| dc.description.abstract | The aim of the thesis was to estimate the intrinsic and relative value of Pfizer Inc. by
analysing both: Pfizer and the pharmaceutical industry. To create a multitude of valuation
estimates the following valuation methods were utilized: Discounted Cash Flow (DCF)
analysis, Comparable Company Analysis (CCA), and the Precedent Transaction Analysis
(PTA). This allowed for several estimates both for intrinsic and relative value, further
choosing one valuation to be representative of the overall thesis.
The intrinsic valuations (DCF) returned estimated values per share ranging from roughly $75-
100 and the relative valuations (CCA & PTA) returned estimated values per share ranging
from roughly $58-158. The broad range of estimated values are representative of the 3
different valuation methods utilized. The relative valuations yielded the highest, most
dispersed estimated values per share, as they were based upon current and prior market
conditions for the pharmaceutical sector. The relative valuations were further skewed due to
the current market conditions, as a result of the pandemic. The intrinsic valuations yielded
more concise values per share, due to the lesser changes from the models applied.
The representative valuation for the thesis is the intrinsic valuation of $88.71. This estimated
value per share was calculated utilizing the DCF-analysis with projected cash flows reflective
of the demand for Pfizer’s COVID-19 portfolio and IQVIA’s growth estimate regarding the
future growth for the pharmaceutical industry. Overall, this intrinsic valuation is greater than
the current market price of $40.12 (8th March 2023), further indicating that the share price for
Pfizer Inc. is undervalued by the market. | |
