I own Pfizer(PFE) in my retirement account bought about a year ago around $30. The last few months have not been pretty, with Pfizer first sliding over Merck’s woes with Vioxx and falling even further when safety worries surfaced about Celebrex this week.
Assuming Celebrex sales fall to zero and legal liabilities are limited, Pfizer may be a buy at these levels (P/E around 12, dividend yield around 2.9%). However, I’ve learnt over the years (rather painfully) not to catch falling knives. So, I will postpone any consideration of buying Pfizer till the issues surrounding Celebrex becomes clearer.
Pfizer and many other stocks have taught me about the high risk involved in holding individual stocks. Fortunately, PFE is only about 2% of my portfolio, so the damage has been limited so far. Check out these articles at marketwatch.com and Money magazine for more discussion on this issue.
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