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Bristol-Myers Squibb Company Message Board

  • investora2z investora2z Sep 12, 2013 7:26 AM Flag

    Around crucial supports

    The stock has declined over the last few months, but seems to be making a recovery over the past couple of weeks. Jefferies have reduced the PT from $45 to $41 recently. The consensus target for the stock is around $45, with an average rating of hold. A recent article on SA has recommended to buy the stock. The author considers the recent decline as an opportunity to buy the stock for the long term. He mentions that despite the expected loss of patents over the next few years, the company is likely to maintain or improve upon its position in cardiology, Cancer and Hepatitis C. International revenues have increased in proportion over the years, and in 2012 they comprised 42% of the sales. Expected continuation of the buyback program is also expected to reduce the share count by 10% over next 3 years. The author is banking upon the expected growth in revenues due to new products in the cancer field. Bristol is likely to become a dominant player in cancer due to its multiple revolutionary product line in immunotherapy. This industry has huge potential in view of its expected size of $35 billion by 2023. The author gives a PT of $59.50 for the stock by 2016, implying 50% returns if one considers the dividend payments. He expects the price to touch $80 by end of the decade. Despite what is mentioned in the article, growth may not be easy if one considers the expected loss of patents and increasing competition. Importantly, the bottom-line needs to grow, which requires efforts on cost control. Biozone (BZNE) has recently been in news for its proprietary drug delivery technology (QuSomes) which can help reduce cost of production. Dr. Frost (TEVA, OPKO fame), has a stake in this company. Bristol already has a collaboration with OPKO in diagnostics. Bristol remains a good stock for the long term, but the company needs to show improvements in the fundamentals so that the uptrend resumes.

 
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