On Monday, Leerink Partners adjusted its price target for Bristol-Myers Squibb Co. (NYSE:BMY), increasing it to $55.00 from the previous $53.00, while maintaining a Market Perform rating on the company's shares. The adjustment follows Bristol-Myers Squibb's recent financial reports and updates on clinical trials.
Leerink's decision comes after Bristol-Myers Squibb reported significant upside in its third-quarter results but provided an EPS guidance increase that was less than the actual third-quarter beat. Additionally, the company shared promising news regarding milvexian, a novel Factor XIa blood thinner, currently under clinical trials.
The firm raised its estimated earnings per share (EPS) for the year 2024 by 20%, from $0.70 to $0.89, which is at the higher end of the company's guided range of $0.75 to $0.95. For the year 2025, Leerink increased its EPS estimate by 3%, from $7.06 to $7.29. Despite the positive adjustments, the analyst forecasts a 13% year-over-year decline in 2026 EPS, attributing this to expected revenue and diabetes royalty erosion.
Leerink's updated price target of $55 is based on a 7.5 times multiple of the new estimated 2025 EPS of $7.29, but also considers the anticipated decline in 2026 EPS, which is reflected in an 8.7 times multiple of the estimated $6.33 EPS for that year.
The firm has reiterated its Market Perform rating on Bristol-Myers Squibb shares, indicating a neutral stance on the stock's outlook. The updated financial model and the rationale behind the maintained rating have been detailed in Leerink's report.
In other recent news, Bristol-Myers Squibb (BMS) has reported a significant 20% increase in third-quarter earnings, largely due to robust growth in its portfolio revenues. The company also revised its full-year 2024 revenue growth projection to around 5% from the previous estimate of approximately 4%, a change driven by strong performance in cell therapy, heart failure drug Camzyos, and its legacy business.
BMS has also acquired Karuna Therapeutics (NASDAQ:KRTX), an initiative aimed at enhancing long-term growth, with ongoing trials in schizophrenia and Alzheimer's. In addition to these developments, BMS has initiated three Phase 3 studies in 2024 and plans to present Phase 1 data for CD19 NEX-T cell therapy.
BMO Capital Markets has adjusted its outlook on BMS, increasing the price target to $57 from the previous $53 while maintaining a Market Perform rating on the stock. This adjustment follows BMS's third-quarter results for 2024 and its revised full-year guidance. Despite the positive signs, BMO Capital remains cautious, opting to wait for further confirmation of the company's growth trajectory in subsequent quarters.
Furthermore, BMS's Phase 3 EMERGENT-4 and EMERGENT-5 trials have shown sustained improvements in schizophrenia symptoms over a 52-week period with COBENFY treatment. These results, along with the FDA approval of Cobenfy, a novel schizophrenia treatment, underscore the company's commitment to growth and innovation. These are some of the recent developments shaping the trajectory of Bristol-Myers Squibb.
InvestingPro Insights
Recent data from InvestingPro adds context to Leerink Partners' analysis of Bristol-Myers Squibb. The company's market capitalization stands at $110.17 billion, reflecting its significant presence in the pharmaceutical industry. BMY's P/E ratio (adjusted) for the last twelve months as of Q3 2024 is 16.74, which aligns with Leerink's forward-looking EPS estimates.
InvestingPro Tips highlight BMY's strong dividend history, having maintained dividend payments for 54 consecutive years and raised them for the past three. This consistent dividend performance, coupled with a current dividend yield of 4.42%, may appeal to income-focused investors despite the projected EPS decline in 2026 mentioned by Leerink.
The company's revenue growth of 5.56% over the last twelve months and a robust gross profit margin of 75.87% underscore its financial health, supporting Leerink's positive EPS adjustments for 2024 and 2025. However, the InvestingPro Tip noting that net income is expected to drop this year aligns with the analyst's cautious stance and Market Perform rating.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Bristol-Myers Squibb, providing a broader perspective on the company's financial outlook and market position.
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