Stock Analysis on Net

Pfizer Inc. (NYSE:PFE)

Economic Value Added (EVA)

Microsoft Excel

Economic Profit

Pfizer Inc., economic profit calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net operating profit after taxes (NOPAT)1 7,374 (1,277) 31,018 18,394 6,095
Cost of capital2 8.91% 8.74% 10.15% 9.95% 9.49%
Invested capital3 135,777 154,882 110,746 87,670 103,898
 
Economic profit4 (4,723) (14,820) 19,779 9,674 (3,768)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 7,3748.91% × 135,777 = -4,723

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. Pfizer Inc. economic profit decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Net Operating Profit after Taxes (NOPAT)

Pfizer Inc., NOPAT calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net income attributable to Pfizer Inc. common shareholders 8,031 2,119 31,372 21,979 9,616
Deferred income tax expense (benefit)1 (2,102) (3,443) (3,764) (4,293) (1,468)
Increase (decrease) in allowance for doubtful accounts2 (32) 21 (43) (16) 15
Increase (decrease) in restructuring accruals3 132 784 133 273 (18)
Increase (decrease) in equity equivalents4 (2,002) (2,638) (3,674) (4,036) (1,471)
Interest expense 3,091 2,209 1,238 1,291 1,449
Interest expense, operating lease liability5 98 120 97 83 42
Adjusted interest expense 3,189 2,329 1,335 1,374 1,491
Tax benefit of interest expense6 (670) (489) (280) (289) (313)
Adjusted interest expense, after taxes7 2,519 1,840 1,054 1,085 1,178
(Gain) loss on marketable securities (966) (1,731) 3,082 (1,374) (728)
Interest income (545) (1,624) (251) (36) (73)
Investment income, before taxes (1,511) (3,355) 2,831 (1,410) (801)
Tax expense (benefit) of investment income8 317 705 (595) 296 168
Investment income, after taxes9 (1,194) (2,650) 2,236 (1,114) (633)
(Income) loss from discontinued operations, net of tax10 (11) 14 (6) 434 (2,631)
Net income (loss) attributable to noncontrolling interest 31 39 35 46 36
Net operating profit after taxes (NOPAT) 7,374 (1,277) 31,018 18,394 6,095

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in allowance for doubtful accounts.

3 Addition of increase (decrease) in restructuring accruals.

4 Addition of increase (decrease) in equity equivalents to net income attributable to Pfizer Inc. common shareholders.

5 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 2,642 × 3.70% = 98

6 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 3,189 × 21.00% = 670

7 Addition of after taxes interest expense to net income attributable to Pfizer Inc. common shareholders.

8 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 1,511 × 21.00% = 317

9 Elimination of after taxes investment income.

10 Elimination of discontinued operations.

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. Pfizer Inc. NOPAT decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Cash Operating Taxes

Pfizer Inc., cash operating taxes calculation

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Provision (benefit) for taxes on income (28) (1,115) 3,328 1,852 477
Less: Deferred income tax expense (benefit) (2,102) (3,443) (3,764) (4,293) (1,468)
Add: Tax savings from interest expense 670 489 280 289 313
Less: Tax imposed on investment income 317 705 (595) 296 168
Cash operating taxes 2,426 2,113 7,967 6,137 2,090

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. Pfizer Inc. cash operating taxes decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Invested Capital

Pfizer Inc., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Short-term borrowings, including current portion of long-term debt 6,946 10,350 2,945 2,241 2,703
Long-term debt, excluding current portion 57,405 61,538 32,884 36,195 37,133
Operating lease liability1 2,642 3,153 3,217 2,959 1,435
Total reported debt & leases 66,993 75,041 39,046 41,395 41,271
Total Pfizer Inc. shareholders’ equity 88,203 89,014 95,661 77,201 63,238
Net deferred tax (assets) liabilities2 (4,451) (1,128) (3,746) (1,269) 3,123
Allowance for doubtful accounts3 438 470 449 492 508
Restructuring accruals4 2,120 1,988 1,204 1,071 798
Equity equivalents5 (1,893) 1,330 (2,093) 294 4,429
Accumulated other comprehensive (income) loss, net of tax6 7,842 7,961 8,304 5,897 11,688
Equity attributable to noncontrolling interests 294 274 255 261 235
Adjusted total Pfizer Inc. shareholders’ equity 94,446 98,579 102,127 83,653 79,590
Construction in progress7 (4,937) (5,925) (4,875) (3,822) (3,552)
Marketable securities8 (20,725) (12,813) (25,552) (33,556) (13,411)
Invested capital 135,777 154,882 110,746 87,670 103,898

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of restructuring accruals.

5 Addition of equity equivalents to total Pfizer Inc. shareholders’ equity.

6 Removal of accumulated other comprehensive income.

7 Subtraction of construction in progress.

8 Subtraction of marketable securities.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. Pfizer Inc. invested capital increased from 2022 to 2023 but then slightly decreased from 2023 to 2024.

