Bristol-Myers Squibb: Turnaround Expected

seekingalpha03-08

Bristol-Myers Squibb might have seen a price decline over the past year, but it now boasts of a superior dividend yield and competitive P/E ratio compared to peers.After a revenue setback on the ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2417438227?lang=en_US&edition=fundamental","thumbnail":"https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1617236488/image_1617236488.jpg","is_english":true,"pubTime":"2024-03-08 03:32","share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","id":"2417438227","market":"hk","top_or_hot":-1,"title":"Bristol-Myers Squibb: Turnaround Expected","media":"seekingalpha","content":"<div>\n<p>Bristol-Myers Squibb might have seen a price decline over the past year, but it now boasts of a superior dividend yield and competitive P/E ratio compared to peers.After a revenue setback on the ...</p>\n\n<a href=\"https://seekingalpha.com/article/4676701-bristol-myers-squibb-turnaround-expected\">Source Link</a>\n\n</div>\n","source":"seekingalpha","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>Bristol-Myers Squibb: Turnaround Expected</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\">\nBristol-Myers Squibb: Turnaround Expected\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-03-08 03:32 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4676701-bristol-myers-squibb-turnaround-expected><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Bristol-Myers Squibb might have seen a price decline over the past year, but it now boasts of a superior dividend yield and competitive P/E ratio compared to peers.After a revenue setback on the ...</p>\n\n<a href=\"https://seekingalpha.com/article/4676701-bristol-myers-squibb-turnaround-expected\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU1066051498.USD","symbol_name":"HSBC GIF GLOBAL EQUITY VOLATILITY FOCUSED \"AM2\" (USD) INC","start_time":0,"source_url":"https://seekingalpha.com/article/4676701-bristol-myers-squibb-turnaround-expected","article_id":"2417438227","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1617236488/image_1617236488.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2417438227","pubTimestamp":1709839937,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Bristol-Myers Squibb might have seen a price decline over the past year, but it now boasts of a superior dividend yield and competitive P/E ratio compared to peers.After a revenue setback on the paten","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU1066051498.USD":"HSBC GIF GLOBAL EQUITY VOLATILITY FOCUSED \"AM2\" (USD) INC","BK7095":"多种金属与采矿","LU1066053197.SGD":"HSBC GIF GLOBAL EQUITY VOLATILITY FOCUSED \"AM3\" (SGDHDG) INC","LU0882574055.USD":"富达全球健康医疗A ACC","LU0122379950.USD":"贝莱德世界健康科学A2","LU0868494617.USD":"UBS (LUX) EQUITY SICAV - US TOTAL YIELD SUSTAINABLE \"P\" (USD) ACC","LU0061475181.USD":"THREADNEEDLE (LUX) AMERICAN \"AU\" (USD) ACC","IE0002141913.USD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"I2\" (USD) ACC","PFE":"辉瑞","LU1074936037.SGD":"JPMorgan Funds - US Value A (acc) SGD","MRTX":"Mirati Therapeutics Inc.","IE00BJJMRZ35.SGD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"I2\" (SGDHDG) ACC","IE00BFTCPJ56.SGD":"Janus Henderson Global Life Sciences A Acc SGD","SG9999001176.USD":"United Global Healthcare Acc USD","LU1571399168.USD":"ALLSPRING GLOBAL LONG/SHORT EQUITY \"IP\" (USD) ACC","LU2242652126.USD":"FIDELITY FUNDS GLOBAL DIVIDENDS PLUS \"A\" (USD) INC","LU0889565916.HKD":"FRANKLIN BIOTECHNOLOGY DISCOVERY \"A\" (HKD) ACC","LU0114720955.EUR":"SUSTAINABLE GLOBAL HEALTH CARE \"A\" INC","RYZB":"RayzeBio, Inc.","SG9999003800.SGD":"Nikko AM Global Dividend Equity Acc SGD-H","SG9999001176.SGD":"UOB UNITED GLOBAL HEALTHCARE \"SGD\" (ACC)","BK4532":"文艺复兴科技持仓","LU1989771016.USD":"东方汇理环球老龄化投资基金 A2 Acc","LU0170899867.USD":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY  \"A\" (USD) ACC","BK4534":"瑞士信贷持仓","IE0009355771.USD":"骏利亨德森环球生命科技A Acc","LU1670710588.SGD":"M&G (LUX) GLOBAL DIVIDEND \"A\" (SGD) ACC","BMY":"施贵宝","PFE.AU":"PANTERA MINERALS LTD","LU0237698245.USD":"富达环球地产基金A","BK4533":"AQR资本管理(全球第二大对冲基金)","BK4007":"制药","LU1670710661.SGD":"M&G (LUX) GLOBAL DIVIDEND \"A\" (SGD) INC","IE00B19Z3B42.SGD":"Legg Mason ClearBridge - Value A Acc SGD","LU0320765992.SGD":"FTIF - Franklin Biotechnology Discovery A Acc SGD","IE00BJT1NW94.SGD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"A2\" (SGDHDG) ACC","BK4566":"资本集团","IE00BBT3K403.USD":"LEGG MASON CLEARBRIDGE TACTICAL DIVIDEND INCOME \"A(USD) ACC","SG9999011175.SGD":"Nikko AM Global Dividend Equity Dis SGD-H","LU0109394709.USD":"富兰克林生物科技新领域基金A (acc)","LU1261432733.SGD":"Fidelity World A-ACC-SGD","LU0321505868.SGD":"Schroder ISF Global Dividend Maximiser A Dis SGD","BK4535":"淡马锡持仓","LU1670711123.USD":"M&G (LUX) GLOBAL DIVIDEND \"A\" (USD) INC","BK4559":"巴菲特持仓","LU0058720904.USD":"联博国际健康护理基金A","BK4550":"红杉资本持仓","BK4568":"美国抗疫概念","AMGN":"安进","KRTX":"Karuna Therapeutics"},"translate_title":"百时美施贵宝：预期好转","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"AMGN":1,"RYZB":1,"PFE.AU":1,"PFE":1,"MRTX":1,"BMY":1,"KRTX":1},"content_text":"Bristol-Myers Squibb might have seen a price decline over the past year, but it now boasts of a superior dividend yield and competitive P/E ratio compared to peers.After a revenue setback on the patent erosion of its cancer treatment drug, it's now seeing progress in new products and some big existing ones.Its recent acquisitions might be small, but they do have significant growth potential, with two of the three already being revenue generating.The company's revenue forecast for 2024 is positive, and while the non-GAAP EPS is wanting, it might not be so for the corresponding GAAP number.   arlutz73At first glance, there are two positives going on for the eighth largest US-based pharmaceuticals company by market capitalisation, Bristol-Myers Squibb (NYSE:BMY) or BMS for short:  It has a trailing twelve-month [TTM] dividend yield of 4.5%. This is second only to Pfizer (PFE) at 6.4% among peers with a market capitalisation of over USD 100 billion.  Its TTM GAAP price-to-earnings (P/E) ratio of 13.3x is far lower than its peers by a significant margin. Biotech company Amgen (AMGN) has the second lowest P/E and even that’s at 22.5x.  But here’s the rub. In the past year, it’s the only stock among peers to see a price decline (see chart below) save Pfizer, which has fallen by 33.4%. In light of this, here I take a closer look at BMY to determine whether there’s a good fundamental reason for the price decline that has boosted the dividend yield or whether the stock is now overdue a move higher. This is specifically in the context of a 12.2% increase in price following its final quarter (Q4 2023) and full-year 2023 results last month.   Price Chart (Source: Seeking Alpha)Patent erosion affects revenues, but a turnaround is here There has indeed been good reason for stock price weakness on account of its shrinking revenues over 2022 and 2023. The key pain point triggering this trend has been the patent erosion for its cancer treatment Revlimid in March 2022, which has more than halved its revenues between 2021 and 2023. From a high of 27.6% in 2021, the drug’s share in total revenues declined to 21.6% in 2022 and further to 13.5% in 2023. As a result, the company’s total reported revenues for 2023 declined by 2.5%. However, this detracts from progress with other treatments. Revenues ex-Revlimid saw a 7% increase on the year. Further, with Revlimid's declining influence on revenues, even overall growth is already seeing a turnaround. In Q4 2023, the company has already turned a corner with a small almost 1% year-on-year (YoY) growth. Further, BMS is optimistic about growth in 2024. It anticipates revenue growth in “low single digits” this