QS Research · Michael Burry's Scion Capital analyst template · 2006
BRISTOL MYERS SQUIBB CO (BMY)
As of 2026-11-11 · 12/15 boxes filled from SEC filings and market data
Report price $62.80 (close 2026-11-10)
Conclusion: WATCH
Conviction low · base case +0% · downside -19% · upside +88%
BMY is cheap on every multiple in the peer table (EV/Sales 3.19x, EV/EBITDA 10.1x on GAAP EBITDA, P/E 13.9x, operating P/E 12.1x) with a 7.2% FCF yield and ROIC of 18.7% against a 5.1% WACC, so the market is pricing permanent erosion of the Legacy/Eliquis franchise rather than a temporary patent-cliff transition. The code's base case is +0.1% to $62.83, using the 41.5x peer-median P/E anchor; the downside is -18.9% to $50.93 at 10.3x P/E (15% below today's 12.1x) with $0.23 a share of exposure stress, and the upside is +88.5% to $118.38. Reward/risk is 4.68, but the upside depends on a multiple re-rate that the 41/100 quality score and the 2026 EPS guidance cut to $6.35-6.55 do not support yet. I would watch, not buy: the dated catalysts (Reblozyl PDUFA 2027-03-11, mezigdomide PDUFA 2027-05-13, $2B efficiencies by 2027) are real but not yet in the numbers, and the base case is essentially flat rather than an operating improvement.
Key numbers
- Share price: $62.80
- Market cap: $128.37B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $50.03B
- EV / EBITDA (TTM): 10.1x
- P/E (TTM): 13.9x
- FCF yield: 7.2%
- Price / book: 5.48x
- Earnings-quality flags (TTM): none flagged
- P/E, operating (tax-normalized) (TTM): 12.1x
- EV / FCF (TTM): 17.2x
- Revenue growth (latest fiscal year): -0.2%
- ROIC (TTM): 18.7%
- WACC: 5.1%
- Economic profit spread: +13.7 pts
The 15 boxes
- ✓ 1. Long-form business notes
BMY is a one-segment biopharma (FY2020 10-K) that sells branded medicines mainly through wholesalers, distributors and specialty pharmacies. Revenue rose from $42.52B in FY2020 to $48.19B in FY2025 and $50.03B TTM to 2026-09-30, while pretax income swung from -$6.87B in FY2020 to $9.33B in FY2025 and $11.33B TTM. The latest report stresses key-product concentration, loss of exclusivity (U.S. generic lenalidomide no longer volume-limited as of Jan 31 2026; Eliquis generics in certain EU countries) and royalty income of about $2.7B in 2025 that faces scheduled terminations.
- ✓ 2. Competitive advantage
On the sources given, BMY shows no clear durable advantage: the 10-K says loss of exclusivity can cost 'the major portion of that product's revenue in a very short period of time', and the FY2025 risk factors describe government-set prices on Eliquis (from 2026), Pomalyst (from 2027) and Orencia (negotiation from 2028). The record is not a stable-margin one: revenue went $42.52B (FY2020) to $48.19B (FY2025) and $50.03B TTM to 2026-09-30, while pre-tax income was -$6.87B (FY2020), -$8.38B (FY2024), then $9.33B (FY2025) and $11.33B TTM. Cash is the steadiest number: operating cash flow $14.16B against capex $1.31B in FY2025, and $10.65B against $1.37B TTM, with intangible amortization shrinking from $9.90B (FY2020) to $2.30B TTM.
- ✓ 3. 10-Q takeaways
Q3 2026 revenue rose 7% to $13,069 million (nine months +5% to $37,532 million), led by Growth Portfolio +12% to $7,662 million and Eliquis +25% to $4,690 million, but GAAP gross margin fell 360 bps to 68.3% and GAAP EPS slipped to $1.05 from $1.08 (non-GAAP $1.35 vs $1.63). Management raised FY2026 revenue guidance to $49.75-50.25 billion and set non-GAAP EPS at $6.35-6.55, inclusive of a $(0.60) per-share Acquired IPRD and licensing impact. Nine-month operating cash flow fell to $8,678 million from $12,182 million, with the rebates-and-discounts working-capital line swinging to a $(3,869) million use from a $1,957 million source a year earlier.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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