Biopharma giant Bristol-Myers Squibb is today's IBD Screen Of The Day, showing growing mutual fund ownership. According to the CAN SLIM stock picking method, when mutual funds buy a stock, they have already assessed its price performance, recent earnings growth and profitability.
BMY stock is probing the 80.69 buy point of a cup base and is near an all-time high. It built the base over nearly 20 weeks, which is impressive, showing underlying support through an extended time period.
The relative strength line, which compares performance with the S&P 500, is at a 52-week high, marking additional support for the bullish outlook. Shares have risen for five straight days, ahead of the potential breakout.
BMY ranks 3rd in the Medical-Ethical Drugs group. It has an 86 Composite Rating, 92 Relative Strength Rating and rock-solid "A" SMR Rating, showing its ability to grow through increasing sales, profits and return of shareholder's equity in the most recent quarters.
Mutual funds own 45% of outstanding shares, supporting the solid "B-" accumulation/distribution rating. This indicates good buying interest among fund managers.
$11.2 billion in Q3 sales marked a slight decline, compared to last year, while earnings of $1.99 per share grew 3% over the same period. Revenue from new products surged 66% to $553 million.
The company maintained its 2022 outlook, expecting earnings of $7.44 to $7.74 per share.
The company acquired Turning Point Therapeutics during the quarter, adding the biotech's winning drug for non-small cell lung cancer patients to the product portfolio.
Solid Biopharma Earnings Despite Exclusivity Loss
Sales of the biopharma's top cancer drug and biggest cash generator Revlimid declined 28% in the quarter. The company expects to lose significant market share as a result of the loss of exclusivity.
The drug, which is used to treat multiple myeloma, now faces competition from Teva Pharma's generic version. However, Revlimid generic substitutes will face volume restrictions until 2026.
To compensate, it has launched nine new products in the last three years, for anemia, multiple sclerosis and acute blood cancer.
Meanwhile, in the third quarter, New York-based Bristol-Meyers got FDA approval for Sotyktu, a treatment for plaque psoriasis.
Among exchange traded funds, First Trust Nasdaq Pharmaceutical ETF and VanEck Pharmaceutical ETF hold shares.
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