Insights

• Bristol-Myers Squibb's profitability is improving, driven by effective cost management and increasing gross profit margins.
• The company's high financial leverage and potential liquidity concerns warrant close monitoring.
• Inconsistent revenue growth and high variability in cash flows pose risks to the company's financial stability.
• The strategic productivity initiative and recent acquisitions could significantly impact future financial performance.
• BMS's profitability ratios are significantly higher than the industry average, indicating superior performance.

Analysis

• Revenue - Revenue is showing an upward trend, but the fit is poor, indicating inconsistent growth. - The company's sales/revenue is significantly greater than the industry average. - The company's 3-year and 5-year CAGR show a deceleration in revenue growth.
  • Profitability
    • Gross profit margin is increasing, driven by decreasing cost of goods sold.
    • Operating expenses are trending downward, reflecting cost-cutting measures.
    • EBIT and net income are trending upward, indicating improved profitability.
    • Profitability ratios (ROA, ROE, ROTC, ROIC) are above average and trending upward, indicating efficient resource utilization.
  • Liquidity
    • The current and quick ratios are below the industry average, indicating potential liquidity concerns.
    • Working capital is increasing, which could improve liquidity.
    • Cash and short-term investments are increasing, further improving liquidity.
  • Solvency
    • The total debt to total equity ratio is high, indicating high financial leverage.
    • The debt/EBITDA ratio is below the industry average, suggesting manageable debt levels.
    • Long-term debt is increasing, reflecting reliance on debt financing.
  • Operational Efficiency
    • Accounts receivable are decreasing, suggesting efficient collection or declining sales.
    • Inventories are increasing, which could indicate anticipation of higher sales or potential overstocking.
    • The company's strategic productivity initiative aims to drive $2 billion in annual cost savings by 2027, which could improve operational efficiency.
  • Cash Flow Analysis - Net operating cash flow is trending downward, raising concerns about the sustainability of core business operations. - Free cash flow to equity is trending downward, further indicating potential financial distress. - Cash dividends paid are steadily increasing, indicating a commitment to shareholder returns.
  • Risk Factors
    • High financial leverage, as indicated by the high total debt to total equity ratio.
    • Inconsistent revenue growth, as reflected in the poor fit of the sales/revenue trend.
    • Potential liquidity concerns, as indicated by the low current and quick ratios.
    • High variability in net income and net operating cash flow, raising concerns about the quality of earnings.
  • Future Outlook
    • Monitor the trend in equity to ensure long-term solvency.
    • Evaluate the effectiveness of the productivity initiative in improving asset utilization and reducing debt.
    • Track the impact of acquisitions on intangible assets and overall financial stability.
    • Focus on improving revenue consistency and managing debt levels.
    • Continue to monitor and manage unusual expenses to understand the true earnings potential.

Benchmarks (as of 2025-06-23)

• Performance Comparison:
  • Bristol Myers Squibb Co. (BMY) has shown mixed performance compared to the Health Care Select Sector SPDR Fund (XLV). Over the past year, BMY outperformed XLV with a return of 16.68% compared to -8.34%. However, over longer periods such as 2 and 3 years, BMY underperformed XLV, with returns of -20.76% and -33.82% respectively, compared to XLV's 4.06% and 7.03%. Year-to-date, BMY has also underperformed XLV, with returns of -15.56% and -3.13% respectively.
• Risk and Return Analysis:
  • The annualized returns show that BMY has a higher return over the past year (16.68%) compared to XLV (-8.34%). However, over 2 and 3 years, BMY's annualized returns are -10.98% and -12.85% respectively, while XLV's are 2.01% and 2.29% respectively, indicating underperformance.
  • BMY's annualized volatility has been generally higher than XLV's, indicating that BMY is more volatile. For example, in Q2 2024, BMY's volatility reached 44.8% while XLV's was 15.72%.
  • BMY's maximum drawdown was -47.67% on 2024-07-03, significantly larger than XLV's maximum drawdown of -17.11% on 2025-05-14. This indicates that BMY has a higher risk profile due to the potential for larger declines from peak values.
• Risk-Adjusted Performance:
  • BMY's Sharpe Ratios are generally lower and frequently negative compared to XLV, indicating lower risk-adjusted returns. For example, as of Q2 2025, BMY's Sharpe ratio is 0.67 while XLV's Sharpe ratio is -0.45.
  • BMY's beta values are consistently below 1, indicating that it is less sensitive to market movements than XLV. As of Q2 2025, BMY's beta is 0.24 while XLV's beta is 0.47.
• Overall Assessment:
  • Bristol Myers Squibb Co. (BMY) has shown mixed performance compared to the Health Care Select Sector SPDR Fund (XLV). While BMY outperformed XLV over the past year, it has underperformed over longer periods and year-to-date. BMY is also more volatile and has a higher risk profile due to its larger maximum drawdown. The Sharpe Ratios indicate that XLV generally offers better risk-adjusted returns. BMY's lower beta suggests it is less sensitive to market movements, which may appeal to risk-averse investors, but it also means it may not benefit as much from market upturns.

