Pfizer’s share price rises 2 percent on positive news from pharma company

Pfizer Inc.’s share price rose more than 2 percent on Friday on the back of positive news from the world’s largest drugmaker.

The company announced a $14.6 billion deal to sell its consumer health business to Johnson & Johnson. As a result, Pfizer’s market cap surged more than $5 billion, helping to propel it higher.

Pfizer is also going to receive $3.2 billion as a result of additional milestone payments and deductions for tax purposes. The transaction will leave Pfizer with an enterprise value of about $17 billion.

In a note to clients on Friday, analysts at BMO Capital Markets said it rates Pfizer a “outperform,” its highest rating, with a price target of $50.

BMO analyst David Maris said that the company’s fundamentals remain strong. Despite uncertainty over new safety concerns regarding its top drug, Viagra, which drove down its stock in October, the analysts expect pharmaceutical revenue growth to accelerate this year.

In a recent note to clients, BMO wrote that “despite recent headwinds we see positive upcoming catalysts that will drive share price appreciation,” referring to Viagra and other problems related to the company’s pipeline.

The company is also expected to benefit from “very strong fundamentals in the branded biopharma market,” that analysts said are “being supported by an improving macro environment, a healthy pipeline and a clearly articulated strategy to reduce debt, unlock value from its infant-formula business and divest non-core assets.”

Read the full story from BMO Capital Markets.

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