Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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Highlights from the ratings report include:
- Net operating cash flow has increased to $1,510.00 million or 33.15% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.36%.
- The gross profit margin for BRISTOL-MYERS SQUIBB CO is currently very high, coming in at 80.68%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, BMY's net profit margin of 13.24% significantly trails the industry average.
- Compared to its closing price of one year ago, BMY's share price has jumped by 31.68%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- The current debt-to-equity ratio, 0.50, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that BMY's debt-to-equity ratio is low, the quick ratio, which is currently 0.56, displays a potential problem in covering short-term cash needs.
- BRISTOL-MYERS SQUIBB CO's earnings per share declined by 15.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, BRISTOL-MYERS SQUIBB CO reported lower earnings of $1.15 versus $2.15 in the prior year. This year, the market expects an improvement in earnings ($1.73 versus $1.15).
Bristol-Myers Squibb Company, a biopharmaceutical company, discovers, develops, licenses, manufactures, markets, distributes, and sells biopharmaceutical products that help patients prevail over serious diseases worldwide. Bristol-Myers Squibb has a market cap of $68.0 billion and is part of the health care sector and drugs industry. Shares are up 26.8% year to date as of the close of trading on Thursday.
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--Written by a member of TheStreet Ratings Staff.