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What to Expect from Bristol-Myers Squibb’s Earnings in 2019

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Earnings guidance

Bristol-Myers Squibb (BMY) expects to report GAAP EPS in the range of $3.05 to $3.15 and non-GAAP EPS in the range of $3.80 to $3.90 for fiscal 2018, $0.25 higher than the prior guidance.

On January 3, 2019, the company issued a press release announcing EPS guidance for fiscal 2019. The company expects to report GAAP EPS in the range of $3.75 and $3.85, and non-GAAP EPS in the range of $4.10 to $4.20 for fiscal 2019. According to the press release, this guidance doesn’t include EPS contributed by Celgene (CELG) after the completion of its acquisition by Bristol-Myers Squibb. According to the press release, the guidance, however, includes a $0.09 per share impact due to the divestiture of the over-the-counter (or OTC) drugs business in France, Upsa, as well as transactions related to US pension liabilities.

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EPS projections

Wall Street analysts have projected Bristol-Myers Squibb’s non-GAAP EPS to be $3.87, $4.10, and $4.51 for fiscal 2018, fiscal 2019, and fiscal 2020, respectively, which implies a YoY growth rate of 28.68%, 5.95%, and 9.81% for fiscal 2018, fiscal 2019, and fiscal 2020, respectively. These estimates don’t include the impact of the pending Celgene acquisition.

Celgene acquisition

According to the company’s press release, Bristol-Myers Squibb’s acquisition of Celgene is expected to boost the former’s standalone EPS by more than 40%. According to the press release, the internal rate of return of this transaction is also higher than the cost of capital of both companies, thereby highlighting value generation potential of the deal. This transaction is expected to complete in the third quarter of 2019.

In the next article, we’ll discuss cost projections for Bristol-Myers Squibb in greater detail.

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