Bristol Myers Squibb on Thursday reported better-than-expected quarterly results, but weak guidance for 2025 sent shares lower. Jim Cramer’s faith in the drugmaker is unshaken. Revenue in the fourth quarter rose 8% year over year to $12.34 billion, well ahead of the $11.57 billion consensus, according to analysts’ estimates compiled by LSEG. Adjusted earnings per share (EPS) of $1.67 in the three months ended Dec. 31 topped estimates of $1.46, LSEG data showed. On an annual basis, adjusted EPS declined 1.8%. Bristol Myers Squibb (BMY) Why we own it: The company’s new schizophrenia treatment Cobenfy has immense sales potential, though it remains in the early innings. Bristol Myers has key products, such as blood-clot prevention drug Eliquis and lung-cancer therapy Opdivo, which will be coming off patent in the coming years. However, we believe its portfolio of growth drugs including Cobenfy can help navigate that patent cliff. Initiation: Nov. 25, 2024 Most recent buy date: Jan. 17, 2025 Competitors: AbbVie , Pfizer , Amgen , Johnson & Johnson and Merck Bottom line The slide in Bristol Myers’ stock Thursday — down more than 4.5% at session lows below $57 — is a gift for long-term investors. We’re reiterating our buy-equivalent 1 rating and price target of $70 a share. Bristol Myers shares were later able to recover some, down roughly 2% in late morning trading. ” It’s a buy,” Jim said on CNBC’s “Squawk on the Street” on Thursday morning. “I was praying this [sell-off] would happen so I could go in and buy a little more.” The Club can’t buy because we’re restricted but that doesn’t stop us from telling members what we would do. Jim later said on the Morning Meeting, “You have to stand there and buy it hand over fist.” BMY 1Y mountain Bristol Myers Squibb 1 year The crux of our thesis in Bristol Myers is Cobenfy, the company’s new schizophrenia treatment that launched in the U.S. at the end of last year. It’s off to a good start, tallying fourth-quarter sales of $10 million on the drug. On Thursday’s earnings call, executives sounded pleased with the feedback they’re getting from physicians and patients on Cobenfy as well as the level of insurance coverage the drug has secured thus far. “This is the first new mechanism of action in decades in the treatment of schizophrenia. And so we’re out with our teams, educating customers on Cobenfy’s differentiated profile, and we’re breaking reflexive prescribing habits, and that’s going to take some time,” Chief Commercialization Officer Adam Lenkowsky said on the call. “So, we would expect to see continued strong uptake through 2025 … with a ramp in the back half of this year. But taken together, we are really pleased what we’re seeing so far. And we plan to make this a very big product for the company over time.” Expanding the prescription label on Cobenfy to include other conditions can help the drug realize that commercial potential. On that front, Bristol Myers is expecting to two trial readouts this year that can serve as catalysts to drive the stock higher, including a study evaluating its effects on Alzheimer’s disease psychosis. The other data expected this year is for adjunctive schizophrenia, which would widen its prescription opportunity in that disease. Beyond that, Bristol Myers expects at least one clinical trial readout for Cobenfy in each year through the end of the decade, covering conditions such as Bipolar I Disorder and Autism Spectrum Disorder Irritability. Jim reiterated Thursday his view that Cobenfy could be one of the biggest drugs of all time. Bristol Myers’ overall guidance for 2025 certainly left something to be desired, however, with its revenue forecast of approximately $45.5 billion coming in short of the $47.36 billion expected by analysts, according to LSEG. Adjusted EPS guidance of $6.55 to $6.85 also was lighter than the $6.92 consensus. There are a few reasons to look past the miss, though. Chief among them is that blood cancer treatment Revlimid is seeing increased generic competition, which has contributed to the gap between guidance and consensus. Jim said the company has been very up-front about the Revlimid issues, which is why he’s not too concerned. Pomalyst, another of its cancer treatments, also is grappling with a patent expiration in Europe. Indeed, executives said on the call that its portfolio of “legacy drugs,” where its exposure to patent expirations is concentrated, is probably to blame for any guidance miss, coupled with a roughly $500 million foreign exchange headwind that may not have been baked into analysts’ financial models. We also liked that management announced plans to cut up to $2 billion in costs by 2027. This probably won’t be the last time Bristol Myers’ patent cliffs create noise around its results, even if it’s a well-documented part of the story. However, as long as Bristol Myers’ executes on the launch of Cobenfy and its broader “growth portfolio,” which saw a 21% year-over-year sales increase in the quarter,” continues to perform well, there’s reason to believe the stock can keep working. (Jim Cramer’s Charitable Trust is long BMY. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. 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Bristol Myers Squibb on Thursday reported better-than-expected quarterly results, but weak guidance for 2025 sent shares lower. Jim Cramer’s faith in the drugmaker is unshaken.