Over the past few years, Bristol Myers Squibb (BMY +3.44%) and Pfizer (PFE +1.38%), have underperformed broader equities. However, throughout it all, they have maintained their dividend programs intact and currently boast high yields. Bristol Myers' forward yield is a healthy 4.4%, while Pfizer's is even juicier at 6.6%. Neither company is out of the woods yet, though, as both still have challenges ahead, notably patent cliffs. Which one is the safer bet today for dividend seekers? Let's find out.
Image source: The Motley Fool.
The case for Bristol Myers Squibb
Bristol Myers will lose patent exclusivity for Opdivo -- a cancer medicine -- and Eliquis, an anticoagulant it co-markets with Pfizer, by the end of the decade. These two are among the company's best-selling drugs. However, Bristol Myers could overcome these obstacles. The drugmaker's newer, subcutaneous formulation of Opdivo will help attract many older patients and offset losses from biosimilar competition, as it is much easier and faster to administer while still being about as effective.
NYSE: BMY
Key Data Points
Bristol Myers is also working on a next-gen anticoagulant, milvexian. This medicine could address a key risk of traditional blood thinners, bleeding, and target many patients who are undertreated due to this potential side effect. Overall, Bristol Myers has a deep pipeline across oncology, immunology, and other therapeutic areas. The company also has a portfolio of newer drugs, some of which, like Reblozyl for anemia in patients with beta-thalassemia, are posting strong sales growth.
Lastly, Bristol Myers has increased its dividends by 65.8% over the past decade. The company still looks like a top pick for dividend seekers.
The case for Pfizer
Besides Eliquis, Pfizer will lose patent exclusivity for other medicines by the end of the decade, including its cancer drug Ibrance. However, the company has newer products that are performing well. One of them is Abrysvo, a vaccine for the respiratory syncytial virus. Pfizer also has a deep pipeline that should yield tangible results over the next few years. The company plans to launch about 20 pivotal studies this year, after starting quite a few in 2025.
NYSE: PFE
Key Data Points
Some of Pfizer's candidates look promising. The company's investigational weight loss medicine, MET-097i, is one of them. Another is Pfizer's next-gen cancer drug, PF'4404. Provided Pfizer can make solid progress with these programs (and others), the company's shares could recover. Lastly, Pfizer continues to increase its dividend, which is up 51.3% over the past 10 years. The stock may not have performed well over the last half-decade, but it could handsomely reward patient investors who stick with it for the long term.
Which is the better buy
Between these two stocks, I would give Bristol Myers a slight edge right now, as its newer product portfolio looks better than Pfizer's. Bristol Myers also seems more prepared to overcome upcoming patent cliffs, especially that of Opdivo, thanks to the newer version of the drug. Further, Bristol Myers has grown its dividend faster over the past decade. Overall, it looks like a better income stock. However, those on the market for attractive, blue chip dividend stocks cannot go wrong with either company.
