Microvast Holdings announces departure of chief financial officer
On Friday, UBS adjusted its outlook on shares of Bristol-Myers Squibb Co. (NYSE:BMY), reducing the price target on the pharmaceutical company's shares to $43.00 from the previous $47.00, while maintaining a Neutral rating. The adjustment reflects a more conservative stance on the company's upcoming second-quarter earnings, with particular attention to the expected impact of higher costs and specific drug sales performances.
The firm anticipates that Bristol-Myers Squibb will align with consensus revenue estimates for the second quarter of 2024. However, sales forecasts for certain drugs such as Zeposia and Sotyktu have been lowered by 14% and 21% respectively, and Orencia by 2%. These decreases have been somewhat balanced by a projected 25% increase in Camzyos sales and a 4% rise for Yervoy.
Despite these sales adjustments, UBS predicts a 6% lower earnings per share (EPS) for Bristol-Myers Squibb, factoring in higher operational costs for the quarter and an In-Process Research and Development (IPR&D) impact of $95 million, which is equivalent to $0.04 per share. This forecast suggests that the consensus has not fully accounted for these factors, which could potentially lead to a technical revision of the company's guidance for the year.
Investor sentiment towards Bristol-Myers Squibb remains cautious, with many taking a wait-and-see approach until the company discloses the impact of the Inflation Reduction Act (IRA) on Eliquis, expected on September 1. UBS also notes that expectations for key growth drivers may be overly optimistic and may require adjustment for the company's stock to reflect potential growth.
The revised $43 stock price target is based on a lower 2025 estimated Price to Earnings (P/E) valuation of 6.2 times, down from 6.8 times. This valuation is supported by a discounted cash flow (DCF) analysis and takes into account the slower ramp-up of key growth drivers, such as Abecma, Zeposia, and Sotyktu, alongside the erosion of revenues from Revlimid and other products losing exclusivity.
In other recent news, Bristol Myers Squibb has made significant strides in its drug development and approval process. The U.S. Food and Drug Administration (FDA) granted approval to the biopharmaceutical company for its combination therapy designed to treat colorectal cancer in patients with a specific genetic mutation. This therapy includes the oral drug Krazati, which became part of Bristol Myers' portfolio following the acquisition of Mirati Therapeutics (NASDAQ:MRTX).
The FDA also granted accelerated approval for Augtyro as a treatment for certain patients with solid tumors. Furthermore, the European Medicines Agency (EMA) has begun reviewing the company's application for a subcutaneous injection form of Opdivo, a medication used in the treatment of multiple types of cancer in adults.
In board-related developments, Bristol Myers Squibb appointed Michael R. McMullen to its Board of Directors, expanding the board to 11 members. On the financial front, the company's Board of Directors approved quarterly dividend payments for both its common and preferred stock.
Citi maintained its Buy rating on Bristol Myers Squibb stocks, citing the company's financial health and the potential of its pipeline. These are recent developments in the company's journey, reflecting its ongoing efforts in drug development and its financial decisions.
InvestingPro Insights
As Bristol-Myers Squibb Co. (NYSE:BMY) gears up for its upcoming earnings report, recent data from InvestingPro provides a nuanced perspective on the company's financial health and market position. With a market capitalization of $82.67 billion, the pharmaceutical giant shows a mixed bag in terms of financial metrics.
Notably, the company's revenue in the last twelve months as of Q1 2024 stood at $45.53 billion, with a slight quarterly revenue growth of 4.66%. Despite a negative overall revenue growth of -0.68%, the gross profit margin remains strong at 76.03%, underscoring the company's ability to maintain profitability in operations.
InvestingPro Tips highlight that Bristol-Myers Squibb has been a steady dividend payer, maintaining payments for 54 consecutive years, which is reflected in its current dividend yield of 5.89%. Additionally, the company's valuation implies a strong free cash flow yield, which may appeal to investors seeking income-generating stocks.
With management actively buying back shares and the stock trading near its 52-week low, some investors might view this as an opportune entry point. For those interested in deeper analysis and more tips, InvestingPro offers a host of additional insights; there are 7 more InvestingPro Tips available for Bristol-Myers Squibb at https://www.investing.com/pro/BMY. To enhance your investment research, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.