Guggenheim raised price to $75. Friday. Very interesting as they have been known to broker sales for PFE. Most likely means nothing but an upgrade,,
Bristol-Myers Squibb (BMY: NYSE) Guggenheim Securities ($65.11, Oct. 12, 2017)
We are raising our price target for Bristol-Myers Squibb to $75 from $68.
[We rate Bristol-Myers (ticker: BMY) at Buy.]
Our rationale for the increase stems from our conviction in the readout of the Checkmate-227 trial evaluating non-small cell lung cancer (NSCLC). Despite the failure of AstraZeneca's (AZN) MYSTIC trial, we believe Bristol-Myers's PD-1 and CTLA-4 inhibitors combo have a high probability of achieving success in first-line (1L) NSCLC. In the near-term, the high expressors cohort of CM-227 is likely to read out in the fourth quarter or first-quarter 2018, which we believe will be positive. With Keytruda + Chemo holding 1L treatment for NSCLC, there is still an opportunity for a less toxic therapy that doesn't involve chemo to take Merck's (MRK) lucrative spot.
On our conviction that Bristol-Myers's CM-227 will read out positively (in expressors cohort and possibly all-comers), we have raised our Opdivo revenue estimates in 2018 and onward, reaching $9 billion-plus by 2020. Accordingly, we have also raised our estimates for Yervoy in 2018 and onward (reaching about $2.1 billion by 2020).
There is also the optionality in which the Opdivo + Chemo combo arm will succeed in all-comers, which primes Bristol-Myers to take 1L market share from Merck with its own PD-1/Chemo combo. Our new 12-month price target of $75 is based on a DCF analysis using a weighted average cost of capital (WACC) of 7.5% and 2% LT growth rate (both unchanged). With an important CheckMate-227 trial readout on the horizon that offers multiple optionality to take share in 1L NSCLC setting, we remain Buy-rated and raise our price target.
Our third-quarter earnings-per-share estimate moves to 78 cents from 79 cents. Our revenue estimate has decreased to $5.22 billion from $5.27 billion based on U.S. script trends. Consensus estimates are currently at 76 cents for the quarter on revenue of $5.16 billion. Daklinza scripts continue to be significantly impacted by the launch of Epclusa, sequentially declining 32% this quarter compared to a 7.5% decline last quarter. Our fiscal 2017 EPS estimate remains at $3.00 while our revenue estimate decreases to $20.63 billion from $20.74 billion. The modest shifts in earnings result from revenue changes based on scripts trends and adjustments to expenses.
Bristol-Myers narrowed and raised the lower end of its non-GAAP 2017 EPS range from $2.85-$3.00 to $2.90-$3.00. Guidance assumes current exchange rates, 21% non-GAAP (23% GAAP) tax rate, and excludes impact of any potential future acquisitions and divestitures as well as any specified items that haven't been identified.
CheckMate-227, a Phase 3 trial investigating Opdivo, Opdivo plus Yervoy, and Opdivo plus chemotherapy in 1L NSCLC in both PD-L1 expressors and non-expressors, has been a large focus of investors since the failure of nivolumab monotherapy in CheckMate-026 last year and the recent failure of AstraZeneca's MYSTIC trial. '227 is scheduled to read out in 1H18 with a possible interim analysis before then. It is likely that not all of the data is mature in 1H18. It has been our view that combination therapy will be the mainstay of NSCLC therapy. However, the first line lung cancer market in patients expressing PD-L1 at 50% or higher has currently been captured by Merck based on the Keynote-024 trial. We expect this share to expand after the approval in May of the Keytruda plus chemo combination in 1L setting (pending outcome for Keynote-189). Furthermore, Opdivo sales may see pressure if AstraZeneca's MYSTIC trial is positive. We have previously explained why we believe the MYSTIC failure has no read-through to '227.
