Value
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.6 |
| P/S | 8.7 |
| EV/EBITDA | 7.0 |
| Fwd P/E | 9.4 |
| PEG | 5.1 |
| Analyst target | 4.0 |
- ▸Forward P/E: 9.4x
- ▸PEG: 1.47
BMY · Why this verdict
Why Bristol-Myers Squibb (BMY) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Four consecutive quarters have come in above consensus estimates, with an average positive surprise of 14% and the most recent beat at 11%, supported by a Piotroski F-Score of 7 out of 9 and free cash flow converting at 135% of net income — indicating operational quality that runs above the income statement alone. Earnings | The beat streak extends to 6 consecutive quarters and free cash flow conversion remains above 100% of net income over the next 12 months. | →Stable |
| CounterAn average surprise of 14% could reflect analysts consistently setting conservative estimates; if top-line growth remains muted, any guidance-setting normalization could break the streak without a change in underlying business performance. | ||
With only 0.9% remaining headroom to the price target and a risk/reward ratio well below the minimum bar for a new position, the operational story has been largely recognized by the market at current prices — the setup favors patience over new capital deployment. Price targets | Price declines below $50.00, creating more than 13% upside to the current price target and reopening a favorable entry setup. | →Stable |
| CounterIf analyst targets are revised higher on the back of continued earnings beats, the apparent ceiling rises and the current price could still represent positive expected value for a longer holding horizon. | ||
A dividend payout ratio of 448% of earnings — flagged as a yield trap with an unsafe payout — combined with a debt-to-equity ratio of 2.3x leaves the capital structure exposed if cash generation softens, since the distribution appears to require sources beyond current net income to sustain. Catalyst breakdown | The dividend payout ratio falls below 100% of earnings for 2 consecutive quarters, demonstrating that earnings growth has caught up with the distribution commitment. | →Stable |
| CounterThe 135% free cash flow conversion rate indicates more cash is generated than the GAAP earnings line implies; a high dividend payout relative to net income may not signal the same stress as it would in a cash-poor business. | ||
Momentum is at the minimum acceptable threshold — at the floor rather than comfortably above it — with on-balance volume falling, indicating that distribution rather than accumulation is occurring despite the stock remaining above its 200-day moving average. Momentum breakdown | RSI rises above 60 and on-balance volume turns consistently positive for 4 consecutive weeks, signaling renewed buyer participation. | →Stable |
| CounterWith RSI at 43 mid-range and the stock still above its 200-day moving average, the momentum weakness is not yet oversold; a modest catalyst such as an earnings beat could quickly re-engage buyers without a meaningful price decline first. | ||
Four consecutive quarters have come in above consensus estimates, with an average positive surprise of 14% and the most recent beat at 11%, supported by a Piotroski F-Score of 7 out of 9 and free cash flow converting at 135% of net income — indicating operational quality that runs above the income statement alone.
→StableEarnings
- Expectation
- The beat streak extends to 6 consecutive quarters and free cash flow conversion remains above 100% of net income over the next 12 months.
CounterAn average surprise of 14% could reflect analysts consistently setting conservative estimates; if top-line growth remains muted, any guidance-setting normalization could break the streak without a change in underlying business performance.
With only 0.9% remaining headroom to the price target and a risk/reward ratio well below the minimum bar for a new position, the operational story has been largely recognized by the market at current prices — the setup favors patience over new capital deployment.
→StablePrice targets
- Expectation
- Price declines below $50.00, creating more than 13% upside to the current price target and reopening a favorable entry setup.
CounterIf analyst targets are revised higher on the back of continued earnings beats, the apparent ceiling rises and the current price could still represent positive expected value for a longer holding horizon.
A dividend payout ratio of 448% of earnings — flagged as a yield trap with an unsafe payout — combined with a debt-to-equity ratio of 2.3x leaves the capital structure exposed if cash generation softens, since the distribution appears to require sources beyond current net income to sustain.
