I would borrow with such low i_老虎社区_美港股上老虎

VamX
2021-08-27

I would borrow with such low interest 🤭

Why Is Pfizer Borrowing $1 Billion When Its Cash Stockpile Totals Nearly $22 Billion?

There are several good potential reasons for the move.

Why Is Pfizer Borrowing $1 Billion When Its Cash Stockpile Totals Nearly $22 Billion?

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The company reported a cash stockpile of nearly $22 billion in its second-quarter update. However, it recently announced that it's borrowing $1 billion. In this <i>Motley Fool Live</i> video <b>recorded on Aug. 18, 2021</b>, Motley Fool contributors Keith Speights and Brian Orelli discuss why the big drugmaker decided to borrow money when it already has plenty of cash on hand.</p>\n<p><b>Keith Speights:</b> We're talking about Pfizer a little bit there. At the end of the second quarter, Pfizer's cash position totaled $21.7 billion, a pretty hefty cash stockpile there. With sales from its COVID-19 vaccine and other products continuing to pour in, it's likely, if not a certainty, that Pfizer has even a greater cash stockpile now than it did at the end of the second quarter. But the company just announced that it's issuing a $1 billion sustainability bond.</p>\n<p>Basically, Pfizer's borrowing more money, even though it has a huge cash stockpile that it could tap into, at least in theory. Some investors might be puzzled by this, but big companies like Pfizer don't make moves that don't make sense usually anyway.</p>\n<p>Brian, why is Pfizer issuing bonds when it has a big cash stockpile that it could potentially tap? is this a smart move for the company?</p>\n<p><b>Brian Orelli:</b> First and foremost, it's probably because the money is so cheap. Pfizer's only paying 1.75% interest rate on this 10-year bond/ I wish my bank would be convinced that I was so creditworthy, that I could borrow money at 1.75% for 10 years. I would certainly do it. Certainly, I can think of ways to invest $1 billion at <a href=\"https://laohu8.com/S/AONE.U\">one</a> point so I would pay back 1.75%.</p>\n<p>Pfizer says it's going to use the capital for COVID. I'm quoting here, \"COVID vaccine research and development capital expenditures in connection with the manufacturer and distribution of COVID-19 vaccines and other projects at Pfizer or any of its subsidiaries that have environmental or social benefits.\" I think that's the social part of the bond.</p>\n<p>I think probably the biggest issue here is, where is that $21.7 billion that Pfizer has in cash on its books? If it's spending money in the U.S. to advance its manufacturing of its vaccine but the cash is overseas, then it has to pay taxes to bring that cash back into the U.S. and the interest that it's paying on the bond is probably substantially less than the taxes it would pay to bring that money from overseas back into the U.S. I think it's just a money play there in terms of making the best financial decision for shareholders.</p>\n<p><b>Speights:</b> It might seem unusual for a company that has that much money to go borrow money. But Brian, you just laid out several reasons why Pfizer might find it beneficial to do this. You'll probably see other companies make similar moves. They have plenty of cash that they could use, but they end up borrowing some because there are just some financial reasons why it makes sense for them to do it.</p>","source":"fool_stock","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Why Is Pfizer Borrowing $1 Billion When Its Cash Stockpile Totals Nearly $22 Billion?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nWhy Is Pfizer Borrowing $1 Billion When Its Cash Stockpile Totals Nearly $22 Billion?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-08-27 19:28 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.fool.com/investing/2021/08/27/why-is-pfizer-borrowing-1-billion-when-its-cash-st/><strong>Motley Fool</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Pfizer (NYSE:PFE) isn't hurting for cash. The company reported a cash stockpile of nearly $22 billion in its second-quarter update. However, it recently announced that it's borrowing $1 billion. In ...</p>\n\n<a href=\"https://www.fool.com/investing/2021/08/27/why-is-pfizer-borrowing-1-billion-when-its-cash-st/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"PFE":"辉瑞"},"source_url":"https://www.fool.com/investing/2021/08/27/why-is-pfizer-borrowing-1-billion-when-its-cash-st/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"2162042476","content_text":"Pfizer (NYSE:PFE) isn't hurting for cash. The company reported a cash stockpile of nearly $22 billion in its second-quarter update. However, it recently announced that it's borrowing $1 billion. In this Motley Fool Live video recorded on Aug. 18, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss why the big drugmaker decided to borrow money when it already has plenty of cash on hand.\nKeith Speights: We're talking about Pfizer a little bit there. At the end of the second quarter, Pfizer's cash position totaled $21.7 billion, a pretty hefty cash stockpile there. With sales from its COVID-19 vaccine and other products continuing to pour in, it's likely, if not a certainty, that Pfizer has even a greater cash stockpile now than it did at the end of the second quarter. But the company just announced that it's issuing a $1 billion sustainability bond.\nBasically, Pfizer's borrowing more money, even though it has a huge cash stockpile that it could tap into, at least in theory. Some investors might be puzzled by this, but big companies like Pfizer don't make moves that don't make sense usually anyway.\nBrian, why is Pfizer issuing bonds when it has a big cash stockpile that it could potentially tap? is this a smart move for the company?\nBrian Orelli: First and foremost, it's probably because the money is so cheap. Pfizer's only paying 1.75% interest rate on this 10-year bond/ I wish my bank would be convinced that I was so creditworthy, that I could borrow money at 1.75% for 10 years. I would certainly do it. Certainly, I can think of ways to invest $1 billion at one point so I would pay back 1.75%.\nPfizer says it's going to use the capital for COVID. I'm quoting here, \"COVID vaccine research and development capital expenditures in connection with the manufacturer and distribution of COVID-19 vaccines and other projects at Pfizer or any of its subsidiaries that have environmental or social benefits.\" I think that's the social part of the bond.\nI think probably the biggest issue here is, where is that $21.7 billion that Pfizer has in cash on its books? If it's spending money in the U.S. to advance its manufacturing of its vaccine but the cash is overseas, then it has to pay taxes to bring that cash back into the U.S. and the interest that it's paying on the bond is probably substantially less than the taxes it would pay to bring that money from overseas back into the U.S. I think it's just a money play there in terms of making the best financial decision for shareholders.\nSpeights: It might seem unusual for a company that has that much money to go borrow money. But Brian, you just laid out several reasons why Pfizer might find it beneficial to do this. You'll probably see other companies make similar moves. They have plenty of cash that they could use, but they end up borrowing some because there are just some financial reasons why it makes sense for them to do it.","news_type":1},"isVote":1,"tweetType":1,"viewCount":273,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"EN","currentLanguage":"EN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":33,"xxTargetLangEnum":"ORIG"},"commentList":[],"hasMoreComment":false,"orderType":2}