Shares of Bristol-Myers Squibb Co.  (BMY) shot out of a cannon Thursday, racing higher by 5.55% to $68.98.

Earlier this month the company beat on earnings per share and revenue expectations, but it was a new price target that spurred shares higher Thursday. Morgan Stanley analyst David Risinger slapped a $78 price target on the stock, the highest on Wall Street.

However, Risinger isn't the only bull. Citigroup's Andrew Baum matched Risinger's price target just a day later, putting a $78 target on Bristol-Myers stock Friday. He laid out a scenario where Pfizer (PFE) may look to buy the company despite its $112 billion market cap.

He views the odds of a takeover at 65%, up from 50%. Baum says there are three catalysts for a potential takeover:

  1. "Revenue potential in non-small cell lung cancer is partly de-risked" thanks to its "Checkmate-227 tumor mutation burden data."
  2. Its recent collaboration and equity stake in Nektar Therapeutics (NKTR) could boost market share for Opdivo.
  3. Given that Pfizer's immuno-oncology efforts are looking "increasing suspect," acquiring Bristol-Myers could be its last chance at eating a meaningful piece of the annual $50 billion immuno-oncology pie.

From current levels, Risinger and Baum's price target implies more than 12% upside. For Risinger's part, he was optimistic on the company's prospects of treating first-line lung cancer with a combination of its Opdivo and Yervoy treatments.

Despite extending the highs it set on Thursday, Bristol-Myers stock ultimately finished flat on the day, falling 0.087% on the day to $68.97. Pfizer on the other hand closed higher by 1.54%, closing at $36.26. 

Notably, Bristol-Myers stock also pays a 2.3% dividend yield.

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.

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