NEW YORK (TheStreet) -- BMO Capital Markets raised its price target for Bristol-Myers Squibb (BMY) - Get Report to $75 from $70 on Tuesday, reiterating its "outperform" rating.

The analyst firm raised its 2015 EPS estimates for the drug manufacturer to $1.86 from $1.81 a share. BMO also raised its 2016 EPS estimates for Bristol-Myers to $2.70 from $2.51 a share.

BMO Capital Markets analyst Alex Arfaei said Bristol-Myers is well positioned on its upcoming immune-oncology (IO) opportunity.

Arfaei said that new CEO and COO Dr. Giovanni Caforio's priorities will be "to 1) maintain Bristol's leadership in IO, and 2) diversify the business in specialty markets. He plans to make the necessary internal and external investments to achieve these goals."

The analyst continued, "Bristol has already invested in much of the commercial infrastructure needed to launch Opdivo in multiple indications, thus there will be leverage in the P&L. Management does not expect re-imbursement hurdles for Opdivo in NSCLC. They also remain confident about their broad (i.e., unselected) development strategy. We continue to argue that PD-L1 expression is dynamic, and highly doubt that PD-L1 negative patients will be denied treatment."


Separately, TheStreet Ratings team rates BRISTOL-MYERS SQUIBB CO as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate BRISTOL-MYERS SQUIBB CO (BMY) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The current debt-to-equity ratio, 0.53, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.26, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for BRISTOL-MYERS SQUIBB CO is currently very high, coming in at 82.62%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 0.30% trails the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 8.2%. Since the same quarter one year prior, revenues slightly dropped by 4.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Pharmaceuticals industry. The net income has significantly decreased by 98.2% when compared to the same quarter one year ago, falling from $726.00 million to $13.00 million.
  • Net operating cash flow has significantly decreased to $572.00 million or 59.43% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • You can view the full analysis from the report here: BMY Ratings Report