The Business Model is Evil, But Pfizer Is a Buy Below $18 a Share

Emotion is the enemy to the trader. As a stock picker, you've got to set aside personal judgments about a company if you want to maximize your performance. Clearly, the way to generate the highest returns is to focus on generating the highest returns...not by focusing on whether you agree with everything the company does with its business.

So it was a few weeks ago, when I wrote about how I thought Altria (MO) looks like a great investment and intermediate-term trade here around $20 or so. The dividend is safer here than certainly it is at any bank -- I mean, ANY bank, even Goldman (GS), even Citi (C)...those dividends there aren't nearly as safe as they are at Altria...where millions of people each month around the world are raising themselves out of the immediate threat of death from starvation and poverty and violence and instead choosing a slower means of death from nicotine addiction. It's a horrible business. But it is a good investment here.

So too, must we overlook the evils of the industry that Pfizer operates in, as we see this stock now -- at long last -- looking like a pretty safe long-term investment here. I'm sure not okay with the idea that we use public funds to research and create new drugs that private companies like Pfizer then lock up the rights to and then start paying doctors to prescribe the drug and start brainwashing the masses into believing that whatever actual ailment the drug treats is probably in need of treatment in their life. And then the industry convinces the government to pay for the treatment/prescription/whatever.

So taxpayers create the drug and taxpayers buy the drug while Pfizer and its shareholders get to keep all the profits from the drug.

As a US citizen and member of the media, the corrupted business model of the prescription drug industry makes me sick (pun intended, yeah). As an investor/trader, with Pfizer down more than 60% from its highs and now with a yield of 7% (that again is much safer than any financials stock's yield), I think there's a great opportunity to make some good money.

Here's another way of thinking about Altria and Pfizer and their outsized yields right now -- Treasuries pay less than half the yield on these two stocks...

Heck, I'd almost doubt the US government's ability to pay that money back before I'd doubt Altria and Pfizer cutting dividends in the next three or five years.

Pfizer's (PFE) a buy below $18.

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