Bristol-Myers Squibb Company’s shares were trading at $49 with a trailing P/E of 16.6 and a forward P/E of 8. Valuation work suggests the stock is undervalued by about 20%, potentially offering an annual alpha of 7% over three years. The company’s revenue has grown steadily, reaching $42.5 billion in 2020 after the Celgene acquisition.

Based on a valuation model, BMY’s intrinsic value is estimated to be between $47 and $59, compared to the current price of $46. Despite modest undervaluation, the author recommends waiting for a deeper discount due to limited growth visibility and execution risk. Previous bullish theses on BMY have not played out, leading to a 22% stock depreciation.

While 67 hedge fund portfolios held BMY at the end of the second quarter, the company is not among the 30 most popular stocks among hedge funds. Despite potential as an investment, certain AI stocks offer greater upside potential with less downside risk. Check out a free report on the best short-term AI stock for more information.

Read more at Yahoo Finance: Bristol-Myers Squibb Company (BMY): A Bull Case Theory