Our coverage:

Gilead (GILD): why this stock is undervalued

Carla Olson | 2:14 pm ET, 02 May 2018

Gilead (NASDAQ: GILD) is down 8% today in mid-day training.  Upon publishing first-quarter results,  the outlook for the company's hepatitis C medications (where Gilead is seeing increasing competition from AbbVie) and HIV/HBV drugs (hit by Viread generics in HBV and steeper HIV inventory drawdowns) doesn't looks as promising. 

Gilead stock looks slightly undervalued at this point because the market is undervaluing Gilead’s HIV and oncology portfolios.  The company also shows significant potential in the immunology/NASH area. 

Biktarvy (single-table HIV drug) revenues were only $35 million this past quarter.  However, this could easily become Gilead’s largest HIV product, hitting a $5 billion mark (revenues per annum).  

Biktarvy was approved in the U.S.  and is likely to get approved in Europe in the third quarter.  HIV patients are switching from Gilead’s Genvoya (cannibalizing Gilead’s HIV sales) but also from Glaxo’s Tivicay and Triumeq.  So we expect the market share for Gilead's HIV practice to expand.

Over the last year, GILD returned -1.91%. This return is lower than Biotechnology sector (40.58%), Healthcare industry (29.84%), S&P 500 (11.16%) returns.

For the latest news on Gilead, stock price, valuation, and financials, please visit Finstead  (and type "GILD news" or "GILD stock price").  

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


AbbVie (ABBV): Will The Stock Recover?

Carla Olson | 3:28 pm ET, 22 Mar 2018

AbbVie (NYSE: ABBV) diverted the Rova-T program today—and that led to its stock price fall by 13%. 

The program’s objective was to obtain a quick approval for the treatment of third-line refractory small cell lung cancer. 

In 2016, AbbVie pursued an expensive deal to acquire a biotech unicorn Stemcentrx for $5.8 Billion. It had bet on its lead product named Rova-T, which was targeted to approach the proteins that are found in tissues of people who have lung cancer.

After consultation with the FDA, AbbVie won’t try for accelerated approval of Rova-T in one type of small cell lung cancer This step has created a wave of disappointment among its investors.

What do the analysts say about ABBV? Per Finstead Research, ABBV’s average price target is almost $128.


The valuation of ABBV stock is relatively low compared to its peers. Only GILDPFE and BIIB are valued below ABBV based on the forward P/E ratio.


If you're a trader contemplating buying ABBV, there may be a point when the stock will bounce back. 

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


Top 6 Biotech Stocks For Traders

Carla Olson | 1:48 am ET, 08 Jan 2018

biotech

Biotech stocks are a risky business—certainly not suitable for retirement investing.  If you’re up for some speculative biotech trades, we are presenting the top 6 among our freshest picks of biotech stocks for the coming 12 months. 

Incyte (INCY)

Now is a good entry point for this drugs development and sales firm. Stocks recently hit a 52-week low. The pipeline of products includes profitable Jakafi for treating bone marrow disorder. 

Alexion Pharmaceuticals (ALXN)

A global biotech firm with a strong balance sheet and new drugs in development. Specializes in life-changing therapies for patients affected by rare diseases. 

Celgene Corporation (CELG)

A stable company showing steady growth in revenue in recent quarters in this high-risk sector. Celgene specializes in cancer and inflammatory diseases, developing its own drugs and collaborating with other large drug producers. Good investing opportunity thanks to a sharp stock decline of over 30% in October 2017. 

Gilead Sciences, Inc. (GILD)

Gilead is a leader in HIV treatment, with a successful hepatitis C product, and is growing steadily around 30% in the last five years. Revenues and operating profit have both increased over 4 years. 

Enzo Biochem, Inc. (ENZ)

Enzo offers a range of therapies that include cardiovascular and infectious diseases plus diabetes and cancer. Its stocks have been on an upward trend since March 2016, forming several new bases since then. 

Vertex Pharmaceuticals (VRTX)

Vertex focuses on cystic fibrosis treatments, and its growth prospects lie in its pipeline. Analysts are excited about its growth prospects, with predictions way ahead of other biotech firms. Vertex has the potential to grow its earnings by 65% annually in the next few years. 

Over the last year, INCY returned -4.90%. This return is lower than Biotechnology sector (78.04%), Healthcare industry (50.71%), and S&P 500 (20.90%) returns.

Over the last year, ALXN returned -11.93%. This return is lower than Biotechnology sector (78.04%), Healthcare industry (50.71%), and S&P 500 (20.90%) returns.

Over the last year, CELG returned -11.70%. This return is lower than Biotechnology sector (78.04%), Healthcare industry (50.71%), and S&P 500 (20.90%) returns.

Over the last year, GILD returned -2.28%. This return is lower than Biotechnology sector (78.04%), Healthcare industry (50.71%), and S&P 500 (20.90%) returns.

Over the last year, ENZ returned +18.10%. This return is lower than Medical Laboratories & Research sector (22.24%), Healthcare industry (46.89%), and S&P 500 (20.90%) returns.

