Giants in distress sometimes make attractive investment options, but often investors rush to buy them too soon.

Whether it's McDonald's(NYSE: MCD) or AT&T(NYSE: T), when a big company founders, there's usually plenty of time to wait and watch for signs of recovery before buying shares.

Drug giant Bristol-Myers Squibb(NYSE: BMY) is no exception. The stock has lost 60% over the last two years, and now trades at 15 times '03 earnings estimates and pays a 4.4% dividend yield. Those numbers may be awfully tempting, but hold your ponies. The company has been trampled for a reason.

One issue was resolved today. Twenty-nine states, generic drug makers, and pharmacy chains sued the drug maker for antitrust allegations regarding two of its drugs: anti-anxiety drug BuSpar and anticancer drug Taxol. The claim is the company kept cheaper, generic drugs from customers by filing misleading, last-minute patents. Management stands by its actions but agreed to settle. It'll pay an additional $580 million (it already coughed up $90 million).

The largest concern for investors, though, is the company's accounting. After "irregularities," Bristol-Myers is slated to restate earnings for the last several years. Until it does, there's no way of knowing its current value. Meanwhile, the Securities and Exchange Commission is investigating possible sales-figure manipulation.

The company has the cash to pay the $600 million, and it has a strong product line despite recent drug expirations. But it's probably best to wait for the restated numbers -- and build trust in management -- before buying the stock. This is one to put on your watch list, though, if you're interested in a $55 billion pharmaceutical company with a strong yield and one that could be well-priced when the clouds start to clear.