Bristol-Myers Beats Q1 Estimates, Reaffirms FY20 Profit View

Bristol-Myers Beats Q1 Estimates, Reaffirms FY20 Profit View
May 8, 2020

 

Biopharmaceutical company Bristol-Myers Squibb Co (NYSE: BMY) swung to a GAAP loss in the first quarter of fiscal 2020. However, the company’s adjusted earnings and revenues surpassed Wall Street estimates. Bristol-Myers also reconfirmed its yearly adjusted profit outlook. The stock closed at $61.04, down $0.09 or 0.15% from the prior close.

The New York-based company posted first-quarter revenues of $10.78 billion, an increase of 82% from $5.92 billion in the comparable quarter last year. Excluding the impact of the Covid-19 pandemic, the company posted a 8% increase in revenues. Analysts anticipated Bristol-Myers to report revenues of $10.02 billion for the reported period.

The rise in revenues was led mainly by the effect of the Celgene takeover, which generated 71% growth. The recent quarter also benefited by roughly $500 million from purchasing patterns associated with the Covid-19 outbreak.

For the quarter ended March 31st, 2020, Bristol Myers recorded a net loss of $775 million, or $0.34 per share, compared with net earnings of $1.71 billion, or $1.04 per share, in the prior year’s comparable quarter.

Excluding costs related to the purchase price accounting, acquisition and integration expenses, and contingent value rights fair value adjustments, Bristol Myers recorded Q1 non-GAAP earnings of $3.96 billion, or $1.71 per share, compared with non-GAAP earnings of $1.80 billion, or $1.10 a share last year. Analysts surveyed by Thomson Reuters anticipated the company to post earnings of $1.49 per share for the first quarter.

While the US revenues rose 96% to $6.80 billion in the quarter, international revenues increased 62% to $4.0 billion in the year-ago period. When adjusted for Forex impact, international revenues increased by 65%.

The company stated that it gained roughly $500 million from consumers’ decisions to stock medicines due to coronavirus outbreak. The blood thinner Eliquis, which is sold in partnership with Pfizer, recorded a 37% y-o-y growth in revenue to $2.60 billion. Analysts had anticipated Eliquis to record sales of about $2.20 billion in the quarter.

Multiple myeloma drug Revlimid, which Bristol added to its portfolio through the takeover of Celgene for $74 billion, generated revenue of $2.9 billion for the first quarter, surpassing analyst estimates of $2.8 billion.

Going forward, the company slashed its FY 2020 GAAP earnings outlook to a range of between $0.37 and $0.57 per share, from the earlier range of $0.75 to $0.95 per share.

Bristol Myers now forecasts FY 2020 revenues to be $40 billion to $42 billion, downwardly revised from the earlier outlook of between $40.5 billion and 42.50 billion. Analysts anticipate revenues of $41.65 billion for FY 2020.

Nevertheless, the company reaffirmed its FY 2020 non-GAAP earnings outlook range of $6 to $6.20. The median Consensus estimate currently stands at $6.17 per share. The company also confirmed its FY 2021 non-GAAP earnings of $7.15 to $7.45 per share. Analysts anticipate yearly earnings of $7.38 per share.

Regarding the FY 2020 projections, CEO Giovanni Caforio said, “We are well-positioned to continue to successfully drive commercial execution of our inline business, launch new brands, progress our integration efforts, and deliver our synergy targets while advancing our pipeline. Our financial strength enables us to maintain a capital allocation plan focused on commitment to our dividend, and prioritize debt-reduction and business development.”

The quarterly earnings beat, the downward revision of the FY 2020 revenue outlook, and reaffirmation of FY 2020 non-GAAP earnings is expected to keep the stock range-bound with a slight bullish bias.

The price chart indicates that the stock is trading above its 50-day moving average after bouncing off the support at 48. The next minor resistance is anticipated only near 68-70 levels. Additionally, the Chaikin money flow indicator also has a positive reading. Therefore, we are anticipating the stock to remain bullish in the short-term.

bristol - technical analysis - 8th May 2020

Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.

Richard W

Richard W

Richard is the guy who know everything there is about the financial industry, working in a top firm for over 15 years, he will give the lowdown on some of the biggest companies in the world


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