Credit Suisse: We Prefer Pfizer, Bristol Over Pharma Peers

Credit Suisse reviewed its stances on major US pharma names in a note this week, though the analysts came to the same conclusion that Bristol-Myers Squibb Co BMY and Pfizer Inc PFE were the best in class. The analysts also noted that they have an Outperform rating on AbbVie Inc ABBV.

Alongside this analysis, Credit Suisse increased its price targets for Bristol-Myers, from $70 to $75, Pfizer, from $36 to $37, while leaving its AbbVie price target unchanged at $69. The analysts also increased their price targets for Eli Lilly and Co LLY by $1 to $72 and Merck & Co., Inc. MRK by $2 to $62. Credit Suisse rated both of those stocks at Neutral.

For Bristol-Myers, the analysts pointed to the early stop of its CheckMate ‘057 Opdivo trial study as reason to increase its near-term immuno-oncology estimates. Based on a discounted cash flow analysis, Credit Suisse forecasted operating margins of 45 percent in 2023, driven by a 1.5 percent "terminal growth rate."

Likewise, the early stop of Pfizer's PALOMA-3 trial from positive results has Credit Suisse increasing both the near- and long-term estimates of Ibrance. The analysts said that its estimates and outlook does not include Pfizer's acquisition of Hospira, Inc. HSP.

Arguably, Credit Suisse is least optimistic on Johnson & Johnson JNJ, revising its price target lower to $108, from $110 prior. That price target does still reflect 8 percent upside in the stock, however.