Pfizer Stock: Benefiting From Trump Healthcare Policies
Pfizer Inc. (NYSE:PFE) stock has been surging after the stunning victory of Donald Trump for the Whitehouse’s top spot, on hopes that his healthcare policies will benefit biotech companies.
Pfizer stock, which is one of the biggest global pharmaceutical firms, is leading gains in the biotech sector, surging as much as 9.4% during early trading in New York City, riding on the positive wave for the biotech sector.
PFE stock rose to about $33.00, its highest level since September 26. Pfizer stock rose as U.S. stocks rebounded from steep overnight losses. The Dow Jones and the S&P 500 briefly turned positive shortly after the open, led by strong gains in the heavily weighted healthcare sector, which rose about three percent.
The big impetus for Pfizer stock is the policy direction on healthcare reforms that Donald Trump promised to take if he won the election. That means the immediate repeal of Obamacare, otherwise known as the Affordable Care Act.
In contrast to Trump’s policies, Hillary Clinton favored more regulations for drug pricing. In August, Clinton called the skyrocketing price of the “EpiPen” by Mylan Pharmaceuticals Inc. “the latest troubling example of a company taking advantage of its consumers.’’ (Source: “Hillary Clinton blasts ‘outrageous’ explosion in EpiPen pricing, and drugmakers’ stocks are feeling the heat,” Business Insider, August 24, 2016.)
That statement from Clinton sent stock prices of drug-makers tumbling that day.
Trump, in his healthcare reform agenda, has clearly mentioned that he will work with the U.S. Congress to do away with Obamacare, which was the key policy initiative by President Barack Obama during his eight-year tenure.
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“On day one of the Trump Administration, we will ask Congress to immediately deliver a full repeal of Obamacare,’’ outlined Trump on his web site. “By following free market principles and working together to create sound public policy that will broaden healthcare access, make healthcare more affordable and improve the quality of the care available to all Americans.” (Source: “Healthcare Reform To Make America Great Again,” Trump Pence, last accessed on November 11, 2016.)
Changing fortunes for Pfizer stock may be a good opportunity for long-term investors who are seeking to add a global pharma name in their portfolio with a great dividend yield.
PFE stock is one of the top dividend companies when compared to the average dividend yield available in the market.
Since the second quarter of 2011, Pfizer’s dividend has increased 50% to $0.30 a share, from $0.20 a share. Yielding 3.7%, Pfizer stock is much ahead in the game when it comes to its competitors, such as Johnson & Johnson (NYSE:JNJ), which offers a dividend yield of 2.69%.