Best COVID-19 vaccine stock to buy in June: Pfizer

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on May 26, 2021
  • The global stock market has rebounded sharply from 2020 selloff during the early days of the COVID-19 pandemic
  • Healthcare companies rushed to develop vaccines last year and have sent out more than 1.7 billion doses.
  • The European Alone is targeting at least 1 billion vaccinations by September.

On Tuesday, Reuters reported that the EU is targeting more than 1 billion COVID-19 shots by September. This is a huge figure considering that since the vaccine roll-outs began earlier this year, only 266 million vaccinations have been administered in the European Union. The US tops the list with over 287 million. 

Globally, the tally stands at 1.74 billion vaccinations with Asia alone accounting for 900 million doses. The math suggests more than 5 billion vaccinations have yet to be administered. This means that some COVID-19 vaccine manufacturers could be set for a significant windfall in the coming quarters.

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But what are the top COVID-19 stocks to buy in June and beyond?

Pfizer offers compelling value

Shares of Pfizer Inc. (NYSE:PFE) are up just 16.44% since it announced its COVID vaccine with BionTech SE ADR (NASDAQ:BNTX) late last year. In comparison, BionTech stock has gained nearly 160% over the same period. Another COVID vaccine manufacturer, Moderna Inc. (NASDAQ:MRNA) is up 158% over the same time period.

From a valuation perspective, Pfizer shares also trade at a more lucrative P/E ratio of just 19.76. This compares to Moderna’s astronomical P/E of 138.87 and BionTech’s equivalent of 36.07. Pfizer stock also offers an attractive dividend yield of 4.01%. Moderna and BionTech do not offer shareholders a dividend. 

Another vaccine manufacturer that has shipped millions of doses is Johnson & Johnson (NYSE:JNJ). JNJ stock offers a less attractive dividend yield compared to Pfizer at 2.38% so PFE stock is a superior pick.

Source-TradingView

Technical overview

Technically, shares of Pfizer appear to have recently pulled back from an ascending channel to drop below the $40.00 mark. The stock has now crossed to oversold levels of the 14-hour RSI in the 60-min chart. PFE stock has also fallen below the 100-hour moving average for only the second time since the start of March.

This puts the company’s shares in a strong position to bounce back. The bulls will be targeting short-term profits at around $41.01 and $43.02. Key support levels can be found at around $37.03 and $34.96.

The Bottom line: PFE stock is the best buy among COVID vaccine stocks

Based on our analysis, Pfizer is the most compelling COVID vaccine stock to buy based on valuation multiples. And with more than 5 billion vaccinations still to be shared among the leading providers, the stock stands to benefit even more in the coming quarters. Technically, shares of the company also look poised for a short-term rebound after the recent pullback.

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