Is Pfizer Inc. overvalued or undervalued?

As of 29 October 2024, Pfizer Inc. has moved from a risky to a very attractive valuation grade. Given its current P/E ratio of 15, PEG ratio of 0.13, and EV to EBITDA ratio of 11.17, the company appears to be undervalued compared to its peers. For instance, Eli Lilly & Co. has a significantly higher P/E ratio of 40.89, while Merck & Co., Inc. stands at 15.68, indicating that Pfizer's valuation metrics are more favorable.
In terms of performance, Pfizer's stock has underperformed relative to the S&P 500 across multiple time frames, with a year-to-date return of -8.97% compared to the S&P 500's 12.22%. This trend reinforces the notion that Pfizer is undervalued, especially considering its strong dividend yield of 428.12% and solid ROE of 16.06%.