Relatively small up-and-comer or big, established winner? That's basically the choice investors have when it comes to choosing between Exelixis (NASDAQ:EXEL) and Bristol-Myers Squibb (NYSE:BMY). While the two drugmakers are very different, they also share several things in common. For example, both companies market cancer drugs that are major success stories, and both stocks have performed quite well over the last 12 months.

But which of these two pharma stocks is the better pick for long-term investors? Here are the best arguments for both Exelixis and Bristol-Myers Squibb.

Boxing glove coming out of pill to punch cancer cell

Image source: Getty Images.

The case for Exelixis

Cabometyx. In a word, that's the best reason to buy Exelixis stock. Sales are soaring for the cancer drug. Exelixis won FDA approval in 2016 for Cabometyx as a second-line treatment for renal cell carcinoma, the most common form of kidney cancer. In December 2017, the drug gained FDA approval as a first-line treatment for the disease.

This second approval should be enormously important for Exelixis. The first-line kidney cancer market has nearly as many patients than the second-line and third-line indications combined. Exelixis could have another approval on the way soon: The company plans to submit for approval of Cabometyx in treating liver cancer before the end of March.

There are also opportunities for combinations featuring Cabometyx. One such combination could be with Bristol-Myers Squibb's Opdivo. Exelixis and BMS are evaluating combos of Cabometyx with Opdivo and/or Yervoy as a first-line treatment of kidney cancer. With both monotherapy and combination possibilities, some analysts project that Cabometyx could eventually generate peak annual sales in the U.S. of $2 billion. 

But Cabometyx isn't the only reason to buy Exelixis stock. The company's MEK inhibitor Cotellic could also become a big winner. Cotellic won approval in 2015 in combination with Roche's (NASDAQOTH: RHHBY) Zelboraf for treating advanced melanoma. Sales haven't been anything to get excited over so far. However, there could be a better chance for success with another of Roche's drugs. Roche has several late-stage clinical studies in progress evaluating a combination of Tecentriq with Cotellic in treating melanoma and colorectal cancer. 

Cabometyx by itself should provide great earnings growth for Exelixis over the next few years. Good news from Roche's studies of the Tecentriq/Cotellic combo could add to that growth. And now that Exelixis is profitable, it will likely invest in its pipeline by either licensing or acquiring additional assets. The bottom line is that Exelixis should remain a strong growth stock into the future.

The case for Bristol-Myers Squibb

There isn't a one-word case to be made for buying Bristol-Myers Squibb stock. It takes at least four words -- Opdivo, Eliquis, and cash flow.

Opdivo made nearly $5 billion last year, up 31% from 2016. Market research firm EvaluatePharma projects that it will be the No. 2 best-selling cancer drug in the world by 2022, with sales approaching $10 billion. The main way that sales for Opdivo could double in five years is through combinations with other drugs.

It doesn't hurt that Opdivo is joined in BMS's lineup by a couple of other blockbuster cancer drugs. Leukemia drug Sprycel raked in over $2 billion last year, a 10% year-over-year increase. Sales for Yervoy jumped 18% to $1.2 billion.

The pharma company's product with the best sales growth, though, is Eliquis. The anticoagulant, which BMS co-markets with Pfizer, achieved an impressive 46% year-over-year gain in 2017, with sales of nearly $4.9 billion.

Success for Opdivo, Eliquis, and Bristol-Myers Squibb's other top drugs enable the company to generate solid cash flow. Investors should like what BMS is doing with that cash flow. It pays a nice dividend with a current yield of 2.51%. The company is also looking to use its financial flexibility to make smart strategic deals, most recently buying a stake in and partnering with Nektar Therapeutics.

Better buy

Bristol-Myers Squibb has more arrows in its quiver than Exelixis does. The stock also looks less expensive, with a forward earnings multiple half as large as Exelixis'. And there's the solid dividend that BMS offers, whereas Exelixis doesn't pay a dividend.

So, is Bristol-Myers Squibb the better buy? I like the stock in general, but the company also has a few challenges. Sales for BMS's older drugs, including its hepatitis C franchise, are sinking. As a result, BMS projects revenue growth for 2018 only in the low- to mid-single-digit percentages.

Exelixis, on the other hand, doesn't have much baggage to speak of. While the stock does trade at nearly 38 times expected earnings, factoring in Exelixis' strong growth prospects makes the valuation look much more attractive. 

Bristol-Myers Squibb is definitely the better pick for income investors. But if you're looking for growth, I'd go with Exelixis.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.