What Happened?
Shares of global pharmaceutical company Pfizer (NYSE: PFE) jumped 7.2% in the afternoon session after the company announced a landmark agreement with the U.S. government aimed at lowering prescription drug prices for American patients.
The historic pact includes several key measures. Pfizer will voluntarily align prices for its drugs in Medicaid programs with those in other developed countries, a policy referred to as 'most-favored-nation' pricing. Additionally, the company will offer medicines directly to consumers at significant discounts—averaging 50%—through a new government-operated website, TrumpRx.gov. In return for these pricing concessions and a commitment to invest $70 billion in U.S. research and manufacturing, Pfizer secured a three-year grace period from potential tariffs. The market reacted positively, as the voluntary agreement is seen as a way for the pharmaceutical industry to avoid stricter legislation and removes a major policy uncertainty that has weighed on the sector.
The shares closed the day at $27.22, up 6.9% from previous close.
Is now the time to buy Pfizer? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Pfizer’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 5.9% on the news that the company reached an agreement with the U.S. government to lower drug prices and reported positive trial data for a weight-loss drug from a recently acquired company.
Pfizer is up 2.2% since the beginning of the year, but at $27.20 per share, it is still trading 9.9% below its 52-week high of $30.19 from October 2024. Investors who bought $1,000 worth of Pfizer’s shares 5 years ago would now be looking at an investment worth $747.87.
Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link.