Over the last year, VRTX returned +96.93%. This return is higher than Biotechnology sector (78.04%), Healthcare industry (50.71%), and S&P 500 (20.90%) returns.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


Gilead Sciences, Inc. (GILD) Buy or Sell Stock Guide

Updated at: 5:06 am ET, 11 Mar 2019

The analysis below may be helpful to you if you have any of the following questions about GILD stock:

  • Is GILD a buy or a sell?
  • Should I sell or hold GILD stock today?
  • Is GILD a good buy / a good investment?
  • What are GILD analyst opinions, recommendations, ratings?

Here are GILD stock buy reasons/signals:

1. Gilead markets several single-tablet regimens for HIV, and the firm's next-generation products with better long-term safety profiles, led by Genvoya, are boosting Gilead's market share.

2. Guidelines that aim to improve diagnosis and treatment rates, and new prophylaxis use, provide strong tailwinds for growth in HIV.

3. With the approval of Sovaldi and Harvoni, Gilead is the market leader in all-oral hepatitis C treatments. None of Gilead's competitors have other proven nucleotide analogs approaching the market, making the $11 billion acquisition of Pharmasset look like a bargain.

4. Gilead is known for its presence in the HCV market because of its blockbuster HCV drugs, Sovaldi and Harvoni. While Sovaldi continues to be a very important product for the company, being mostly used for the treatment of genotypes 2 and 3, Harvoni’s label has been expanded twice in the United States since approval and is now approved for use in a broader range of patient population. Presently, there is immense interest as well as commercial potential in HCV treatments given the size of the market.

5. Gilead has a robust pipeline with several development programs currently underway, ranging from phase I through phase III. The company has quite a few programs targeting non-alcoholic steatohepatitis (NASH) with advanced fibrosis including selonsertib (ASK-1 inhibitor; phase III), GS-9674 (FXR agonist; phase II) and GS-0976 (ACC inhibitor; phase II). We note that NASH is a serious liver disease affecting up to 15 million people in the United States and could lead to more serious conditions like inflammation, hepatocellular injury, progressive fibrosis and cirrhosis.

6. Gilead is looking to boost its portfolio and pipeline through deals and acquisitions. The company is also looking to expand beyond antivirals into other therapeutic areas. In May 2016, the company acquired Nimbus Apollo and its ACC inhibitor program in a deal worth $1.2 billion.

7. Gilead is making efforts to boost shareholders' value. During 2017, the company paid cash dividends of $2.7 billion and repurchased shares for $954 million.

8. GILD stock price ($63.23) is close to the 52-week low ($60.54). Perhaps now is a good time to buy?

9. GILD forward dividend yield is 3.82%, higher than the industry (0.68%) and sector (0.13%) forward dividend yields.

10. GILD forward P/E ratio is 9.26, and it’s low compared to its industry peers’ P/E ratios.

11. GILD Price/Sales ratio is 3.71, and it’s low compared to its industry peers’ P/S ratios.

12. GILD average analyst rating is Buy.

13. GILD average analyst price target ($80.86) is above its current price ($63.23).

Here are GILD stock sell reasons/signals:

1. Gilead's HIV franchise will see the first important patent expirations in 2017 and 2021, and the firm needs to convert patients to newer products like Genvoya to avoid a significant hit to sales.

2. Pricing pressure and reduced willingness to pay for convenience could weigh on Gilead's growth. Atripla will become a formidable generic competitor to Gilead's newer HIV products by 2021, and competing hepatitis C regimens are giving PBMs the ability to negotiate aggressively.

3. HCV patient demand is plummeting, and visibility on long-term demand and pricing is low.

4. Gilead is no stranger to pipeline setbacks. In fact, the company has been suffering a string of pipeline setbacks since the last few years. During 2016, the company terminated the phase II and IIb studies on simtuzumab for the treatment of idiopathic pulmonary fibrosis, NASH and primary sclerosing cholangitis, phase II and II/III studies on GS-5745 for the treatment of Crohn's Disease and ulcerative colitis, phase II studies on GS-4997 for the treatment of pulmonary arterial hypertension and diabetic kidney disease, and phase II study on eleclazine for the treatment of ventricular tachycardia/ventricular fibrillation, after determining that study data showed insufficient evidence of treatment benefit.

5. Gilead’s products face intense competition in the market from both large pharma and biotech companies as well as specialized pharma firms and generic drug companies. Harvoni, Sovaldi and Epclusa, face competition from AbbVie’s Viekira Pak and Viekira XR, Bristol-Myers’ Daklinza and Johnson & Johnson’s Olysio. Competition as well as pricing pressure has intensified further with the launch of Merck’s Zepatier.

6. While the acquisition surely looks positive given the potential in the CAR T space, the deal looks expensive given the price Gilead paid. While the approval of Yescarta is a significant boost for the company, CAR-T therapy is complicated and can sometimes be associated with severe side effects which can limit potential.

7. GILD quarterly revenue growth was -2.60%, lower than the industry and sector average revenue growth (3.63% and 3.10%, respectively).

8. GILD profitability is declining. The YoY profit margin change was -26.70pp.

What are your thoughts on GILD?

If you liked this analysis, check out Buy or Sell Stock Guides for other stocks.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


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