Is Bristol-Myers Squibb Stock A Safe Haven During Tariff Turmoil?

April 4th, 2025 by Trefis Team

While the broader markets have recently experienced a downturn, with a significant 5% drop on Thursday, April 3rd, due to higher-than-anticipated tariffs imposed by the Trump administration, pharmaceutical stocks have generally outperformed. This is because they often act as a defensive play during uncertain macroeconomic times, and currently, pharmaceuticals are not subject to these tariffs. Against this backdrop, we believe Bristol-Myers Squibb (NYSE:BMY) stock, currently trading around $57, appears to be a good buy, although it’s important to acknowledge inherent risks. Our conclusion stems from a comparison of BMY’s current valuation with its operating performance over recent years, as well as its current and historical financial condition. Our analysis across key parameters—Growth, Profitability, Financial Stability, and Downturn Resilience—indicates that the company exhibits moderate operating performance and financial health, as detailed below. For a more comprehensive understanding of the tariffs and their broader market impact, please refer to our analysis on market crash risk.

 

Image by Ri Butov from Pixabay

How Does Bristol-Myers Squibb’s Valuation Look vs. The S&P 500?

Going by what you pay per dollar of sales or profit, BMY stock is currently valued in line with the broader market.

  • Bristol-Myers Squibb has a price-to-sales (P/S) ratio of 2.5 vs. a figure of 3.2 for the S&P 500
  • Additionally, the company’s price-to-operating income (P/EBIT) ratio is 20.6 compared to 24.3 for S&P 500
  • And, it has a price-to-earnings (P/E) ratio of 8.0 vs. the benchmark’s 24.3

How Have Bristol-Myers Squibb’s Revenues Grown Over Recent Years?

Bristol-Myers Squibb’s Revenues have seen some growth over recent years.

  • Bristol-Myers Squibb has seen its top line grow at an average rate of 1.4% over the last 3 years (vs. increase of 6.3% for S&P 500)
  • Its revenues have grown 7.3% from $45 Bil to $48 Bil in the last 12 months (vs. growth of 5.2% for S&P 500
  • Also, its quarterly revenues grew 7.5% to $12 Bil in the most recent quarter from $11 Bil a year ago (vs. 5.0% improvement for S&P 500)

 

How Profitable Is Bristol-Myers Squibb?

Bristol-Myers Squibb’s profit margins are higher than most companies in the Trefis coverage universe.

 

Does Bristol-Myers Squibb Look Financially Stable?

Bristol-Myers Squibb’s balance sheet looks weak.

  • Bristol-Myers Squibb’s Debt figure was $51 Bil at the end of the most recent quarter, while its market capitalization is $116 Bil (as of 4/3/2025). This implies a poor Debt-to-Equity Ratio of 42.3% (vs. 19.0% for S&P 500). [Note: A lower Debt-to-Equity Ratio is desirable]
  • Cash (including cash equivalents) makes up $11 Bil of the $93 Bil in Total Assets for Bristol-Myers Squibb.  This yields a moderate Cash-to-Assets Ratio of 11.7% (vs. 14.8% for S&P 500)

 

How Resilient Is BMY Stock During A Downturn?

BMY stock has seen an impact that was slightly better than the benchmark S&P 500 index during some of the recent downturns. Worried about the impact of a market crash on BMY stock? Our dashboard How Low Can Bristol-Myers Squibb Stock Go In A Market Crash? has a detailed analysis of how the stock performed during and after previous market crashes.

Inflation Shock (2022)

  • BMY stock fell 11.3% from a high of $81.13 on 4 December 2022 to $71.99 on 28 December 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
  • The stock is yet to recover to its pre-Crisis high
  • The highest the stock has reached since then is $74.53 on 6 February 2023 and currently trades at around $57

 

COVID-19 Pandemic (2020)

  • BMY stock fell 29.4% from a high of $65.71 on 19 February 2020 to $46.40 on 23 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
  • The stock fully recovered to its pre-Crisis peak by 14 January 2021

 

Global Financial Crisis (2008)

  • BMY stock fell 42.5% from a high of $30.02 on 30 October 2007 to $17.26 on 16 October 2008, vs. a peak-to-trough decline of 56.8% for the S&P 500
  • The stock fully recovered to its pre-Crisis peak by 16 September 2011

Putting All The Pieces Together: What It Means For BMY Stock

In summary, Bristol-Myers Squibb’s performance across the parameters detailed above are as follows:

  • Growth: Strong
  • Profitability: Strong
  • Financial Stability: Weak
  • Downturn Resilience: Neutral
  • Overall: Neutral

Our analysis reveals a moderate operating performance and financial condition for BMY, which aligns with its current moderate valuation. The company is proactively addressing the challenge of biosimilar competition for its established drugs by investing in and developing new growth drivers. The recent approval of Cobenfy and the potential of its drug pipeline are positive indicators. While we acknowledge the near-term risks associated with biosimilar competition and the evolving tariff landscape, as well as BMY’s own moderate historical performance, we believe the current stock price adequately reflects these concerns, making BMY a good stock to buy at this level.

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