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Comparing Pfizer’s and Merck’s 2019 Earnings Growth Trajectories

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EPS projections for Pfizer

In its first-quarter earnings investor presentation, Pfizer (PFE) raised its 2019 adjusted diluted EPS guidance from $2.82–$2.92 to $2.83–$2.93. The company also raised its 2019 adjusted other income guidance from $100 million to $200 million.

According to its first-quarter earnings conference call, the increase in adjusted other income guidance and other favorable adjustments have resulted in a net favorable impact of $0.03 per share on Pfizer’s 2019 EPS. However, unfavorable foreign exchange movements at mid-January rates are expected to have an unfavorable impact of $0.02 per share on its 2019 EPS. The combined impact of these two factors has led to a $0.01 increase in the company’s 2019 guidance at the midpoint.

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Analysts expect Pfizer’s adjusted diluted EPS to see YoY changes of -3.02% to $2.91 in 2019, 5.38% to $3.07 in 2020, and 7.72% to $3.30 in 2021. The company expects its top line and bottom line performances in the second half of 2019 and in 2020 to be affected by the loss of exclusivity of Lyrica, which is scheduled for June 30, 2019.

EPS projections for Merck

In its first-quarter earnings investor presentation, Merck & Co. (MRK) narrowed and raised its 2019 non-generally accepted accounting principles EPS guidance from $4.57–$4.72 to $4.67–$4.79. While the previous guidance represented a YoY rise of 5%–9% on a reported basis and 4%–8% on an ex-foreign-exchange basis, the new guidance represents a YoY rise of 8%–10% on a reported basis as well as an ex-foreign-exchange basis. The company, however, expects a positive impact that’s slightly lower than the previously assumed one percentage point on its EPS at mid-April rates due to foreign exchange fluctuations.

According to its first-quarter earnings conference call, Merck expects its oncology, vaccines, hospital and specialty, and animal health businesses to be its key growth drivers in 2019. Analysts expect Merck’s adjusted diluted EPS to see YoY rises of 9.29% to $4.74 in 2019, 11.86% to $5.31 in 2020, and 11.08% to $5.89 in 2021.

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