Peers Price History(as of 2025-06-23)

• Performance Comparison:

  • Bristol Myers Squibb Co. (BMY) has shown mixed performance compared to Merck & Co., Inc. (MRK) and GSK Plc (GSK). Over the past year, BMY outperformed both MRK and GSK, with returns of 16.68% compared to -37.66% for MRK and -2.96% for GSK. However, over longer periods (2 and 3 years), BMY has generally underperformed GSK. For example, over the last three years, BMY's return was -33.82%, while MRK's was -7.31% and GSK's was -4.28%.
  • The consistency of BMY's performance has varied. While it showed strong outperformance over the last year, its longer-term performance has been less impressive, indicating periods of underperformance relative to its peers.

• Risk and Return Analysis:

  • The annualized returns show that BMY provided a higher return than both MRK and GSK over the past year (16.68% vs. -37.66% and -2.96%, respectively). However, over 2 and 3 years, BMY's annualized returns were negative and lower than MRK's.
  • In terms of annualized volatility, BMY's volatility has fluctuated. In Q2 2024, BMY reached a high volatility of 44.8%, while MRK reached 44.64% and GSK reached 43.03%.
  • The maximum drawdown for BMY was -47.67% on 07/03/2024, which is larger than the maximum drawdown for MRK (-43.44% on 05/14/2025) and GSK (-40.46% on 09/26/2022). This indicates a higher risk profile for BMY.

• Risk-Adjusted Performance:

  • The Sharpe Ratio for BMY was generally lower than that of MRK for most of the period, indicating that MRK offered better risk-adjusted returns. However, there were periods where BMY's Sharpe Ratio surpassed MRK's, suggesting temporary outperformance on a risk-adjusted basis.
  • BMY's beta values were generally below 1, indicating that the stock was less volatile than the overall market. However, BMY's increasing beta in late 2023 and early 2024 suggests a slightly higher sensitivity to market movements.

• Overall Assessment:

  • Bristol Myers Squibb Co. (BMY) has demonstrated mixed performance compared to Merck & Co., Inc. (MRK) and GSK Plc (GSK). While BMY has shown strong outperformance over the past year, its longer-term performance has been less consistent. BMY's higher maximum drawdown and fluctuating Sharpe Ratio indicate a higher risk profile compared to its peers.
  • Recent trends show that BMY experienced high volatility and a significant drawdown in Q2 2024. The increasing beta in late 2023 and early 2024 suggests a higher sensitivity to market movements. These factors should be carefully considered when evaluating BMY as an investment.

Peers Fundamentals(as of 2025-03-31)

1. Market Position and Size:

   • Bristol Myers Squibb (BMY) holds a mid-range market position compared to its peers. Its market capitalization of $95,485.95 million is significantly less than Merck & Co., Inc. (MRK) at $201,284.16 million but greater than GSK Plc (GSK) at $56,800.03 million.
   • BMY's revenue ($47,636 million) and EBITDA ($18,948 million) also fall between those of MRK and GSK, indicating a substantial but not dominant presence in the "Pharmaceuticals: Major" industry.
   • BMY's net income of $5,419 million is less than MRK's $17,434 million but greater than GSK's $3,153 million.