year, which will reverse the revenue contraction from the past couple of years. New products shine There are two reasons why sales can pick up in 2024. The first is progress in new products, which grew by 77% in 2023. The absolute number is still relatively small (see table below), but it’s worth noting that the new product’s share in total revenues has increased from 4.4% in 2022 to ~8% in 2023. This adds to growth in its cancer treatment Opdivo, which saw a 9% revenue increase in 2023. The treatment is important for BMS in that it brought in 11.7% of the revenues as of last year.   Source: Bristol-Myers SquibbInorganic growth possible Looking into the more distant future, BMS can also benefit from three recent acquisitions even though they are small as of now. The biggest of these is Karuna Therapeutics (KRTX), the biopharma company focused on medication for psychiatric and neurological conditions, for USD 14 billion. The second is the oncology treatment company Mirati Therapeutics (MRTX) for USD 4.8 billion. And the third is the radiopharmaceutical therapeutics company RayzeBio (RYZB) for USD 4.1 billion. As of now, their impact on revenue growth is likely to be limited, however. Of the three, Karuna and Mirati are revenue generating, while RayzeBio is not. The combined revenues for the ones that are revenue generating as of 2022 was at USD 13.1 million. This is a tiny fraction of BMS's total revenues for the year, indicating that they will not impact sales in any meaningful way. Still, there’s promise here, especially with Mirati’s five-year compounded annual growth rate [CAGR] of 32.2%. Next, BMS intends to partly fund these acquisitions with debt, so a look at its balance sheet is required here. The company’s total debt-to-assets ratio looks alright at 0.43x as of 2023. Even if all three purchases were made entirely with debt, the needle doesn’t move on the debt ratio materially. In other words, no matter how we look at them, the acquisitions are too small to make an impact right now. But they could well be steps in the right direction. Weak EPS guidance needs to be seen in perspective A positive top-line forecast for BMS for 2024 is disappointingly, not expected to translate into earnings growth in 2024, though. The company expects non-GAAP earnings per share [EPS] to come in between USD 7.10-7.40 in 2024. At the midpoint of the range, this is a 3.5% decline from 2023’s level of USD 7.51, making it the second consecutive year of decline. However, the figure needs to be looked at in perspective. The number declined from last year because of lower amortisation expenses that get added back to the non-GAAP numbers compared to 2022 and also higher income taxes in 2023. The GAAP EPS actually showed a 31% increase (see chart below for details). And the same may well be true for this year. Consider the dividends The dividends are also worth considering, keeping in mind the stock’s superior dividend yield compared to the sector. Further, the company points out in its latest earnings release that it has paid dividends consistently for the past 92 years. It expects the annual dividend for the current financial year to be USD 2.40, which sustains its TTM yield of 4.5%. Also, even though BMS has been a laggard as far as price is concerned over the long term, its dividends have helped in maintaining positive total returns (see chart below).   Price and Total Returns, 10y (Source: Seeking Alpha)What next? A look at the long-term price returns is not encouraging to any investor. However, for 2024, I do believe that there’s upside to the stock. The company’s revenue growth is expected to turn positive again and it may well report a positive GAAP EPS. At the same time, its P/E is very attractive compared to the sector and so is its dividend yield. I’m going with a Buy on the stock.  Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2417438227"}