Pfizer (PFE) -0.06%
CEO Jeff Kindler said in this interview with The Financial Times that the company is open to acquisitions, big or small.
Pfizer’s cholesterol drug Lipitor, with sales of $12 billion a year, is expected to encounter stiff competition in 2011 when generic versions hit the market. Kindler said any new acquisitions will be designed to “generate new and diverse sources of revenue growth and cost structures to position us to be strong after Lipitor.”
The article also raises the possibility of Pfizer acquiring Amgen (AGMN) to strengthen its biological medicines by purchasing Amgen, which has developed a range of promising medicines.
Walgreen (WAG) +5.05%
Walgreen said that sales increased 10.8 percent in December and same-store sales rose 4.9 percent in December in the face of challenging retail headwinds. Comparable pharmacy sales increased 8.5 percent in December. The company said that comparable pharmacy sales were negatively impacted by 2.5 percentage points due to generic drug introductions. Meanwhile, competitor Rite Aid said same-store sales fell 0.2 percent.
U.S. drugstores are feeling the effects of the recession as more customers seek cheaper alternatives to prescriptions and other medical items. In addition, prescription drug sales are slowing as consumers skip doses of medicine to reduce their medical costs.
Walgreen is a leader in what is generally viewed as a lucrative industry. The company’s strong cash flow generation should help them remain active on the acquisition front, adding smaller, less traditional businesses to the mix until a better opportunity arises. Walgreen’s strong sales numbers are encouraging and the company appears to be well-positioned for growth once the economy recovers.
General Electric (GE) -2.58%
GE Capital, the lending arm of General Electric, plans to raise $10 billion in the biggest offering of debt backed by the FDIC since the program began. The sale will be split between $2 billion of two-year notes, $5.5 billion of 3.5-year debt and $2.5 billion of 18-month securities.
Today’s offering would put GE Capital halfway toward its goal to “pre-fund” $45 billion in debt that the company plans to refinance this year. GE Capital sold about $12.5 billion of FDIC-backed notes last year.
AT&T (T) -3.37%
Bernstein Research analysts downgraded AT&T to neutral today. The analyst report acknowledges that the company is more recession-resistant than most, but the U.S. recession and saturation of the wireless market will make it tougher to find new mobile customers and will accelerate losses of home phone customers.
AT&T is solidly profitable and recent cost cutting should boost profits over the next couple of years. The company’s debt load remains very manageable relative to the firm’s cash flow and their nice dividend (yielding 5.77%) is in no danger.
Quick Hits
- Obama Said to Push for Tax Cuts in U.S. Stimulus Plan
- Investing Experts Urge ‘Do as I Say, Not as I Do’
Peter Lazaroff, Junior Analyst
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