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Will Bristol-Myers Squibb (BMY) Disappoint This Earnings Season?

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Bristol-Myers Squibb Company (BMY - Free Report) is scheduled to report second quarter 2014 results before the opening bell on Jul 24. Last quarter, Bristol-Myers had posted an earnings surprise of +4.55%. Let’s see how things are shaping up for this announcement.

Factors at Play

Although pipeline development by Bristol-Myers will increase its research and development expenses, strong performance from Sprycel, Yervoy and Orencia will boost revenues.

However, continued generic competition faced by Sustiva will affect sales. The company is also making additional investments for the commercialization of Eliquis, which will add to its SG&A expenses. We expect Bristol-Myers to provide a detailed update on its pipeline while releasing its second quarter results.

Earnings Whispers?

Our proven model does not conclusively show that Bristol-Myers Squibb is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP (Expected Surprise Prediction) and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: The Earnings ESP for Bristol-Myers Squibb is -2.27% since the Most Accurate estimate is $0.43 while the Zacks Consensus Estimate is $0.44 per share.

Zacks #3 Rank (Hold): Bristol-Myers Squibb’s Zacks Rank #3 (Hold) has little effect on the predictive power of ESP because the Zacks Rank #3 when combined with a negative ESP makes surprise prediction difficult.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows that they have the right combination of elements, i.e., a positive Zacks Earnings ESP and a Zacks Rank #1, #2 or #3.

Endo International (ENDP - Free Report) has an earnings ESP of +4.49% and carries a Zacks Rank #2. Endo will report second quarter earnings on Jul 31 before market opens.

Mallinckrodt (MNK - Free Report) has an Earnings ESP of +2.33% and holds a Zacks Rank #1. Mallinckrodt will report third quarter earnings on Aug 7 before market opens.

Impax Laboratories (IPXL - Free Report) has an Earnings ESP of +26.83% and holds a Zacks Rank #3. Impax will report second quarter earnings on Aug 6 before market opens.

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