Bristol-Myers Squibb Company

(New York Stock Exchange)
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Bullish +62

AbbVie (ABBV) vs Bristol Myers (BMY): Which is a Better Stock to Buy?

Company update AI-generated analysis

πŸ“‰ Bristol Myers Squibb (BMY) trades at a forward P/E multiple of 9.36x, significantly cheaper than AbbVie's 16.39x and Pfizer's 9.67x.

πŸ’° BMY converts 18.87% of revenue into net profit, nearly double AbbVie's 9.80% conversion rate.

πŸ“ˆ The stock has outperformed the sector with a 35.23% gain over twelve months, more than three times AbbVie's return.

πŸ’Έ BMY offers a higher dividend yield of 4.10% compared to AbbVie's 2.66%.

🏭 Bristol Myers maintains a strong 46.60% return on equity despite facing upcoming patent cliffs for Eliquis and Revlimid.

πŸ“‰ Hedge fund holdings in BMY decreased from $5.97 billion to $4.79 billion between Q1 and Q2 2026.

βš–οΈ While AbbVie grows faster at 10.20%, BMY provides better value with double-digit net margins and a lower valuation multiple.

Bullish Signals
  • Bristol Myers Squibb trades at a forward P/E of 9.36x, offering a significant discount compared to AbbVie's 16.39x and the broader S&P 500 average.
  • The company converts 18.87% of revenue into net profit, nearly twice the rate of its rival AbbVie which sits at 9.80%.
  • Shares have appreciated 35.23% over the last twelve months, outperforming AbbVie and signaling market recognition of its value.
  • The stock yields a robust 4.10% dividend, providing higher income potential than AbbVie's 2.66% yield.
  • Bristol Myers achieves a high 46.60% return on equity, demonstrating efficient capital allocation despite patent headwinds.
Risk Factors
  • The company faces an imminent patent cliff with key assets Eliquis and Revlimid facing revenue erosion.
  • Hedge fund interest has declined, with cumulative stake value dropping from $5.97 billion to $4.79 billion in three months.
Full Analysis
The article compares AbbVie (ABBV) and Bristol Myers Squibb (BMY), concluding that while AbbVie has successfully transitioned from Humira with faster revenue growth of 10.20% versus BMY's 5.70%, BMY offers a significantly more attractive valuation. Bristol Myers trades at a forward price-to-earnings multiple of 9.36x compared to AbbVie's 16.39x, making it the cheaper option despite AbbVie's superior operating margin of 40.04% versus BMY's 34.42%. Bristol Myers Squibb (NYSE: BMY) is highlighted as a better-priced stock with a net profit conversion rate of 18.87% against AbbVie's 9.80%, and an equity return of 46.60%. The company yields 4.10% compared to AbbVie's 2.66%, offering higher income potential for investors. However, the analysis notes that BMY faces its own patent cliff ahead with drugs like Eliquis and Revlimid facing erosion, which explains the market discount. Institutional ownership data from Q2 2026 shows Bristol Myers was held by 74 hedge funds with a combined stake value of approximately $4.79 billion, down from $5.97 billion three months earlier. The article suggests that while AbbVie is the stronger operating business, BMY's combination of low valuation, high margins, and dividend yield makes it the superior investment choice for buyers seeking value in the pharmaceutical sector.