→StableCatalyst breakdown
- Expectation
- The dividend payout ratio falls below 100% of earnings for 2 consecutive quarters, demonstrating that earnings growth has caught up with the distribution commitment.
CounterThe 135% free cash flow conversion rate indicates more cash is generated than the GAAP earnings line implies; a high dividend payout relative to net income may not signal the same stress as it would in a cash-poor business.
Momentum is at the minimum acceptable threshold — at the floor rather than comfortably above it — with on-balance volume falling, indicating that distribution rather than accumulation is occurring despite the stock remaining above its 200-day moving average.
→StableMomentum breakdown
- Expectation
- RSI rises above 60 and on-balance volume turns consistently positive for 4 consecutive weeks, signaling renewed buyer participation.
CounterWith RSI at 43 mid-range and the stock still above its 200-day moving average, the momentum weakness is not yet oversold; a modest catalyst such as an earnings beat could quickly re-engage buyers without a meaningful price decline first.
TrendMatrix Research · core thesis
Engine thesis — one sentence
A high-quality pharmaceutical franchise with a Piotroski F-Score of 7 out of 9, 135% free cash flow conversion, and four consecutive earnings beats averaging 14% above estimates is priced with just 0.9% headroom to the price target; momentum is at the minimum threshold with falling on-balance volume, and a 448% dividend payout ratio cannot be sustained from current earnings — the setup favors holding an existing position rather than deploying new capital.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 7.1 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 7.5 |
| Current ratio | 5.3 |
| FCF quality | 9.5 |
| Moat | 6.4 |
| Rule of 40 | 3.0 |
| Piotroski F | 7.8 |
- ▸Excellent ROE: 39%
- ▸Strong margins: 15%
- ▸Excellent cash conversion: 135% FCF/NI
- ▸Rule of 40: 23 (fail)
Growth
3.5/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.1 |
| EPS growth | 3.8 |
Momentum
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 4.6 |
| MA position | 9.0 |
| Volume | 1.6 |
- ▸Above 200-day MA
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 2.5 |
| Analyst rating | 7.5 |
| Price target | 6.2 |
- ▸LLM news sentiment: -0.50 (n=4)
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.6 |
| quality rank | 4.9 |
| growth rank | 3.1 |
Technical
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.1 |
| support resistance | 0.2 |
| 52w position | 8.9 |
| gap | 5.0 |
Risk (lower is worse)
7.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.0 |
| days to cover | 7.3 |
| volatility | 6.3 |
| put call | 10.0 |
| implied vol | 6.0 |
| max pain risk | 7.0 |
| beta | 10.0 |
| debt equity | 2.7 |
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 9.5 |
| dividend safety | 5.5 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 434.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.1>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:27d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-0.3=NEGATIVE
- NEWS:LEGAL
Warning (0)
none
Reward-to-Risk
-0.27
Upside
-2.5%
Downside
9.1%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 57, MACD bullish
EdgeCatalyst-Driven — Earnings in 27d with 4/4 beat streak
SuitabilityConservative — Beta 0.23<0.8, Div 434.0%, Q=7.7
Investment implication
The F-path SELL output reflects an overall score of 4.2 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Quality at 7.7) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.3=NEGATIVE, NEWS:LEGAL) reinforce the read. Current asymmetry R:R is -0.27 — supplementary context, not the trigger for this path.
The strongest dimensions are Quality at 7.7, Risk (lower is worse) at 7.3, and Catalyst at 7.2; the weakest are Growth at 3.5, Technical at 3.6, and Peer rank at 4.9. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.27 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Consistent Earnings Beat Quality
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2Fully Priced Limited Room
Trip ifPrice declines below $50.00, creating more than 13% upside to the current price target.
- P3Dividend Payout And Leverage Strain
Trip ifDividend payout ratio falls below 100% of earnings for 2 consecutive quarters.
- P4Momentum At Floor Falling Volume
Trip ifRSI rises above 60 and on-balance volume turns positive for 4 consecutive weeks.