2. Profitability and Efficiency:

   • BMY's profitability metrics, including Gross Profit Margin (59.16%), EBITDA Margin (39.78%), and Net Profit Margin (11.38%), are generally lower than MRK's but higher than GSK's.
   • Compared to the industry average, BMY's profitability metrics are significantly better, as the industry average is a negative number.
   • BMY's efficiency in generating returns, as measured by Return on Average Assets (5.66%), Return on Average Total Equity (31.99%), and Return on Average Total Capital (15.32%), is moderate compared to its peers.

3. Financial Health and Stability:

   • BMY's liquidity, as indicated by its Current Ratio (1.28) and Quick Ratio (1.17), is moderate compared to its peers and below the industry average.
   • BMY's Total Debt to Total Equity Ratio (294.66) is significantly higher than MRK (72.09) and GSK (130.2), indicating a more leveraged financial position.
   • BMY's Debt / EBITDA ratio is 2.62, which is greater than MRK (1.31) and GSK (2.05), but less than the industry average of 6.2.

4. Valuation and Market Perception:

   • BMY's valuation metrics, including Enterprise Value To Sales (3.44), Enterprise Value To EBITDA (8.57), and Price To Earnings (17.62), suggest it is reasonably valued compared to its peers.
   • BMY's Price to Book Ratio (5.49) is greater than MRK (4.17) and GSK (4.05), indicating a higher valuation of its assets.
   • BMY's Price To Sales Ratio (2.01) is less than MRK (3.18) but greater than GSK (1.84).

5. Cash Flow and Capital Management:

   • BMY's Net Operating Cash Flow ($14,310 million) and Free Cash Flow ($13,086 million) are substantial, indicating strong cash generation capabilities.
   • BMY's Total Capital Expenditure ($1,224 million) is less than MRK ($3,839 million) and GSK ($2,867 million), suggesting a more conservative approach to capital investments.
   • BMY's Cash Flow / Total Debt is 30.39, which is less than MRK (71.39) and GSK (35.28).

6. Growth and Future Prospect:

   • BMY's 5-Year CAGR in Sales/Revenue (8.97%) is greater than its peers and the peer average, indicating strong long-term revenue growth.
   • BMY's net income and basic earnings per share growth have been highly volatile and generally underperforming compared to peers.
   • BMY's most recent year-over-year growth rates for Sales/Revenue, EBITDA, and Free Cash Flow are lower than their respective 5-year CAGRs, indicating a deceleration in growth.

7. Potential for Investment:

   • BMY presents a mixed investment profile. Its strong revenue growth and reasonable valuation metrics are attractive.
   • However, its high debt levels, lower profitability compared to MRK, and inconsistent earnings growth raise concerns.
   • Investors should carefully weigh these factors and consider BMY's growth potential and financial stability relative to its peers before making an investment decision.

8. Key Risks and Considerations:

   • BMY's high debt levels pose a significant risk, as they increase financial leverage and vulnerability to economic downturns.
   • The volatility in BMY's net income and basic earnings per share growth raises concerns about the sustainability of its overall growth profile.
   • BMY's lower profitability compared to MRK suggests potential inefficiencies or higher costs that need to be addressed.

9. Overall Assessment:

   • BMY's overall financial health is moderate compared to its peers. It exhibits strong revenue growth and cash flow generation, but its high debt levels and lower efficiency in asset utilization raise concerns.
   • While BMY outperforms GSK in several metrics, it generally underperforms MRK, indicating room for improvement in operational efficiency and financial management.
   • BMY occupies a mid-tier position within its peer group, suggesting it is a significant player in the "Pharmaceuticals: Major" industry but not a dominant leader.