Jefferies Upgrade Bristol-Myers Squibb Company (NYSE:BMY)

Jefferies has upgraded Bristol-Myers Squibb to "buy" from "hold" and increased its price target by $7 to $70. This decision comes amid increased confidence in the company’s product pipeline, disciplined spending, and greater clarity on regulatory risks.

The brokerage emphasized the potential of BMY’s schizophrenia drug, Cobenfy, predicting it could surpass $10 billion in revenue.

Jefferies noted the positive momentum from recent product launches, including Cobenfy’s label achieving best-case scenarios. The firm expects stronger-than-anticipated sales for 2024 and 2025.

They also expressed optimism regarding Cobenfy’s trials for Alzheimer’s psychosis, assigning a 70% probability of success for a key Phase 3 study. Furthermore, the drug shows potential in treating bipolar disorder, with trials expected to start in mid-2025.

Despite Bristol-Myers facing risks tied to loss of exclusivity for over 70% of its revenues, Jefferies believes the company’s improved visibility on financial performance and promising pipeline justifies the upgrade.