It's been a good week for Bristol-Myers Squibb Company (NYSE:BMY) shareholders, because the company has just released its latest quarterly results, and the shares gained 9.2% to US$63.80. It looks like a credible result overall - although revenues of US$11b were what the analysts expected, Bristol-Myers Squibb surprised by delivering a (statutory) profit of US$0.82 per share, an impressive 213% above what was forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Following the latest results, Bristol-Myers Squibb's 16 analysts are now forecasting revenues of US$45.8b in 2021. This would be a notable 16% improvement in sales compared to the last 12 months. Bristol-Myers Squibb is also expected to turn profitable, with statutory earnings of US$4.09 per share. In the lead-up to this report, the analysts had been modelling revenues of US$45.7b and earnings per share (EPS) of US$4.09 in 2021. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of US$73.69, suggesting that the company has met expectations in its recent result. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Bristol-Myers Squibb analyst has a price target of US$88.00 per share, while the most pessimistic values it at US$64.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Bristol-Myers Squibb shareholders.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. Next year brings more of the same, according to the analysts, with revenue forecast to grow 16%, in line with its 15% annual growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 6.7% next year. So it's pretty clear that Bristol-Myers Squibb is forecast to grow substantially faster than its industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. The consensus price target held steady at US$73.69, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Bristol-Myers Squibb. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Bristol-Myers Squibb going out to 2024, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 4 warning signs for Bristol-Myers Squibb (of which 1 is potentially serious!) you should know about.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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