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Bristol Myers Squibb (BMY) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
·3 mins read

Bristol Myers Squibb (BMY) closed the most recent trading day at $58.76, moving +1.71% from the previous trading session. This move outpaced the S&P 500's daily gain of 1.05%. Elsewhere, the Dow gained 0.52%, while the tech-heavy Nasdaq added 1.72%.

Coming into today, shares of the biopharmaceutical company had lost 7.43% in the past month. In that same time, the Medical sector lost 1.66%, while the S&P 500 lost 3.29%.

Wall Street will be looking for positivity from BMY as it approaches its next earnings report date. This is expected to be November 5, 2020. In that report, analysts expect BMY to post earnings of $1.48 per share. This would mark year-over-year growth of 26.5%. Meanwhile, our latest consensus estimate is calling for revenue of $10.37 billion, up 72.68% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.24 per share and revenue of $41.89 billion. These totals would mark changes of +33.05% and +60.23%, respectively, from last year.

Any recent changes to analyst estimates for BMY should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.11% higher within the past month. BMY is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, BMY is currently trading at a Forward P/E ratio of 9.25. Its industry sports an average Forward P/E of 24.42, so we one might conclude that BMY is trading at a discount comparatively.

Meanwhile, BMY's PEG ratio is currently 1.07. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Medical - Biomedical and Genetics was holding an average PEG ratio of 1.51 at yesterday's closing price.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 190, putting it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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