Pfizer Inc. (PFE) Intrinsic Value & DCF Valuation
Drug Manufacturers - General · NYSE
Current Price
$24.79
Intrinsic Value
$19.54
-26.8% margin of safety
What Is Pfizer Inc.'s Intrinsic Value?
As of 2026-07-30, the base-case DCF model estimates the intrinsic value of Pfizer Inc. (PFE) at $19.54 per share, compared with a market price of $24.79, a margin of safety of -26.8%. The base case assumes -2.4% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $15.41 to $24.37. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Pfizer Inc. (PFE) Undervalued?
At the current price of $24.79, PFE trades above the base-case intrinsic value estimate by a meaningful margin. By this model the stock looks expensive, though faster growth than assumed would change the picture.
COMPETITIVE MOAT
↑Patent Protection & R&D Pipeline
Pfizer benefits from patent exclusivity on its blockbuster drugs, providing a temporary monopoly. Its extensive R&D pipeline offers potential for future revenue streams and market dominance.
↑Global Manufacturing & Distribution Scale
The company's vast manufacturing capacity and established global distribution network create significant barriers to entry. This scale allows for efficient production and broad market access.
↑Brand Reputation & Trust
Pfizer's long-standing reputation for developing life-saving medicines fosters trust among healthcare providers and patients. This brand equity can influence prescribing decisions and market acceptance.
INVESTMENT RISKS
↓Pipeline Failure & R&D Uncertainty
The success of future revenue hinges on the R&D pipeline, which carries inherent risks of clinical trial failures or lack of market adoption. A stalled pipeline can significantly impact future growth.
↓Litigation & Product Liability
Pfizer faces ongoing litigation risks related to its products, which can result in substantial financial penalties and reputational damage. These legal battles can be costly and unpredictable.
↓Geopolitical & Economic Instability
Global economic downturns or geopolitical conflicts can disrupt supply chains, impact demand for pharmaceuticals, and affect currency exchange rates. These external factors pose broad operational challenges.
Base case
PFE base case valuation
Intrinsic Value
$19.54
Margin of safety
-26.8%
Expected annual return
-4.6%
Base case assumptions: -2.4% annual growth, 10.0% discount rate, 15x exit multiple, 5 year projection. Data as of 2026-07-30.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the PFE valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Pfizer Inc. respond.
Open DCF Calculator for PFECompany Overview
Pfizer Inc. is a global biopharmaceutical leader engaged in the research, development, production, marketing, and distribution of a wide array of medicinal and vaccine products worldwide. Its comprehensive portfolio addresses diverse therapeutic areas, including cardiovascular health and women's health, featuring key brands such as the Premarin family and Eliquis. The company also offers advanced biologics, small molecule drugs, immunotherapies, and biosimilars for various conditions, exemplified by Ibrance, Xtandi, and Retacrit. Furthermore, Pfizer provides sterile injectables, anti-infective agents, and a significant oral treatment for COVID-19, including Paxlovid. A substantial portion of its offerings comprises vaccines for infectious diseases such as pneumococcal and meningococcal disease, tick-borne encephalitis, and COVID-19, with notable products like Comirnaty and the Prevnar family. The firm also develops biosimilars for chronic autoimmune and inflammatory disorders, including Inflectra and Xeljanz, alongside specialized therapies for rare conditions like amyloidosis, hemophilia, and endocrine disorders, under brands such as Vyndaqel and BeneFIX. Beyond its proprietary products, Pfizer operates a contract manufacturing division. Its extensive customer base includes wholesalers, retailers, hospitals, clinics, government agencies, pharmacies, individual medical practices, and public health organizations. The company actively fosters strategic collaborations with numerous partners, such as Bristol-Myers Squibb Company, BioNTech SE, and Merck KGaA. Established in 1849, Pfizer Inc. is headquartered in New York, New York.
Financial Metrics — PFE Stock Valuation Data
Revenue/Share (TTM)
$11.13
FCF/Share (TTM)
$1.67
ROIC (TTM)
8.0%
ROE (TTM)
8.4%
P/FCF
14.9x
EV/EBITDA
12.2x
FCF Yield
6.71%
Debt/Equity
0.72x
On a trailing twelve-month basis, PFE generates free cash flow per share of $1.67 alongside a ROIC of 8.0%, both central inputs for a DCF valuation. Its P/FCF ratio of 14.9x and FCF yield of 6.71% then frame how PFE is priced against peers on a cash flow basis.
Frequently Asked Questions
What is the intrinsic value of PFE?
Pfizer Inc. currently generates $1.67 in free cash flow per share. At the current price of $24.79, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is PFE undervalued?
PFE trades at a P/FCF ratio of 14.9x with a free cash flow yield of 6.71%. A low P/FCF means investors are paying less per dollar of free cash flow; whether that is cheap depends on the company's growth, cyclicality, and capital intensity. However, whether PFE is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value PFE stock using DCF?
To perform a DCF valuation on Pfizer Inc.: (1) Start with the trailing free cash flow per share ($1.67) as the base, (2) project future FCF growth over 5-10 years based on Drug Manufacturers - General industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting PFE's risk profile — with a debt-to-equity of 0.72x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to PFE?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Pfizer Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Drug Manufacturers - General trends, then discounting those amounts to today's dollars. PFE's ROIC of 8.0% means the company's return on invested capital sits below the level that typically clears its cost of capital.
How does WACC affect PFE stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For PFE, with a debt-to-equity ratio of 0.72x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 12.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See PFE PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Healthcare valuationsDCF and P/E value PFE with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-30. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.