Pfizer Inc. (NYSE:PFE) said on Monday that it has abandoned the plan of splitting into two companies and the decision wouldn’t have any impact on its financial outlook for 2016.
Pfizer shares fell more than 1.5 percent in the mid-day trading session on Monday.
An analyst at Sanford Bernstein, Tim Anderson stated in a note that investors were anticipating the U.S. drug maker to step back from the split. ‘’ Where to from here? The company seems likely to leave open its option for a future split-up, but more immediately it may continue hunting for M&A targets,” he said.
The company started openly planning for the potential split a couple of years ago, saying it would operate its established and new medical businesses as separate units and track their progress for 3 years before making a decision. Last month, the company said that it would decide about the split plan by the end of this year.
Pfizer initially considered the split mainly because its patent-protected drugs usually enjoy sales growth, whereas sales in the generics product line typically drops.
Shares of Pfizer rose nearly 6 percent over the past year. The 52-week range of the stock is $28.25-$37.39. The market cap of the company is $205.10 billion, while P/E ratio is 29.91.