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Opinions Stuart Hinshelwood
Bristol Myers SquibbBMYBUYNov 01, 2013
Stuart HinshelwoodStock price when the opinion was issued
As of Jun 18, 2026. Market Open.
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Big on immune oncology and cardio. Technically doesn't look great, but eventually "the train will come along and collect the mail bag". Makes a ton of $$ in NA. Wide moat. Concerns about pipeline, but he thinks it's pretty good. Limited downside. Yield is 4.9%.
Good pricing power. Because products are so specialized, FDA puts them on sort of a fast track.
In the past quarter, They recently bought 3 companies, including Mirati, a small oncology company, and Karuna who may develop a wonder drug to treat schizophrenia. BMY needs to buy companies, because their top 3 drugs face steep patent cliffs, like a blood-clot drug, accounting for over 61% of 2023 (Jan-Sept)'s sales.
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Premium contentThe company has partnered with a Chinese pharma company for a new drug to lung and breast cancer patients. They will have exclusive rights outside of China. It trades at 13x earnings and supports a ROE of 26%. It has a good dividend, backed by a payout ratio under 60% of cash flow. The company has been prudentially using some cash reserves to aggressively buy back shares and retire debt. We recommend placing a stop at $44, looking to achieve $63 -- upside potential of 23%. Yield 4.4%
(Analysts’ price target is $62.82)
It has some real challenges from 2026 to 2030 when some of their drugs will come off patents. They will need to fill their pipeline. This is reflected in the 8X earnings multiple. As for Amgen, it has defensive characteristics but we need to make sure they execute their plans.
Jim LebenthalJim Lebenthal
Seems like it is running out of a little bit of steam. The primary concern is that the stock is the most expensive in the large-cap pharmaceutical space. There has been some run off in their Liquis (?), blood thinner drug. Likes the business. You are paying up for it because the pipeline has more risk in it. This is a name that you can own. Feels they have decent pipeline and opportunities over the next several years.