Cost of Capital

Pfizer Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 147,918 147,918 ÷ 211,506 = 0.70 0.70 × 11.23% = 7.85%
Debt3 60,946 60,946 ÷ 211,506 = 0.29 0.29 × 4.49% × (1 – 21.00%) = 1.02%
Operating lease liability4 2,642 2,642 ÷ 211,506 = 0.01 0.01 × 3.70% × (1 – 21.00%) = 0.04%
Total: 211,506 1.00 8.91%

Based on: 10-K (reporting date: 2024-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 155,569 155,569 ÷ 230,072 = 0.68 0.68 × 11.23% = 7.59%
Debt3 71,350 71,350 ÷ 230,072 = 0.31 0.31 × 4.54% × (1 – 21.00%) = 1.11%
Operating lease liability4 3,153 3,153 ÷ 230,072 = 0.01 0.01 × 3.80% × (1 – 21.00%) = 0.04%
Total: 230,072 1.00 8.74%

Based on: 10-K (reporting date: 2023-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 237,687 237,687 ÷ 273,849 = 0.87 0.87 × 11.23% = 9.74%
Debt3 32,945 32,945 ÷ 273,849 = 0.12 0.12 × 3.97% × (1 – 21.00%) = 0.38%
Operating lease liability4 3,217 3,217 ÷ 273,849 = 0.01 0.01 × 3.00% × (1 – 21.00%) = 0.03%
Total: 273,849 1.00 10.15%

Based on: 10-K (reporting date: 2022-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 258,449 258,449 ÷ 305,649 = 0.85 0.85 × 11.23% = 9.49%
Debt3 44,241 44,241 ÷ 305,649 = 0.14 0.14 × 3.79% × (1 – 21.00%) = 0.43%
Operating lease liability4 2,959 2,959 ÷ 305,649 = 0.01 0.01 × 2.80% × (1 – 21.00%) = 0.02%
Total: 305,649 1.00 9.95%

Based on: 10-K (reporting date: 2021-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 188,635 188,635 ÷ 238,306 = 0.79 0.79 × 11.23% = 8.89%
Debt3 48,236 48,236 ÷ 238,306 = 0.20 0.20 × 3.71% × (1 – 21.00%) = 0.59%
Operating lease liability4 1,435 1,435 ÷ 238,306 = 0.01 0.01 × 2.90% × (1 – 21.00%) = 0.01%
Total: 238,306 1.00 9.49%

Based on: 10-K (reporting date: 2020-12-31).

1 US$ in millions

2 Equity. See details »

3 Debt. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

Pfizer Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Economic profit1 (4,723) (14,820) 19,779 9,674 (3,768)
Invested capital2 135,777 154,882 110,746 87,670 103,898
Performance Ratio
Economic spread ratio3 -3.48% -9.57% 17.86% 11.03% -3.63%
Benchmarks
Economic Spread Ratio, Competitors4
AbbVie Inc. -2.95% -4.67% 4.77% 4.21% -3.56%
Amgen Inc. -0.06% 2.75% 7.32% 7.30% 11.63%
Bristol-Myers Squibb Co. -22.34% 1.22% -1.58% 0.74% -14.77%
Danaher Corp. -7.80% -8.55% -3.59% -2.89% -4.28%
Eli Lilly & Co. 15.09% 1.95% 9.31% 11.04% 17.72%
Gilead Sciences Inc. -7.75% 5.38% 2.34% 9.05% -4.02%
Johnson & Johnson 1.49% -0.37% 4.90% 9.96% 4.76%
Merck & Co. Inc. 13.36% -8.94% 11.24% 11.41% 4.25%
Regeneron Pharmaceuticals Inc. 21.18% 18.02% 23.37% 67.07% 38.56%
Thermo Fisher Scientific Inc. -4.60% -5.10% -3.32% -1.45% -0.50%
Vertex Pharmaceuticals Inc. -22.67% 11.28% 14.03% 15.24% 28.52%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 Economic profit. See details »

2 Invested capital. See details »

3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × -4,723 ÷ 135,777 = -3.48%

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. Pfizer Inc. economic spread ratio deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.

Economic Profit Margin

Pfizer Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Economic profit1 (4,723) (14,820) 19,779 9,674 (3,768)
Revenues 63,627 59,553 101,175 82,145 42,678
Performance Ratio
Economic profit margin2 -7.42% -24.88% 19.55% 11.78% -8.83%
Benchmarks
Economic Profit Margin, Competitors3
AbbVie Inc. -3.63% -5.86% 6.75% 7.19% -8.07%
Amgen Inc. -0.11% 7.15% 11.73% 12.10% 18.60%
Bristol-Myers Squibb Co. -28.98% 1.83% -2.46% 1.29% -31.32%
Danaher Corp. -24.07% -28.07% -8.91% -7.23% -12.54%
Eli Lilly & Co. 12.00% 1.68% 7.92% 10.19% 17.73%
Gilead Sciences Inc. -12.01% 9.15% 3.95% 16.00% -8.30%
Johnson & Johnson 1.79% -0.43% 5.88% 10.42% 5.67%
Merck & Co. Inc. 16.53% -10.41% 14.01% 16.56% 5.06%
Regeneron Pharmaceuticals Inc. 18.58% 16.44% 23.53% 45.35% 37.57%
Thermo Fisher Scientific Inc. -8.80% -10.18% -6.13% -2.95% -0.94%
Vertex Pharmaceuticals Inc. -18.61% 15.14% 20.71% 18.89% 37.42%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 Economic profit. See details »

2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Revenues
= 100 × -4,723 ÷ 63,627 = -7.42%

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. Pfizer Inc. economic profit margin deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.