Shares of Bristol popped 2 percent early Monday after a Bloomberg report said Starboard Value had taken a stake in the New York-based pharmaceutical giant. The size of the stake and plans that the activist hedge fund might have for its investment couldn't be immediately learned, according to Bloomberg.
Bristol's shares turned negative after Faber, citing unnamed sources, said Starboard hasn't contacted Bristol's management yet.
Starboard Value and Bristol didn't immediately respond to requests for comment.
Last month, Bristol announced plans to acquire cancer drug maker Celgene in a cash-and-stock deal valued at $74 billion. Buying Celgene is seen as giving Bristol more cancer drugs at a time when its immuno-oncology portfolio struggles to keep up with rival Merck's.
The initial news sent the cost to insure Bristol's bonds to their highest point since May 2010. As the price of long-term Bristol bonds fell, the associated credit default swap jumped 66 percent, bringing the cost to insure $1 million of the company's debt against default to $23,000, according to Reuters.
Shares of Bristol are down by about 4 percent since the beginning of the year. The stock is down more than 20 percent over the past 12 months.
Correction: CNBC's David Faber said Bristol-Myers Squibb had not formally heard from activist hedge fund Starboard Value about reports of a stake in the company. An earlier version mischaracterized his comments.