[Fools love pfe]--
Pfizer's Earnings
News of the week
by Tom Gardner
(TomG@fool.com)
Alexandria, VA (July 13, 1998) -- The
Cash-King Portfolio showed no signs of a
lingering hangover from the 4th of July weekend.
All but two of our holdings whistled and banged
in the night sky last week. Only our most
defensive holdings -- the oil stocks in the Fool-4
grouping -- failed to blaze in the starry night.
The All Stars of the Week were Pfizer and Intel,
which blasted up 9.7% and 9%, respectively.
Pfizer is now sitting a few dollars from its richest
valuation ever after an eye-catching earnings
announcement, which I'll discuss below.
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Pfizer (NYSE: PFE) announced 2nd-quarter earnings that ran a few
pennies above estimates. The company benefited from an
estimate-stomping $411 million in sales from its male impotency treatment,
Viagra. Not overlooked by the investing community, that figure includes
just $2 million of international sales. The future looks very bright for this
drug. But Pfizer is much more than Viagra, which accounted for just 11%
of the company's total sales for the quarter. Let's take a look at the
earnings box:
2Q 1998 2Q 1997
Sales $3.6 bil. $2.9 bil.
Earnings $628 mil. $457 mil.
EPS $0.47 $0.35
Take a breath -- there are some numbers oncoming.
Pfizer's second quarter marked sales growth of 25%, earnings growth of
38%, and growth in earnings per share of 34%. Simultaneously, Pfizer
inched its gross margins up to 83.9% from 82.5%, and its net margins to
17.3% from 15.7%. Spending on research & development for the quarter
increased 25%, to $574 million, in line with sales growth.
Pfizer's report exceeded our expectations, showed improvement in our
critical Cash-King measures, and we believe confirms our approach to the
markets. We'll get a better look at the financial strength of the quarter
when the company releases its balance sheet in late July. Click here now
though pfor management's comments and pfor the company's 2nd Quarter
income statement: Pfizer's 2nd Quarter Earnings Report.
Pfizer is now up more than p43% pfor us since our purchase in Pfebruary.
Given Pfizer's perpformance in 1998, we're considering renaming a lot of
stupf around here now. The Motley Pfool, The Cash-King Portpfolio,
pfree registration to our message boards, the word Pfriday, and the
number pfour -- to name a pfew.
We're just considering it! |
