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Bristol-Myers Shares Jump As Goldman Sachs Moves It To 'Conviction Buy' List

Goldman analyst Terence Flynn said FDA approvals and pipeline developments could lift Bristol-Myers sales to around $13 billion over the next four years.

Bristol-Myers Squibb Co.  (BMY) - Get Bristol-Myers Squibb Company Report shares jumped higher Tuesday after analysts at Goldman Sachs added the pharmaceutical group to its conviction buy list.

Goldman analyst Terence Flynn lifted his price target on the group by $4 per share, to $86 per share, and boosted his rating to 'conviction buy', citing the potential for new treatment approvals from the Food & Drug Administration and an existing pipeline of new products that could drive upward revisions on estimates for earnings and multiples. He also sees 2025 revenues in the region of $13 billion.

Bristol-Myers posted positive late-stage data from a key lung cancer treatment study in October that showed patients responding to treatments of chemotherapy and Opdivo, the group's blockbuster drug, when compared to patients who only received chemotherapy. That was followed by another promising study psoriasis treatment, known as deucravacitinib, which could ultimately challenge Novartis AG's Cosentyx. 

Bristol-Myers shares were marked 2% higher in early Tuesday trading to change hands at $61.15 each, a move that would edge their six month gain to around 11%.

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 Last month, boosted its 2020 profit outlook after a solid third quarter that included a 75% surge in group revenues following last year's $74 billion takeover of Celgene.

Worldwide sales of its blood clot treatment, Eliquis, rose 9% to $2.1 billion, offsetting a slide in revenues for Opdivo, the group's blockbuster cancer treatment, which fell 2% to $1.78 billion.

Looking into the final months of the year, Bristol-Myers said it sees non-GAAP earnings of $6.25 to $6.35 per share, up from a prior forecast of $6.10 to $6.25 per share, and revenues in the range of $41.5 billion to $42 billion, a modest increase from the lower end of its previous forecast.