One problem plagues big pharma: patent expiration. But analysts like the steps Bristol-Myers has taken to offset the revenue loss that occurs when customers can buy cheaper generic versions of its blockbuster treatments. These include partnering up to develop drugs to reduce costs. And Bristol-Myers has a promising pipeline full of high-margin oncology and diabetes treatments. The company also has enough cash ($2.3 billion in net cash) to acquire all or part of a fast-growing biotech. Bristol-Myers has also slashed marketing expenses by 8%, which allowed it to beat analysts' earnings expectations in its most recent quarter. And while investors wait for the company's plans to pay off, they can enjoy a juicy 6.2% dividend yield.
--K.B.
