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Princeton, New Jersey-based Bristol-Myers Squibb Company (BMY) is one of the leading biopharmaceutical companies focused on developing treatments for diseases like cancer, inflammatory, immunologic, cardiovascular, and fibrotic diseases. With a market cap of $96.6 billion, Bristol-Myers’ operations span various countries in the Americas, Europe, Asia, and internationally.
The pharma giant has significantly underperformed over the past year. The BMY stock is down 21.7% over the past 52-week period, while the S&P 500 Index ($SPX) has rallied 19%. In 2024, shares of Bristol-Myers have dipped 6.1%, while the SPX has returned 14.2% on a YTD basis.
Zooming in further, BMY has also lagged behind the Nasdaq Pharmaceuticals ETF’s (FTXH) 8.4% gains on a YTD basis and 9.6% returns over the past 52 weeks.
Despite the weak price momentum this year, shares of Bristol-Myers Squibb surged 11.4% on July 26 following its solid Q2 earnings report, generating an EPS of $2.07, surpassing consensus estimates by 26.2%. This success was driven by an 18% revenue growth in its growth portfolio, including newer drugs like Opdivo, Yervoy, and Opdualag, fueling investor optimism. This strong performance marked a turnaround from a challenging start to the fiscal year when the company reported a Q1 loss per share of $4.40.
However, for the current fiscal year, ending December, analysts expect Bristol-Myers EPS to decline 89.6% to $0.78 on a diluted basis. The company has a history of surpassing consensus EPS estimates in its quarterly earnings reports, which is remarkable.
Among the 22 analysts covering the BMY stock, the consensus rating is “Hold.” That’s based on four “Strong Buy” ratings, one “Moderate Buy,” 16 “Holds,” and one “Strong Sell.”
This configuration has been consistent over the past months.
On July 29, analyst Terence Flynn from Morgan Stanley (MS) maintained a “Sell” rating with a price target of $37. Meanwhile, Barclays adjusted its stance, downgrading BMY stock from an “Equal-weight” to an “Underweight” rating, maintaining a price target of $41. The analyst fears Bristol-Myers’s growth is not sustainable. With unclear long-term earnings guidance and reliance on one-off gains, the stock’s recent boost from legacy products seems shaky. The analyst also flagged upcoming patent losses and market uncertainties as reasons for caution.
However, BMY’s mean price target of $51.42 suggests a potential upside of 6.7% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
