rate of Return |Rate of Inflation |Real Rate of Return | | | | |(Rate of Return - Rate of inflation) | |U.S. Government T-Bills |3.5% |2.9% |0.6 % | |Large-cap Common Stocks |12.1% |2.9% |9.2% | |Long-term Corporate Bonds |6.2% |2.9% |3.3% | |Long-term Government Bonds |5.6% |2.9% |2.7% | |Small -capitalization Common Stock |14.6% |2.9% |11.7% | In terms of Real Rate of Return Small – cap Common Stocks still have the best value that it seems to us. However, if inflation continues to go up, I would prefer Large-cap Common Stocks instead of Small-cap Common Stocks. 2. |Month |Nike...
Words: 438 - Pages: 2
...of drugs to meet a growing global demand while maintaining quality to ensure safety. • Global and local regulatory agencies around the world have a daunting task to monitor manufacturers, raw material suppliers, and stem counterfeit pharmaceutical production. • Wholesale distributors, importers, and retail pharmacies have a large amount of power in the supply chain as they pull the demand from the manufacturers and provide the medicines to end-consumers. • In a changing industry where there are fewer blockbuster drugs and increasing use of generic offerings, manufacturers as well as participants at all levels of the supply chain must look for areas to improve efficiencies to be profitable in the long-run. Pharmaceutical Supply Chain Analysis 2 Introduction A transparent and efficient pharmaceutical supply chain contributes significantly towards improving the availability of essential medications. The reality across the world is that pharmaceutical supply and distribution consists of different stakeholders from both the public and private sectors to create complex systems. In a heavily regulated field, globalization has placed increasing demands on regulatory agencies to ensure the safety and effectiveness of drugs marketed. The pharmaceutical industry has increasingly relied on global supply chains where manufacturing is often outsourced to foreign factories. Some agencies, such as the FDA, may conduct inspections off offshore manufacturing facilities. However, the complexity...
Words: 6177 - Pages: 25
...Pfizer: Ethics and Leadership The selection process used by Pfizer to find a successor to CEO William Steere, who had lead the company to the top of the pharmaceutical industry, lacked a system of checks and balances resulting in a power struggle that ultimately led to distrust and the unraveling of Pfizer’s top brass by an outsider . The power struggle that erupted within Pfizer demonstrates how ethical breaches occur under specific conditions and the resulting damage. It is fascinating to observe how the unethical actions of a few individuals can spiral through an entire organization negatively affecting both the companies and their stakeholders. An economic analysis of Pfizer highlights the mismanagement of resources and the ensuing social and financial costs. Pfizer was founded in 1849 by Charles Pfizer and Charles Erhart as a fine chemicals business in Brooklyn New York. In the 1950’s the company changed its focus from fine chemicals into a research based pharmaceutical company. Pfizer’s growth exploded in the 1980’s and 1990’s with the success of drugs like Lipitor and Viagra. Led by William Steere and fueled by profits from Lipitor, Pfizer was entering its glory years. Under Steere Pfizer stock rose to a record high of $49 a share. When Steere took control in 1991 his emphasis for Pfizer was research and development of pharmaceuticals. Pfizer became a benchmark in the pharmaceutical industry and “was ranked among America’s best managed and most admired companies...
Words: 2173 - Pages: 9
...Question 1 For 4 Dow Jones stocks for a 15 year period, compute quarterly realized betas from daily data. Find firm specific and macroeconomic variables that help explain quarterly beta. Answer 1.1 Factors Introduction Factor model survey the sensitivity of a stock return as a function of one or more factors. There are single-factor and multi-factor models. In factors model, based on the type of factors used, it can be classified to economic and fundamental factor models. Economic factor models use macroeconomic and financial markets variables as factors, while fundamental factor models use firm-specific microeconomic variables, such as financial indicators. In recent research shows that the change in macroeconomic factors could be reflected in the change of systematic risk which impacts a stock’s expected return (Humpe & Macmillan 2007). Macroeconomic factors included industry production index, CPI, GDP, unemployment rate, inflation rate, risk premium, default premium, business cycle index and so on. From Chen (1986) notable study which uses variables include industrial production, inflation, risk premium, term structure, market index, consumption and oil prices to found out that industrial production, unanticipated change in the risk premium, unanticipated inflation, and, a slightly weaker, the unanticipated change in term structure, are the most important factors affecting expected stock returns. The 15 macroeconomic variables used as factors in our model are...
Words: 7464 - Pages: 30
... |EPS 2007: $3.67 | |Beta: 0.752 |EPS 2008 (E): $4.15 | |52 Week High: $57.52 |EPS 2009 (E): $3.86 | |52 Week Low: $28.62 | | [pic] Executive Summary As analysts we were called upon to enact our due diligence in dealing with the proposed purchase of Eli Lilly common stock. We performed various analyses, which included strategy analysis, fundamental analysis, valuation, and risk assessment. Our absolute valuation calculation shows that Eli Lilly is slightly undervalued however; our relative valuation calculation shows that Eli Lilly is fairly valued. We decided to use the relative valuation recommendation because of the risk that is involved in the industry today. Current risk factors that are threatening Eli Lilly are the FDA approval process, patent expirations, pipeline concerns, the purchase of Imclone and how it will be integrated into the company, and finally the ongoing recession. Eli Lilly currently has drugs pending FDA approval, notably Effient, a...
Words: 8055 - Pages: 33
...pharmaceuticals company centered in Clinton, New Jersey. Today, the company as a whole focuses primarily on developing medicines to fight cancer, hepatitis, HIV/AIDS, and diabetes, but the beginnings years of the company had an extremely different outlook. It took nearly fifteen years before the company started turning a profit, but ever since the turn of the century in 1900, BMS has been able to stay in the black. The company’s first two successful products was the first toothpaste to include a disinfectant called Ipana, and a laxative mineral salt called Sal Hepatica. By 1924, the company had gone international and profited a million dollars for the first time. Bristol Myers Squibb was also able to issue stock for the first time in 1929, as it was traded on the New York Stock Exchange. Throughout the 1960’s and 1970’s, the company was able to expand into the baby formula and antibiotics market, as well as creating the first electronic toothbrush. In 2001, the company was voted the “Most Admired Pharmaceutical Company” by Fortune Magazine, and today the company has continued its progression into the fields of oncology and antibiotics. Bristol Myers Squibb continues to set high standards for itself and the pharmaceutical industry as a whole, as they have announced several partnerships to develop breakthrough treatments for diabetes, heart disease, HIV, Alzheimer’s, and many different fields within oncology. To date, Bristol Myers Squibb has several consumer health products sold...
Words: 2280 - Pages: 10
