A trend can be evaluated a little easier using key simple moving averages: the 50-day, 100-day, and 200-day. What are these key moving averages saying about the trend in Pfizer stock? Currently, the stock price is above its consecutively stacked 50-day, 100-day, and 200-day simple moving averages, meaning that the stock is in an uptrend. How can we assess the strength of a trend? The direction. The key moving averages for Pfizer stock are all pointing upwards, signaling a strong uptrend. Ultimately, the moving averages are pointing towards an uptrend that is strong.
One other key factor that determines the success of a stock is investor sentiment. A way to gain insight into investor sentiment is through the use of the options market. More specifically, taking a look at the implied volatility and implied volatility skew levels of Pfizer options may help determine if investors are bullish, neutral, or bearish. The implied volatility of Pfizer options is at 19.94 percent today, which coincides with a 96th percentile over the last 30 trading days and 83rd percentile over the last 90 trading days. What does this mean? This means that investors or traders are buying a significant amount of protection compared to the last 30 and 90 trading days. The implied volatility skew of March and April put options is steep, while call option skew is flat. Now, what does this mean? As of today, there is a low demand from call buyers or high supply of call sellers, while there is high demand by put buyers or low demand by put sellers, all neutral to bearish over the next 2 months. So, investors are buying a significant amount of protection and are leaning neutral to bearish over the next 2 months.
E = Earnings Are Increasing Quarter-Over-Quarter
A mature company, like Pfizer, will see less influence from their earnings growth and revenue growth numbers than a stock who’s valuation is solely dependent on growth (earlier stage companies). Regardless, investors still expect a mature company to perform well. Over the last 8 quarters, Pfizer has seen earnings growth of: 372.2 percent, -10.42 percent, 30.30 percent, -14.29 percent, -48.57 percent, 336.4 percent, 6.45 percent, 12 percent, and 483.3 percent. Over the same quarters, Pfizer’s revenue growth was: -15.49 percent, -15.85 percent, -8.66 percent, -6.65 percent, 2.74 percent, 3.84 percent, -3.78 percent, and -0.45 percent.