J.P. Morgan: Pfizer beats third-quarter expectations, but long-term view still depends on new-drug pipeline

What stood out in third-quarter results and full-year guidance?

Pfizer reported third-quarter 2026 revenue of 16.583 billion dollars, beating expectations overall by 733 million dollars, with most core products performing better than expected. Earnings per share were 0.87 dollars, exceeding the market consensus by 0.14 dollars.
The company raised its 2026 revenue guidance by 1.5 billion dollars to 62 billion–64 billion dollars. Its earnings-per-share guidance rose to 2.95–3.05 dollars, with the midpoint 0.10 dollars higher than before, in line with JPMorgan's expectations.
JPMorgan raised its full-year revenue forecast from 63.283 billion dollars to 63.806 billion dollars and its earnings-per-share forecast from 3.02 dollars to 3.05 dollars, both at the high end of the company's guidance ranges.

JPMorgan modestly raised its revenue forecasts for 2027 and beyond: higher expectations for Padcev, Nurtec and Vyndamax were partly offset by lower forecasts for Prevnar and other non-core products or products affected by loss of exclusivity.
Despite the upward revisions, the bank still expects revenue to fall from 63.806 billion dollars in 2026 to 59.898 billion dollars in 2027 and 51.921 billion dollars in 2028. Adjusted earnings per share are expected to be 3.05, 2.87 and 2.09 dollars, respectively. The recent improvement in performance has not changed the decline in revenue and earnings over the next two years in its model.

JPMorgan is focused on CDK4 and KAT-6 in breast cancer, VEGFxPD1 for multiple oncology indications, the obesity drug berobenatide, and a trispecific drug for atopic dermatitis, asthma and chronic obstructive pulmonary disease. The bank believes most of these core programs will not produce important data until the end of 2027 or 2028.
Nearer-term milestones include an early trial of an amylin drug; the bank expects limited details to be disclosed in the near term and considers the phase IIb data in 2027 more meaningful. The company also expects the first phase III data for mevrometostat in the first quarter of 2027, later than its previous expectation of the fourth quarter of 2026. JPMorgan expects positive results but believes they will have a limited effect on the overall investment thesis for Pfizer.

The bank believes Pfizer's valuation of about 10.5 times expected 2027 earnings per share is not high and that its new-drug pipeline has potential, but more data is needed to reduce uncertainty around the programs before investor sentiment can potentially change.
JPMorgan maintains its Neutral rating and 30 dollar price target for December 2027. The target uses a discounted cash flow method, assuming a perpetual growth rate of 0% and a weighted average cost of capital of 8.5%; the ability to maintain margins and pipeline progress are important variables affecting the rating and price target.