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If you are wondering whether Bristol-Myers Squibb is offering good value right now, this article will walk through what the current share price could mean for long term investors.
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The stock last closed at US$62.37, with returns of 2.8% over 7 days, 14.9% over 30 days, 16.7% year to date, 9.9% over 1 year, 3.2% over 3 years, and 25.9% over 5 years.
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Recent news coverage has continued to focus on Bristol-Myers Squibb as a major player in large cap pharmaceuticals, including ongoing attention on its product portfolio and broader sector sentiment. This context helps frame how investors might be thinking about risk and potential reward at current levels.
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On our valuation checks, Bristol-Myers Squibb scores 5 out of 6. Next we will look at what different valuation methods say about that score, before finishing with an approach that can help you put all those numbers into a clearer story.
Find out why Bristol-Myers Squibb’s 9.9% return over the last year is lagging behind its peers.
A Discounted Cash Flow, or DCF, model takes projections of a company’s future cash flows and discounts them back to today’s dollars, aiming to estimate what the entire business could be worth right now.
For Bristol-Myers Squibb, the model used is a 2 Stage Free Cash Flow to Equity approach. The latest twelve month Free Cash Flow is about $12.9b. Analysts provide detailed estimates for the next few years, and beyond that Simply Wall St extrapolates cash flows to build a 10 year view, including a projected Free Cash Flow of $11.3b in 2030, discounted to today’s value within the model.
Putting all projected and discounted cash flows together gives an estimated intrinsic value of about $120.98 per share. Compared with the recent share price of $62.37, this output suggests the stock is 48.4% undervalued based on this DCF model.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Bristol-Myers Squibb is undervalued by 48.4%. Track this in your watchlist or portfolio, or discover 46 more high quality undervalued stocks.
BMY Discounted Cash Flow as at Feb 2026
For a profitable company like Bristol-Myers Squibb, the P/E ratio is a useful way to think about what you are paying for each dollar of current earnings. Investors usually accept a higher or lower P/E depending on what they expect for future earnings growth and how much risk they see around those earnings.
Bristol-Myers Squibb currently trades on a P/E of 18.0x. That sits below the Pharmaceuticals industry average of about 20.1x and also below the peer average of 21.4x, so the market is currently pricing its earnings at a discount to both its sector and close comparables.
Simply Wall St also calculates a Fair Ratio for the stock. This is the P/E multiple it might trade on given factors such as its earnings profile, industry, profit margins, market cap and company specific risks. This Fair Ratio is 25.3x for Bristol-Myers Squibb, which is higher than the current 18.0x. On this framework, the market price looks lower than what would be implied by those fundamentals.
Result: UNDERVALUED
NYSE:BMY P/E Ratio as at Feb 2026
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Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. Narratives are simply your written story about a company that sits alongside your numbers, such as your assumed fair value and your estimates for future revenue, earnings and margins.
A Narrative ties together three things: how you think Bristol-Myers Squibb’s business story could play out, what that means for a financial forecast, and the fair value that results from those assumptions.
On Simply Wall St, Narratives live in the Community page and are used by millions of investors. You can quickly see how others connect their story about Bristol-Myers Squibb to numbers like expected revenue trends, profit margins and a chosen P/E multiple.
That makes it easier to decide whether you think the stock is attractive by comparing the Fair Value in a Narrative to the current share price. The platform updates those Narratives as new earnings, guidance or news come through.
For Bristol-Myers Squibb today, one Narrative on the optimistic end assumes a fair value of about US$68 per share, while a more cautious Narrative sits closer to about US$40. This shows how two investors can look at the same company and reach very different conclusions based on their story and assumptions.
For Bristol-Myers Squibb, however, we will make it really easy for you with previews of two leading Bristol-Myers Squibb Narratives:
🐂 Bristol-Myers Squibb Bull Case
Fair value in this bullish Narrative: about US$65.00 per share.
Implied discount to this fair value at US$62.37: about 4.0% undervalued.
Revenue growth used in this Narrative: 2.43%.
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Highlights 2024 full year revenues of US$48.3b and Growth Portfolio revenues of US$22.6b, with a focus on newer products such as Eliquis.
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Factors in new product approvals like Opdivo Qvantig and Cobenfy, plus an expanded productivity program targeting about US$2b of extra cost savings by the end of 2027.
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Triangulates fair value using Morningstar’s prior US$66 estimate, a P/E range on 2025 EPS guidance and DCF work that clusters around US$64 to US$66, arriving at about US$65 per share.
🐻 Bristol-Myers Squibb Bear Case
Fair value in this more cautious Narrative: about US$59.91 per share.
Implied premium to this fair value at US$62.37: about 4.1% overvalued.
Revenue trend used in this Narrative: 5.63% annual revenue decline assumption.
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Builds in analyst expectations for revenue to decline over time while profit margins rise toward about 21.5%, with earnings supported by cost efficiencies and pipeline execution.
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Emphasizes risks around patent expiries for key drugs such as Eliquis and Opdivo, pricing pressure, competition in areas like cell and gene therapy and the execution burden from acquisitions and partnerships.
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Anchors fair value around US$60 per share, close to the analyst consensus target of US$53 within a wider US$34 to US$68 range, using a future P/E of about 17x and a discount rate near 7%.
Do you think there’s more to the story for Bristol-Myers Squibb? Head over to our Community to see what others are saying!
NYSE:BMY 1-Year Stock Price Chart
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include BMY.
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