Since the labor market has shown resilience, the Fed is expected to announce another 75-bps hike in November 2022. Minneapolis Federal Reserve Bank President Neel Kashkari said, “I think we are moving at an appropriately aggressive pace.” However, Kashkari is hopeful of a soft landing.
Market volatility is rife, as is evident from the CBOE Volatility Index’s 94% year-to-date increase. On the other hand, CNBC’s Jim Cramer believes that stocks could bottom later this month, followed by a ‘powerful’ rally. Furthermore, Citigroup has recently projected global equities to rise about 18% through the end of 2023.
Given the backdrop, we think fundamentally sound stocks Pfizer Inc. (PFE) and CVS Health Corporation (CVS) could be wise additions to your portfolio. Since these stocks have survived the market volatility well, you would have benefitted even more had you invested in them earlier.
Pfizer Inc. (PFE)
PFE discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. The company serves wholesalers, retailers, hospitals, clinics, government agencies, pharmacies, individual provider offices, and disease control and prevention centers.
On October 5, 2022, PFE completed its acquisition of biopharmaceutical company Global Blood Therapeutics, Inc. (GBT). The companies are expected to co-deliver significant advancements in treating Sickle Cell Disease.
Also, on October 3, 2022, PFE acquired Biohaven Pharmaceutical Holding Company Ltd., the maker of NURTEC® ODT (rimegepant), an innovative migraine therapy approved for both acute treatment and prevention of periodic migraine in adults. This partnership should help PFE better serve the growing population of migraine patients.
PFE's total revenues came in at $27.74 billion for the second quarter that ended July 31, 2022, up 46.8% year-over-year. Its net income came in at $9.91 billion, up 78.1% year-over-year, while its EPS came in at $1.73, up 76.5% year-over-year.
Analysts expect PFE's revenue to increase 23.2% year-over-year to $100.12 billion in 2022. Its EPS is estimated to grow 46.4% year-over-year to $6.47 in 2022. It has surpassed EPS estimates in all four trailing quarters. PFE's shares have gained marginally intraday to close the last trading session at $41.92.
PFE's POWR Ratings reflect this promising outlook. The company has an overall rating of A, equating to a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
PFE has an A grade for Value and a B for Quality. Within the Medical - Pharmaceuticals industry, it is ranked #14 among 164 stocks. Click here to see the additional POWR Ratings for Momentum, Growth, Stability, and Sentiment for PFE.
CVS Health Corporation (CVS)
CVS provides health services in the United States. The company's Health Care Benefits segment offers traditional, voluntary, and consumer-directed health insurance products and related services.
On August 3, 2022, Karen S. Lynch, CVS’ President, and CEO, said, “We remain a trusted community health destination for millions of individuals with health products and services that engage customers in all aspects of their health wherever and whenever they need it.”
CVS’ total revenues came in at $80.64 billion for the second quarter that ended June 30, 2022, up 11% year-over-year. Its net income came in at $2.95 billion, up 6% year-over-year. Moreover, its EPS came in at $2.23, up 6.2% year-over-year.
CVS' revenue is expected to increase 6.9% year-over-year to $312.35 billion in 2022. Its EPS is estimated to increase marginally year-over-year to $8.55 in 2022. It surpassed EPS estimates in all four trailing quarters. Over the past year, the stock has gained 5% to close the last trading session at $88.50.
CVS' overall A rating equates to a Strong Buy in our POWR Ratings system. It has a B grade for Growth, Stability, and Sentiment. It is ranked first among four stocks in the B-rated Medical - Drug Stores industry. Click here to see the additional POWR Ratings for Momentum, Value, and Quality for CVS.
PFE shares were trading at $42.39 per share on Wednesday afternoon, up $0.47 (+1.12%). Year-to-date, PFE has declined -26.51%, versus a -23.62% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
2 Stocks You'll Wish You Bought a Lot Earlier StockNews.com