Recent BMY News
- CHMP Adopts Positive Opinion Recommending Approval of Bristol Myers Squibb’s Opdivo® (nivolumab) in Combination with Cisplatin and Gemcitabine for the First-Line Treatment of Adult Patients with Unresectable or Metastatic Urothelial Carcinoma • Business Wire • 04/26/2024 10:59:00 AM
- U.S. Futures Drop in Pre-Market Trading as Tech Stocks Plunge After Meta Issues Gloomy Forecast • IH Market News • 04/25/2024 11:53:54 AM
- Bristol Myers Squibb Reports First Quarter Financial Results for 2024 • Business Wire • 04/25/2024 10:59:00 AM
- Apple Loses Market Share in China, GM Surges in Pre-Market Following Upward Revisions for 2024 Projections, and More News • IH Market News • 04/23/2024 11:25:34 AM
- Bristol Myers Squibb and Cellares Announce a $380M Worldwide Capacity Reservation and Supply Agreement for the Manufacture of CAR T Cell Therapies to Bring the Promise of Cell Therapy to More Patients, Faster • Business Wire • 04/22/2024 10:59:00 AM
- Bristol Myers Squibb and Cellares Announce a $380M Worldwide Capacity Reservation and Supply Agreement for the Manufacture of CAR T Cell Therapies to Bring the Promise of Cell Therapy to More Patients, Faster • Business Wire • 04/22/2024 10:59:00 AM
- KRAZATI (adagrasib) in Combination with Cetuximab Demonstrates Clinically Meaningful Activity as a Targeted Treatment Option for Patients with Previously Treated KRAS G12C-Mutated Locally Advanced or Metastatic Colorectal Cancer (CRC) • Business Wire • 04/08/2024 03:30:00 PM
- Bristol Myers Squibb Presents New Pooled Interim Long-Term Safety and Metabolic Outcomes Data from the EMERGENT Program Evaluating KarXT in Schizophrenia at the 2024 Annual Congress of the Schizophrenia International Research Society • Business Wire • 04/06/2024 05:15:00 PM
- Bristol Myers Squibb Presents New Interim Long-Term Efficacy Data from the EMERGENT-4 Trial Evaluating KarXT in Schizophrenia at the 2024 Annual Congress of the Schizophrenia International Research Society • Business Wire • 04/06/2024 05:15:00 PM
- U.S. FDA Approves Bristol Myers Squibb and 2seventy bio’s Abecma for Triple-Class Exposed Relapsed or Refractory Multiple Myeloma After Two Prior Lines of Therapy • Business Wire • 04/05/2024 01:05:00 PM
- European Commission Expands Approval of Bristol Myers Squibb’s Reblozyl® (luspatercept) to Include First-Line Treatment of Transfusion-Dependent Anemia in Adults with Lower-Risk Myelodysplastic Syndromes (LR-MDS) • Business Wire • 04/03/2024 12:08:00 AM
- Bristol Myers Squibb Releases 2023 Environmental, Social and Governance Report Demonstrating Progress and Setting New Long-Term Goals • Business Wire • 04/02/2024 10:59:00 AM
- Bristol Myers Squibb Announces Pivotal KRYSTAL-12 Confirmatory Trial Evaluating KRAZATI (adagrasib) Meets Primary Endpoint of Progression-Free Survival for Patients with Pretreated KRASG12C-Mutated Locally Advanced or Metastatic Non-Small Cell Lung… • Business Wire • 03/28/2024 08:05:00 PM
- Bristol Myers Squibb Provides Update on the First Phase 3 YELLOWSTONE Trial Evaluating Oral Zeposia (ozanimod) in Patients with Moderate to Severe Active Crohn’s Disease • Business Wire • 03/28/2024 08:01:00 PM
- Perspective Therapeutics Provides Recent Business Highlights and Reports Fiscal Year 2023 Financial Results • GlobeNewswire Inc. • 03/28/2024 11:30:08 AM
- A Bristol Myers Squibb Expande as Iniciativas de Doações para a Equidade em Saúde a fim de Melhorar os Resultados de Saúde • Business Wire • 03/26/2024 06:25:00 PM
- Bristol Myers Squibb Expands Health Equity Grant Initiatives to Improve Health Outcomes • Business Wire • 03/26/2024 10:59:00 AM
- Bristol Myers Squibb to Present Data at the American College of Cardiology Annual Scientific Session 2024 Reinforcing Extensive Body of Evidence in Clinical and Real-World Settings Across Cardiovascular Portfolio • Business Wire • 03/25/2024 12:00:00 PM
- Bristol Myers Squibb’s Abecma (idecabtagene vicleucel) Becomes First CAR T Cell Therapy Approved in the European Union in Earlier Lines for Triple-Class Exposed Relapsed and Refractory Multiple Myeloma • Business Wire • 03/20/2024 08:45:00 PM
- Bristol Myers Squibb Announces CheckMate -9DW Trial Evaluating Opdivo (nivolumab) Plus Yervoy (ipilimumab) Meets Primary Endpoint of Overall Survival for the First-Line Treatment of Advanced Hepatocellular Carcinoma • Business Wire • 03/20/2024 10:59:00 AM
- Bristol Myers Squibb and Ted Danson Empower Those with Plaque Psoriasis to Take Action in “SO, Have You Found It?” Campaign • Business Wire • 03/19/2024 10:59:00 AM
- Bristol Myers Squibb Completes Acquisition of Karuna Therapeutics, Strengthening Neuroscience Portfolio • Business Wire • 03/18/2024 12:44:00 PM
- FDA Advisory Committee Votes in Favor of Bristol Myers Squibb’s and 2seventy bio’s Abecma for Triple-Class Exposed Multiple Myeloma in Earlier Lines of Therapy • Business Wire • 03/15/2024 10:27:00 PM
- U.S. FDA Approves Bristol Myers Squibb’s Breyanzi® as the First and Only CAR T Cell Therapy for Adults with Relapsed or Refractory Chronic Lymphocytic Leukemia (CLL) or Small Lymphocytic Lymphoma (SLL) • Business Wire • 03/15/2024 01:35:00 AM
- Bristol Myers Squibb to Report Results for First Quarter 2024 on April 25, 2024 • Business Wire • 03/11/2024 08:16:00 PM
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