Tel Aviv. Night view from Jaffa

Pfizer Trades Flat Amid Possible New COVID-19 Vaccine Deal with Israel

Shares in Pfizer Inc. (PFE) traded mostly unchanged Monday after the biopharmaceutical giant said it was in negotiations with Israel to supply additional COVID-19 vaccines. The discussions come five months after the drug manufacturer struck an initial deal to supply the Middle Eastern country with 8 million doses of its double-shot COVID-19 vaccine for a reported $785 million.

Israel, which currently leads the world in per-capita vaccinations, wants to secure an additional 36 million doses of the Pfizer/BioNTech vaccine. Officials say they hope to administer the extra vaccines to teenagers in the coming months and require further supplies to provide booster jabs.

“Pfizer has completed all deliveries to Israel under its initial agreement to provide its COVID-19 vaccine, signed in November 2020,” the company said in a statement cited by Barron’s. “The company is currently working with the Israeli government to update the agreement, to supply additional vaccines to the country.”

Through Monday’s close, Pfizer stock has a market value topping $200 billion and offers a healthy 4.3% dividend yield. Performance-wise, the shares trade slightly lower since the start of the year but have gained around 8% over the past year. From a valuation standpoint, the stock trades at 11.38 times projected earnings, just below its five-year average earnings multiple of 13 times.

Wall Street View

SVB Leerink analyst Geoffrey Porges lowered the investment firm’s price target on the stock to $39 from $40. However, he maintained his ‘Market Perform’ recommendation. Porges now sees full-year earnings coming in at $2.47 per share, a penny below his previous forecast of $2.46.

Most other analysts on Wall Street also have a “wait and see” approach to Pfizer. It currently receives 15 ‘Neutral’ ratings, 1 ‘Overweight’ rating, and 6 ‘Buy’ ratings. Monday’s $36.28 close represents a 7.5% premium to analysts’ 12-month median price target of $39.

Technical Outlook and Trading Tactics

Pfizer shares have remained in a steady uptrend since breaking above a multi-month trendline in early March. More recently, the price has consolidated within a pennant above the 200-day simple moving average (SMA). This indicates a continuation of the bullish momentum. Furthermore, the relative strength index (RSI) sits under the overbought threshold, giving price ample room to test higher prices.

Active traders who enter at these levels should look to book profits near the 2020 high at $43.08. Manage risk by placing a stop-loss order somewhere below the 200-day SMA.

For a look at today’s earnings schedule, check out our earnings calendar.