Earnings Cheat Sheet: Solid Earnings but Flat Sales for Bristol Meyers Squibb

Bristol Meyers Squibb beat expectations in its earnings report today, but shares fell in early morning trade along with the broader market.

The company reported solid earnings for the third quarter and reaffirmed 2010 eps guidance in the range of $1.84 to $1.94 per share (GAAP) and $2.10 to $2.20 per share (non-GAAP). Sales, however, remained relatively flat.

If you are looking for a well-managed company with good returns, high gross margins, and solid prospects, BMY could fit the bill, even with potential adverse effects from health care reform. And despite substantial investment in R&D, the company is sitting on a mound of cash and pays a nice 4.7 percent dividend to boot.

Here’s your Earnings Cheat Sheet for Bristol Meyers Squibb (BMY).

Third-Quarter Earnings: Up 15 percent (yoy) to $0.55 from $0.48 (diluted); up 26 percent from continuing operations (non-GAAP diluted) for $0.59 eps.

Revenues: About even (up .2 percent yoy) from $4,788M in 2009 to $4,798M this quarter

Actual vs. Expected: Consensus Estimates pegged eps at $0.53 this quarter

Notable Stats: The company attributed a negative 1.6 percent drop in sales to health care reform here in the US, reducing eps by about $0.02 for the quarter. US sales climbed 4 percent in the quarter and international sales dropped 6 percent. The company trimmed expenses but gross margin declined slightly. Net cash (including securities) sits at $4.2B.

Core Product Updates: Sales of PLAVIX rose 7%, BARACLUDE(R) rose 19%, SUSTIVA(R) rose 9%, and REYATAZ(R) rose 4%. Third-quarter sales of SPRYCEL(R) and ORENCIA grew 35% and 14% respectively compared to the same period in 2009. In Japan, ORENCIA was approved for the treatment of rheumatoid arthritis. The following treatments are also under study, application, or review: SPRYCEL for chronic myeloid leukemia; ipilimumab for the treatment of adult patients with advanced melanoma; ELIQUIS(R) (apixaban), a preventative, for stroke or embolism; dapagliflozin, for Type 2 diabletes; and BARACLUDE for the treatment of chronic hepatitis B in adults with decompensated liver disease.

Key Quotes: “The third quarter continued to highlight the excellent progress we are making with our innovative pipeline, an important driver in the success of our differentiated and focused BioPharma strategy,” Lamberto Andreotti, chief executive officer, Bristol-Myers Squibb, said.

Competitors: Ely Lilly & Co (LLY) and Pfizer, Inc. (PFE)

BMY acquired ZymoGenetics, Inc., the Seattle-based biotech company, in October.

Technicals: The share price just edged above its 13-day EMA but is still trading in the doldrums for the month on declining volume. The stock has some room to move upward (analyst put a high estimate for the stock at over $31) providing the market cooperates, but that’s a big IF. MACD continues to decline. And with insider selling of 31 million shares and a mixed earnings report, investors seeking long positions will most likely be looking elsewhere.

Bristol Meyers Squibb (NYSE: BMY)

Disclosure: No positions in BMY