Bristol-Myers Squibb’s Price Target From Berenberg Lifted to $58 From $57

Bristol-Myers Squibb (BMY) received a slight boost to its price target from Berenberg following the pharmaceutical company’s report last week of increased 2018 guidance and better-than-expected Q3 adjusted earnings per share despite weaker-than-expected revenue for the quarter.

Berenberg’s new price target on the stock is $58 per share, up from $57. The shares closed Tuesday’s session at $50.02. Berenberg kept its investment rating on the shares at hold.

In a note to clients, the firm said “sales were a slight miss, however core EPS beat consensus expectations by 20%, driven by a better-than-expected tax rate and gross margin, and some cost control.”

Amid the guidance boost, Berenberg said it increased its estimates for Bristol-Myers Squibb’s results through 2020.

Still, the firm added: “Despite these upgrades we continue to believe that overexposure to news flow in [immune-oncology] means the risk/reward profile of the shares is less attractive than other large-cap peers.” It noted a drop of about 20% in the share price over the last few weeks places Bristol at a slight discount to the sector on a price-to-earnings basis for the first time in a long time, but said the firm does “not think this is a reason to buy the shares at present.”

Thursday, Bristol-Myers Squibb reported Q3 adjusted EPS of $1.09, up from $0.75 a year earlier and above analysts’ mean estimate according to Capital IQ of $0.91. Total revenue came in at $5.69 billion, up from the year-earlier period’s $5.25 billion, but missed analysts’ mean estimate of $6.72 billion.

For the year, the company said it now expects adjusted EPS of $3.80 to $3.90, up from its previous guidance range of $3.55 to $3.65. The boost includes a new forecast for worldwide revenue to be up in the high-single digits on a percentage basis, up from its prior guidance for an increase in the mid- to high-single digits.