What about the future of PFE and GE stocks..?

Question

these two stocks are too down.. what do you expect the prices for the next month... is rebound or going more down...

Answer 1

A month is a pretty short horizon for betting on stocks. If we knew the answer to this we would all buy them!  That's the whole idea being there being risk in the stock market. The 52 week range for PFE is $17.95 to $26.xx. I'd say it is at its low...with room to go further down. It's one year target price is only $24...so I would say over the next month, it is not going up very far.  I haven't bothered to look at GE. I think until the housing market recovers, they will stay down. Think about all the things that are impacted when people are not buying new houses...Well, they are not buying new appliances. It is similar to the paint companies right now...when people don't buy or build new homes, even the paint industry hurts...as do furniture companies that are taking a huge hit. I personally never buy anything that I'm planning on holding for one month. I buy long term.

Answer 2

GE is the better bet. First, they have many diversified global businesses, like their jet engine, wind turbine and water desalinization (water treatment) businesses.  The wind and water businesses will do well globally especially as the price of oil continues to increase.  GE also shows that they are willing to sell businesses that don't have as good as future prospects, such as their plastics business that they sold and their appliance business that they are planning to sell. They will redeploy the money that they get from these into higher margin businesses.  Their dividend yield is now over 4% which is historically high.

Pfizer on the other hand has been in a downtrend for years.  Its major drugs are coming off patent and they don't have anything in the pipeline.  Their CEO is a former lawyer and lawyers are not generally known for their business acumen.  Their dividend is large and a recent article said that it may be unsustainable.  They have to do something big like acquiring a biotech company in order to get some new drugs, and the risk in any acquisition is that they overpay and that the intergration is botched.   I would expect Pfizer to continue down or trade flat.  Investors will be attracted to the dividend, but if the underlying prospects are not great, that is not the best reason to buy the stock.

Answer 3

I'm not a big fan of GE so don't follow it, but I have owned PFE for several years. They do have some blockbuster drugs coming off patent in the next few years, but I'm betting that there's enough in the pipeline to replace most or all of the revenues to offset that loss. If I'm right, the current dividend yield of over 7% is too good to pass up. So I actually bought more yesterday and also signed up for their dividend reinvestment program (DRIP). If I'm wrong they'll probably lower their dividend. I don't make predictions over short time frames like 1 month. I have no clue.