Buy Pfizer

Also: analysts' opinions on Black & Decker and AT&T

Pfizer (PFE ): Maintains 5 STARS (buy)

Analyst: Herman Saftlas

Pfifzer posted adjusted first-quarter earnings per share of 52 cents vs. 40 cents, a penny above S&P's estimate for stand-alone Pfizer. Revenues rose 47%, boosted by the Pharmacia acquisition, a 19% gain for sales of Lipitor, and a 16% gains for Norvasc. S&P expects Pfizer to meet its 2004 guidance of $54 billion in revenues and earnings per share of $2.13, driven by robust growth in key drugs and new products, and merger savings of $3.4 billion. Despite the recent advance, S&P still sees Pfizer as undervalued by about 10% relative to the overall market and big pharma price-earnings ratios. S&P's 12-month target price remains $43, based on blend of forward p-e and discounted cash-flow valuation models.

Black & Decker (BDK ): Maintains 5 STARS (buy)

Analyst: Amrit Tewary

Black & Decker posted first-quarter earnings per share from continuing operations of 93 cents, vs. 55 cents, a penny above S&P's estimate and in line with the company's recent guidance of 90 cents to 93 cents. Sales of $1.09 billion, representing a 16% increase over a year ago, were in line with S&P's forecast. Excluding the effects of acquisitions and foreign currency translations, sales were up 5%, also in line with S&P's expectations of mid-single digit organic sales growth. The company sees second-quarter earnings per share of $1.20 to $1.25, and full-year 2004 earnings per share of $4.70 to $4.85.

AT&T (T ): Maintains 5 STARS (buy)

Analyst: Todd Rosenbluth

With MCI expected to emerge from bankruptcy today and Sprint reporting combined results for the first time in years, S&P thinks the long-distance market is in the spotlight today. Despite the Baby Bells' presence and pricing competition, AT&T remains the market share leader in combined local and long-distance service. S&P believe the company's network strength and its breadth of services, including VoIP, have helped offset competition. AT&T reports first-quarter results on Apr. 22, and S&P believes the shares trades at an appealing discount to S&P's 12-month target price of $25.

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