Bristol Myers Squibb Initiates $5B Accelerated Share Repurchase

Global pharmaceutical company Bristol Myers Squibb (NYSE: BMY) has started an accelerated share repurchase to buy back shares worth $5 billion.

Following the news, shares of the company gained around 1% in the pre-market trading session at the time of writing the article.

Details of the Buybacks

The current buyback will be part of the previously authorized repurchase programs of $15 billion.

Upon completion of the current accelerated program, which is expected to settle during the second and third quarters of 2022, $10.2 billion is expected to remain outstanding under the $15 billion program.

Today, the company will receive 85% of its shares. The company will finance the buybacks by utilizing available cash in hand.

The total number of shares repurchased will be based on a discount to the volume-weighted average price of Bristol-Myers Squibb’s common stock during the terms of the transactions.

Wall Street’s Take

Following the recent Q4 earnings, Goldman Sachs analyst Chris Shibutani increased the price target on the stock to $76 (15.3% upside potential) from $74 and reiterated a Buy rating.

Shibutani believes that the company’s growing portfolio is underappreciated by the market based on new product launches as well as key pipeline assets.

He stated, “Data from the Phase 2 study for Milvexian (Factor XIa inhibitor) in secondary stroke prevention (SSP) in the 2H22 has the potential to further confidence in BMY’s late-decade revenue profile (pending data, currently represents upside to our model).”

The rest of the Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 5 Buys and 3 Holds. The average Bristol Myers Squibb stock price projection of $68 implies that the stock has 3.2% upside potential from current levels. Shares have gained 10% over the past year.

Bloggers Weigh In

TipRanks data shows that financial blogger opinions are 93% Bullish on BMY stock, compared to a sector average of 70%.

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