June 18, 2025 a 02:46 am
PFE: Dividend Analysis - Pfizer Inc.
Pfizer Inc., a leading player in the pharmaceutical industry, boasts a solid dividend profile with a dividend history stretching over five decades. The company's strong dividend yield and consistent dividend payments make it an attractive choice for dividend investors. However, with a high payout ratio based on earnings, it is crucial for investors to monitor Pfizer's financial health and profitability to maintain its dividend distribution.
Overview
Pfizer Inc. demonstrates a robust position within the healthcare sector, showcasing significant dividend yield and consistent payments.
| Metric | Data |
|---|---|
| Sector | Healthcare |
| Dividend Yield | 7.63% |
| Current Dividend per Share | 1.68 USD |
| Dividend History | 54 years |
| Last Cut or Suspension | None |
Dividend History
Pfizer's long-standing tradition of increasing its dividends highlights its commitment to returning value to shareholders and reinforces its status as a reliable investment in income portfolios.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 0.86 |
| 2024 | 1.68 |
| 2023 | 1.64 |
| 2022 | 1.60 |
| 2021 | 1.56 |
Dividend Growth
The stability of a company’s dividend growth is a critical factor for investors seeking income through dividends.
| Time | Growth |
|---|---|
| 3 years | 2.50% |
| 5 years | 3.13% |
The average dividend growth is 3.13% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio
The payout ratio is a critical indicator of sustainability. It shows how much of the earnings are being paid out in dividends.
| Key figure | Ratio |
|---|---|
| EPS-based | 121.16% |
| Free cash flow-based | 101.05% |
With a payout ratio of over 100% both in EPS and FCF, the company's dividend payments exceed its earnings and free cash flow, which could raise concerns about the sustainability of its dividends in the long term.
Cashflow & Capital Efficiency
Assessing cash flow stability and capital efficiency is vital to understand how well a company can manage its finances to support dividend payments.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Free Cash Flow Yield | 9.06% | 2.95% | 6.55% |
| Earnings Yield | 10.92% | 1.30% | 5.34% |
| CAPEX to Operating Cash Flow | 11.06% | 44.91% | 22.83% |
| Stock-based Compensation to Revenue | 0.87% | 0.90% | 1.38% |
| Free Cash Flow / Operating Cash Flow Ratio | 88.94% | 55.09% | 77.17% |
Despite fluctuations in cash flows, the company maintains a robust cash flow position with an efficient capital expenditure ratio, indicating the ability to finance dividend payouts effectively in the near term.
Balance Sheet & Leverage Analysis
Analyzing the balance sheet and leverage ratios allows assessing the financial health and debt levels of the company, crucial for long-term sustainability and growth.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Debt-to-Equity | 36.45% | 79.59% | 72.16% |
| Debt-to-Assets | 17.68% | 31.28% | 29.83% |
| Debt-to-Capital | 26.71% | 44.32% | 41.92% |
| Net Debt to EBITDA | 0.83 | 7.11 | 3.47 |
| Current Ratio | 1.22 | — | 1.26 |
| Quick Ratio | 1.00 | 0.69 | 0.92 |
| Financial Leverage | 2.06 | 2.54 | 2.42 |
While the company shows manageable debt levels, an increase in leverage ratios suggests a cautious approach is needed to monitor its financial stability amidst market volatilities.
Fundamental Strength & Profitability
The fundamental analysis provides insight into Pfizer's profitability and operational performance, vital for evaluating long-term investment potential.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Return on Equity | 32.79% | 2.38% | 9.11% |
| Return on Assets | 15.91% | 0.94% | 3.76% |
| Margins: Net | 31.27% | 3.62% | 12.62% |
| EBIT | 35.85% | 5.58% | 17.47% |
| EBITDA | 40.90% | 16.34% | 28.49% |
| Gross | 65.77% | 49.25% | 74.19% |
| R&D to Revenue | 11.39% | 18.26% | 17.01% |
Despite some variances over years, Pfizer’s strong profitability metrics provide a reassuring outlook on ongoing operational efficiency and profit maximization aimed towards sustainable growth.
Price Development
Dividend Scoring System
| Criteria | Score | Bar |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 5 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 3 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Total Score: 29/40
Rating
Pfizer Inc. maintains a robust dividend framework with commendable yield and history, making it an attractive option for dividend-focused portfolios. However, high payout ratios and moderate growth prospects underline a need for cautious optimism. Investors are advised to monitor financial health vigilantly to uphold the sustainability of returns.