How Will Bristol Myers Squibb Stock Trend Post Q3 Results?

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Trefis
BMY: Bristol Myers Squibb logo
BMY
Bristol Myers Squibb

Bristol Myers Squibb (NYSE: BMY) is scheduled to report its Q3 2022 results on Wednesday, October 26. We expect BMS to report revenue and earnings slightly above the consensus estimates, led by continued market share gains for Eliquis, Opdivo, and Reblozyl, partly offset by forex headwinds and an expected decline in Revlimid sales, which now face biosimilar competition. Although we expect the company to navigate well over the latest quarter, we find its stock fairly valued at its current levels, as discussed below. Our interactive dashboard analysis of Bristol Myers Squibb Earnings Preview has additional details.

(1) Revenues expected to be slightly above the consensus estimates

  • Trefis estimates BMS’ Q3 2022 revenues to be around $11.3 billion, reflecting a low single-digit y-o-y decline but slightly above the consensus estimate of $11.1 billion.
  • Forex headwinds are likely to weigh on the company’s overall performance.
  • A decline in Revlimid sales will likely more than offset sales growth for Eliquis, Opdivo, and Reblozyl.
  • Looking at Q2 2022, the company saw its sales grow 2% y-o-y to $11.9 billion. The growth primarily reflects the continued market share gains for Eliquis, which saw sales growth of 16% (y-o-y) to $3.2 billion.
  • Our dashboard on Bristol Myers Squibb’s Revenues  details the company’s segments.
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(2) EPS likely to be above the consensus estimates

  • BMS’ Q2 2022 adjusted earnings per share is expected to be $1.85 per Trefis analysis, slightly above the consensus estimate of $1.82. This compares with the $2.00 figure reported in the prior-year quarter.
  • The company’s adjusted net income of $4.2 billion in Q1 2022 reflected a 14% rise from its $3.7 billion figure in the prior-year quarter, partly due to lower operating expenses.
  • For the full-year 2022, we expect the adjusted EPS to be flat at $7.50, compared to the EPS of $7.51 in 2021.

(3) BMY stock looks reasonably valued

  • We estimate Bristol Myers Squibb’s Valuation to be around $78 per share, just 9% above the current market price of $72.
  • At its current levels, BMY stock is trading at a  P/E multiple of under 10x based on our EPS estimate of $7.50 for 2022, compared to the last three-year average of 9x, implying that BMY stock is fairly valued currently.
  • However, if the company reports upbeat Q3 results and provides an outlook better than the street estimates, the P/E multiple will likely be revised upward, resulting in higher levels for BMY stock.

While BMY stock looks fairly valued, it is helpful to see how Bristol Myers Squibb’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons.

Furthermore, the Covid-19 crisis has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how counter-intuitive the stock valuation is for Mednax vs. Penske Automotive

Despite inflation rising and the Fed raising interest rates, BMY stock has risen 15% this year. But can it drop from here? See how low Bristol Myers Squibb stock can go by comparing its decline in previous market crashes. Here is a performance summary of all stocks in previous market crashes.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

Returns Oct 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 BMY Return 1% 15% 23%
 S&P 500 Return 4% -22% 66%
 Trefis Multi-Strategy Portfolio 3% -24% 201%

[1] Month-to-date and year-to-date as of 10/19/2022
[2] Cumulative total returns since the end of 2016

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