Pete Najarian: Pfizer is not overpriced despite a 65% gain this year

Shares of Pfizer Inc (NYSE: PFE) gained 3.0% on Wednesday after the pharmaceutical giant secured U.S. FDA approval for its oral COVID-19 antiviral, Paxlovid.

Najarian sees a lot more upside in Pfizer

Including today’s price action, PFE is now up nearly 65% year-to-date, but Pete Najarian says the stock has a lot more room to run. On CNBC’s “Halftime Report”, he said:

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I’m going to hold on to this name. It’s not overpriced just because it’s gone up as much as it has. I think this is one of those names that absolutely has a lot more room to the upside.

Najarian agrees that Pfizer was a notable pandemic beneficiary but said its strong fundamentals make it a good pick even outside of the COVID crisis.

It’s been a really long-term hold. I own it not just because of COVID, but I think it’s a really quality company when you look at their free cash flow and all the different things in their balance sheet.

Najarian is bullish on the healthcare industry at large but withdrew from his position in Johnson & Johnson this morning.

CDC is expected to approve Paxlovid shortly

The clinical trials showed Pfizer’s oral pill to be 90% effective in preventing hospitalisation and death. The Food and Drug Administration has approved it for patients aged 12 and above with mild to moderate COVID-19.

Approval from the CDC is expected to follow shortly. Pfizer’s antiviral is the first approved oral treatment for COVID-19. According to CEO Albert Bourla, Paxlovid could be available in the United States as soon as this weekend.

In related news, Omicron has become the dominant variant in the U.S. in less than a month, accounting for about 73% of the new COVID cases. Last week, Pfizer said it will acquire Arena Pharmaceuticals for $6.7 billion.