PFE’s $9.77 billion dividend payout exceeded free cash flow by $690 million last year, raising sustainability concerns.
Pfizer’s 7.27% dividend yield, supported by a 53% adjusted payout ratio, faces pressure after free cash flow fell $690 million short of dividends paid in 2025. Operating cash flow reached $11.71 billion, but $2.63 billion in capex left free cash flow at $9.08 billion against $9.77 billion in payouts.
The company’s $7.2 billion cost-saving target from the Seagen acquisition is critical, as net debt-to-EBITDA stands at 3.26x. Adjusted EPS of $3.22 covered the $1.72 dividend, but COVID franchise declines—Comirnaty down 59% and Paxlovid down 63% in Q1 2026—add uncertainty.
PFE stock trades at $24.37, with management maintaining its 351st consecutive quarterly dividend despite revenue headwinds.