BRISTOL-MYERS SQUIBB CO (NYSE:BMY) - A solid value pick with strong fundamentals

BRISTOL-MYERS SQUIBB CO (NYSE:BMY) stands out as an undervalued stock with a strong fundamental profile, making it an interesting candidate for value investors. The company, a leader in biopharmaceuticals, scores well on valuation, profitability, and dividend metrics while maintaining reasonable financial health and growth prospects.

Why BMY fits the value criteria

BMY earns a Valuation Rating of 10/10, indicating it is priced attractively compared to peers. With a Price/Earnings ratio of 6.48, well below both industry and S&P 500 averages, the stock appears significantly undervalued. Additionally, its Forward P/E of 7.71 reinforces this assessment.

Profitability is another strong suit, with a Rating of 7/10. BMY boasts impressive margins, including an Operating Margin of 27.11%, outperforming 91.92% of industry peers. Its Return on Equity (31.16%) and Return on Invested Capital (14.88%) also rank highly.

The company offers a dividend yield of 5.00%, well above the industry average (4.20%) and S&P 500 (2.43%). While the payout ratio is high (90.59%), earnings growth supports sustainability.

Financial health is stable, with a Rating of 5/10. BMY maintains a manageable debt-to-FCF ratio (3.80) but has a higher-than-average Debt/Equity ratio (2.67), which investors should monitor.

Growth prospects are mixed, with a Rating of 5/10. While past revenue growth has been solid (13.06% average), future revenue is expected to decline slightly (-4.38%). However, earnings per share are projected to grow by 38.96% annually, suggesting potential upside.

For a deeper dive, review the full fundamental analysis report for BMY.

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Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should always conduct your own analysis before making investment decisions.