Pfizer is one of the world's largest pharmaceutical firms, with annual sales close to $50 billion (excluding COVID-19 product sales). While it historically sold many types of healthcare products and chemicals, now prescription drugs and vaccines account for the majority of sales. Top sellers include pneumococcal vaccine Prevnar 13, cancer drug Ibrance, and cardiovascular treatment Eliquis. Pfizer sells these products globally, with international sales representing close to 50% of total sales. Within international sales, emerging markets are a major contributor.

The major indices have put recent stock weakness into hibernation, as the S&P 500 (SPX), Nasdaq, and Nasdaq 100 (QQQ) have jumped to all-time highs (ATHs). The false breakout by the SPX was nothing more than a back test of the 50-day average, while pullbacks by the Nasdaq and QQQs represented back tests of breakout zones from mid-May. On Wednesday, the SPX rose 1.2%, and the Nasdaq and QQQs gained 2%. It was clearly a risk-on day, with Technology up 2.3%, Communication Services gaining 1.2%, Industrials adding 1%, and Materials rising 0.7%. Weakness was seen in defensive Utilities, off 0.6%, and Staples, down 0.2%.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.

The technical scorecard for stocks remains bullish, as indices at new all-time highs (and others missing by only a few points) are actually lagging advance/decline lines that have led price to new highs. Historically, when market breadth leads price, it has been bullish when looking out six to 12 months.