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Shortly after the bell opens, we will buy 300 shares of Bristol Myers Squibb at approximately $56.50. Following trading, Jim Cramer’s Charitable Trust will own 1,200 shares of BMY, increasing its weight in the portfolio from about 1.4% to 1.9%. Bad breadth on Wall Street finally catches up. The S&P Short Range Oscillator, our trusty momentum indicator, hit oversold after Friday’s mixed session, falling 4.1%. When the oscillator is oversold, our discipline says it’s time to get opportunistic and buy stocks of quality companies. In Thursday’s edition of Hometretch, we noted that Bristol Myers Squibb’s recent slide into the mid-$50s looked like an opportunity, especially since it meant the stock gave back half of its gains following the failure of schizophrenic rival AbbVie. the drug Jefferies analysts share our bullish long-term view on Bristol Myers. Analysts on Monday upgraded their rating from hold to buy and raised their price target to $70 from $63. Jefferies gave three main reasons for the call, which suggests a 25% upside to the stock’s current price. Analysts believe the drug Cobenfy’s best-in-class schizophrenia drug is on track to become a big hit. They currently model peak sales for the drug at $11 billion, well above the current Wall Street consensus of $6 billion. Jefferies is also increasingly optimistic about Bristol Myers’ pipeline. One drug that analysts highlighted was Milvexian, a blood thinner currently in three late-stage trials for atrial fibrillation, acute coronary syndrome and secondary stroke prevention. Jefferies’ third point was more impressive on the income statement and Bristol Myers had the ability to navigate its next patent cliff, especially from Cobenfy’s higher sales. We agree with all three reasons and believe the stock trades too cheaply at less than 8x 2025 earnings per share with a dividend yield of 4.4%. We first bought Bristol Myers in late November and the latest was added to our position on December 4th. (Jim Cramer’s Charitable Trust is long BMY. See the full list of stocks here.) As a CNBC Investing Club subscriber with Jim. Cramer, you will receive a trade alert before Jim trades. Jim waits 45 minutes after sending a trade alert before buying or selling a share in his charitable trust portfolio. If Jim has talked about a stock on CNBC TV, he will wait 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR SPECIFIC TERMS AND CONDITIONS AND PRIVACY POLICY, WITH OUR DISCLAIMER. NO FIDUCIARY OBLIGATION OR OBLIGATION SHALL BE CREATED, OR CREATED, FOR ANY INFORMATION ENTERED INTO WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
