Bristol Myers’ stock decline in response to weak guidance is a gift to investors

Bristol Myers Squibb on Thursday reported better-than-expected quarterly results, but weak guidance for 2025 sent shares lower. Jim Cramer’s faith in the drugmaker is unshaken. Revenue in the fourth quarter rose 8% year over year to $12.34 billion, well ahead of the $11.57 billion consensus, according to analysts’ estimates compiled by LSEG. Adjusted earnings per share (EPS) of $1.67 in the three months ended Dec. 31 topped estimates of $1.46, LSEG data showed. On an annual basis, adjusted EPS declined 1.8%. Bristol Myers Squibb (BMY) Why we own it: The company’s new schizophrenia treatment Cobenfy has immense sales potential, though it remains in the early innings. Bristol Myers has key products, such as blood-clot prevention drug Eliquis and lung-cancer therapy Opdivo, which will be coming off patent in the coming years. However, we believe its portfolio of growth drugs including Cobenfy can help navigate that patent cliff. Initiation: Nov. 25, 2024 Most recent buy date: Jan. 17, 2025 Competitors: AbbVie , Pfizer , Amgen , Johnson & Johnson and Merck Bottom line The slide in Bristol Myers’ stock Thursday — down more than 4.5% at session lows below $57 — is a gift for long-term investors. We’re reiterating our buy-equivalent 1 rating and price target of $70 a share. Bristol Myers shares were later able to recover some, down roughly 2% in late morning trading.