Unusual Options Activity Signals Bullish Sentiment for Pfizer Shares

A surge in derivatives trading, rather than a major product announcement, has placed Pfizer in the spotlight. This activity coincides with the pharmaceutical giant’s stock reaching a five-week high of approximately $26.10. The shares also traded ex-dividend on January 23, 2026, adding another layer to the current market dynamics.

Strategic Portfolio Shifts Underpin Movement

Beyond the options market, Pfizer has been actively restructuring its portfolio. The company generated $1.9 billion from the sale of its stake in ViiV Healthcare, a specialist in HIV treatments. Concurrently, it entered into a licensing agreement with Novavax, securing rights to the Matrix-M adjuvant technology. The deal involves a $30 million upfront payment, with potential milestone payments reaching up to $500 million.

Call Option Volume Spikes Dramatically

Market data reveals a significant spike in bullish bets on January 22. A total of 446,836 call options changed hands, representing a 114% increase over the typical daily volume of around 208,000 contracts. Traders showed particular interest in weekly calls with a $27 strike price expiring January 30, as well as March calls with a $30 strike.

This sentiment is underscored by a put/call ratio of just 0.17, indicating overwhelmingly bullish positioning. Implied volatility also edged higher, rising nearly two points to 25.07%, suggesting traders are anticipating price movement ahead of upcoming corporate events.

Should investors sell immediately? Or is it worth buying Pfizer?

Dividend Yield and Valuation Metrics Attract Attention

Shareholders of record as of January 22 are set to receive a quarterly dividend payment of $0.43 per share on March 6. Annualized, this payout amounts to $1.72, translating to a dividend yield of roughly 6.6%.

From a valuation perspective, Pfizer appears potentially undervalued. Its price-to-earnings (P/E) ratio of 15.1 sits notably below the industry average of 19.6. Discounted cash flow models suggest a fair value estimate of $56.53 per share, implying a potential undervaluation of over 50%. Analyst price targets currently range from $27.88 to $29.33, with Jefferies maintaining a more bullish target of $34.

Forthcoming Earnings Report Seen as Key Catalyst

All eyes are now on the company’s fourth-quarter 2025 results, scheduled for release on February 3. Analysts are projecting adjusted earnings per share (EPS) of $0.58. This compares to the third quarter’s reported adjusted EPS of $0.87 on revenue of $16.65 billion.

Looking further ahead, management has provided guidance for the full 2026 fiscal year. The company anticipates revenue in the range of $59.5 to $62.5 billion, a slight decrease from the approximately $62 billion expected for 2025. Adjusted EPS for 2026 is forecast to be between $2.80 and $3.00. The aggressive accumulation of call options may signal that some market participants are betting on a positive earnings surprise.