Pfizer shareholders are pegged to receive an even bigger dividend payout this year, according to analysts, with the feared Covid-19 cliff edge yet to materialise for the firm.
The US pharmaceutical giant on Thursday declared a $0.40 (31p) dividend for the second quarter of this year, ahead of its first-quarter results published tomorrow.
With shareholders lined up for a payday on June 10, the cash dividend will be the 334th consecutive quarterly investor payout by Pfizer.
Pfizer’s stock, trading slightly lower at $48.21 (£38.30) yesterday, has lost 18.5 per cent in the year-to-date after gaining nearly 60 per cent in 2021 when Covid-19 cases were at their peak.
Despite this, “Some investors will be chomping at the bit to buy some of the company’s stock based on its dividend history,” wrote analysts at Simply Wall St, adding that Pfizer’s “sustainability” has been particularly eye catching.
“Earnings per share is growing at a solid clip, and the payout ratio is low which we think is an ideal combination in a dividend stock as the company can quite easily raise the dividend in the future.”
Pfizer swallowed a share price slip in February, after its fourth quarter revenue dipped below Wall Street forecasts – despite nearly doubling its full-year revenue.
The sell-off had been spurred by fears over a coronavirus cliff edge, with investors and analysts concerned the market may be heading towards a natural decline in activity and interest.
The famed Covid-19 vaccine maker has thoroughly reaped the economic rewards of the pandemic, anticipating around $50bn (£39.7bn) in sales from its jab alone in 2022.
A reality for others
While Pfizer has avoided the plunge, in part due to its sheer size and $275.9bn (£219.5bn) market capitalisation, others haven’t been so lucky.
London-listed Oxford Biomedica, which helped manufacture the AstraZeneca Covid-19 vaccine, just two weeks ago warned of a sales drop – making investors coronavirus-market fears a reality.
Shares in the cell and gene therapy group slumped more than 15 per cent on the day of the warning to 499p per share and have collapsed more than 50 per cent in the year-on-date.
Although Pfizer has been unscathed in regard to similar warnings and sell-offs, Simply Wall St analysts expect the company’s earnings to decline by an average of 10 per cent annually, for the next three years.
In a statement on Thursday, Pfizer CEO Albert Bourla said: “2021 was a year in which Pfizer set all-time highs in all major areas of focus for our Company further cementing Pfizer as a scientific powerhouse capable of taking on the world’s most devastating diseases.
“Looking ahead, we are well positioned to continue to deliver meaningful value for patients, investors and all stakeholders underpinned by the momentum of our business, the strength of our internal pipeline and our ability to deploy capital into growth-focused business development to access external science.”