Bristol-Myers Squibb Slumps Over 3%—What’s Behind the Sell-Off?

• BMY shares plummet 3.28% to $46.93, hitting a 52-week low of $39.93.
• Sector peer PFE slips 0.41%, while rival ABBV outperforms with double-digit YTD gains.
• Options volume spikes at the $46–$48 strike range amid merger-driven sector shifts.

The day’s sharp decline contrasts with bullish short-term technicals, sparking questions about whether BMY’s valuation reset or broader sector dynamics are at play.

Negative Sentiment from ABBV Outperformance Drives BMY Decline
Analysts’ preference for AbbVie’s diversified portfolio—bolstered by Skyrizi/Rinvoq momentum and oncology expansion—has overshadowed BMY’s struggles. While BMY’s Cobenfy approval and cost-cutting initiatives provide a floor, the 4.13% 2025 revenue decline estimate and legacy drug erosion (down 20% YTD) amplify concerns. Investors are pricing in execution risks as ABBV’s forward P/E premium (14.76x vs BMY’s 9.72x) signals market favoritism toward perceived stability.

Sector Mixed as Pharma Mergers Spark Rivalry
PharmaCo-MediCorp’s $10B merger and Torrent-JB Pharma consolidation highlight sector consolidation trends, but BMY’s standalone position lacks such catalysts. While PFE’s flat performance reflects broader caution, ABBV’s 11.8% YTD gain underscores investor demand for growth resilience. BMY’s 5.2% dividend yield vs ABBV’s 3.4% offers some comfort, but technicals suggest traders are prioritizing offensive bets over defensive yields.

BMY20250718P47/P46.5 Put Spreads Target Near-Term Weakness
• Bollinger Bands: Current price ($46.93) near lower bound (45.01), suggesting oversold conditions.
• RSI: 65.44—neutral, but dipping from earlier overbought levels.
• MACD: Histogram (0.15) above signal line (-0.38), signaling short-term bullish bias.
• Support/Resistance: 46.78 (30D support) vs 47.16 (200D resistance).

Aggressive traders should focus on the BMY20250718P47 Put ($47 strike, expiring 7/18) and BMY20250718P46.5 Put ($46.5 strike). Both contracts offer:
- BMY20250718P47: Theta (-0.0487) erodes time value swiftly, while gamma (0.295) amplifies gains on downside moves. Turnover of 50,028 contracts ensures liquidity.
- BMY20250718P46.5: Leverage ratio (109.22%) and delta (-0.379) position it as a mid-tier bearish play. Turnover (11,586) supports active trading.

Under a 5% downside scenario to $44.59, P47’s payoff would hit $2.41 (max profit), while P46.5’s payoff reaches $1.94. These contracts exploit the sector’s consolidation fears and BMY’s valuation discount. Action Hook: Bulls should avoid chasing until $47 resistance holds—put spreads dominate until then.

Backtest Bristol-Myers Squibb Stock Performance
The backtest of Bristol-Myers Squibb's (BMY) performance after a -3% intraday plunge shows mixed results. While the 3-day win rate is 47.34%, indicating a slight majority of days with a positive return, the 10-day win rate is higher at 51.85%, suggesting that longer-term returns tend to be more positive. However, the 30-day win rate is slightly below 49.11%, and the maximum return during the backtest period is only 0.05%, which occurs on day 10. This indicates that while BMY has a decent chance of recovering from a significant intraday plunge, the overall returns over various time frames are relatively modest.

BMY Faces Crossroads Amid Sector Shifts—Hold or Fold?
BMY’s near-term fate hinges on whether its pipeline approvals (Cobenfy, xanomeline) offset legacy drag. Technicals suggest a $46.78 support test looms, with PFE’s muted performance underscoring sector-wide caution. Investors must weigh dividend yield against execution risks—hold until BMY proves it can match ABBV’s growth trajectory or sector consolidation sparks a turnaround. Watch the $46.78 floor and 30D resistance ($47.16) for clues—failure risks a slide toward $45.01 (lower Bollinger bound).