Bristol-Myers Squibb Company (NYSE:BMY ) Bernstein 41st Annual Strategic Decisions Conference May 28, 2025 3:30 PM ET Company Participants Chris Boerner - Chief Executive Officer & Chairman Conference Call Participants Courtney Breen - Bernstein Courtney Breen Fantastic. Hi, everyone.
Bristol Myers Squibb's much needed correction has brought the stock back to earth, nearer to its 1Y means while triggering the expanded forward dividend yields. Its dividend investment thesis appears safe as well, as observed in the management's recent payout hike and the still rich cash flows despite the ongoing patent cliff impact. This is on top of the raised FY2025 guidance, given the accelerating Growth Portfolio revenue profile compared to a year ago, thanks to the M&A activities and intensified R&D efforts.
Zacks.com users have recently been watching Bristol Myers (BMY) quite a bit. Thus, it is worth knowing the facts that could determine the stock's prospects.
Bristol-Myers Squibb Company appears deeply undervalued, despite business headwinds and revenue declines from legacy products facing generic competition. The market is already pricing in revenue and EPS declines, but current valuation multiples—like a forward P/E below 7x—are excessively discounted. Even with conservative assumptions of 5% annual revenue decline and no terminal growth, fair value estimates show over 20% upside potential.
I reiterate my buy rating on Bristol-Myers, seeing significant undervaluation despite persistent weak technicals and sector underperformance. BMY's strong earnings beats, high free cash flow yield, and nearly 6% dividend make it a compelling income play, even amid pipeline concerns. Valuation is attractive: a sub-7x forward P/E and high dividend yield more than discount muted growth and generic competition risks.
Despite socio-economic challenges and pressure from the generic versions of Revlimid and Abraxane, Bristol-Myers Squibb Company's financial position continues to improve. It raised its 2025 diluted EPS guidance from $6.55-$6.85 to $6.7-$7, as well as revenue expectations from $45.5 billion to $45.8-$46.8 billion. Bristol-Myers Squibb's key franchises remain oncology and cardiovascular, primarily due to the strong performance of Opdivo, Camzyos, and Reblozyl.
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Earnings season saw strong reports from Microsoft, Apple, Meta, and Amazon, boosting the S&P 500 by 2.75% and the Nasdaq by 2.82%. The Dividend Harvesting Portfolio gained 1.98% this week, with a total return of 23.42% and forward dividend income reaching $2,195.04. Added to positions in Bristol-Myers Squibb, Pfizer, and BP, focusing on undervalued stocks with strong dividend yields and growth potential.
When markets get choppy, smart investors often seek refuge in pharmaceutical stocks. These companies typically offer consistent cash flows, essential products, and solid dividends regardless of economic conditions.
Zacks.com users have recently been watching Bristol Myers (BMY) quite a bit. Thus, it is worth knowing the facts that could determine the stock's prospects.