| Snowflake Score | |
|---|---|
| Valuation | 3/6 |
| Future Growth | 2/6 |
| Past Performance | 0/6 |
| Financial Health | 3/6 |
| Dividends | 3/6 |
GILD Stock Overview
Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally.
Gilead Sciences, Inc. Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$62.32 |
| 52 Week High | US$74.12 |
| 52 Week Low | US$57.17 |
| Beta | 0.33 |
| 1 Month Change | -2.35% |
| 3 Month Change | -0.032% |
| 1 Year Change | -7.76% |
| 3 Year Change | -0.65% |
| 5 Year Change | -23.98% |
| Change since IPO | 9,748.11% |
Recent News & Updates
Gilead Sciences: Becoming A Cure
Summary Gilead Sciences has seen a solid second quarter, with non-Covid-19 related product sales being relatively strong. The company has been pursing some bolt-on deals in the meantime, nothing which moves the needle in a major way. Appeal remains to be seen, even if higher interest rates create some competition for the juicy dividend. Shares of Gilead Sciences (GILD) have been settling in the low-sixties again after shares saw a bit of momentum in recent weeks, in contrary to the rest of the market. Since the spring, shares have been range bound between $60 and $65 per share as in July I concluded that the situation was improving here. This came after the company started strong in 2022, albeit that it compares to an underwhelming original outlook. The stronger performance looks interesting, but non-pandemic related sales were stronger than expected, and investors rather would like to see strength in the core part of the business. With non-demanding valuations and some "new" drugs showing some potential and traction, the risk-reward seemed pretty decent. Some Background Gilead has gained fame for solving HCV, after a very well-timed, or perhaps lucky $11 billion acquisition of Pharmasset. This created a huge boost to the business and the shares which peaked at over $100 per share in 2015. With HCV being solved, the boom did not last as the drug sales were not recurring for the simple reason that patients were actually cured. A growing HIV business made that Gilead continued to keep total revenues and earnings flattish, but that was all that. In the meantime, Gilead has pursued many and expensive deals, with not the same pay-off as Pharmasset (which is quite an understatement). This includes a $21 billion deal for Immunomedics (through which it got its hands on Trodelvy), a $12 billion deal for Kite Pharma (which involved Yescarta) as well as multi-billion deals for Forty Seven and Galapagos. 2021 did revenues came in at $27 billion, actually marking the second year in a row in which revenues have risen. That is about the good news as Veklury, Gilead's Covid-19 drug, added $5.5 billion in revenues. Adjusted for that contribution, revenues of the core business have been flattish for a couple of years now. HIV sales totaled $16.3 billion in 2021, being the backbone of the business. HCV sales continued to fall (as has been the case for years) with revenues reported just shy of $2 billion. HBV/HDV sales rose 13% to just below a billion, with cell therapy sales up 43% to $487 million. Adjusted earnings were posted at $7.28 per share in 2021, as net debt fell to $20 billion, while cash flow generation has been solid, despite a compelling dividend and continued share buybacks. The 2022 guidance was a bit soft, with sales seen at just $24 billion (including $2 billion in Covid-19 related Veklury sales) as adjusted earnings were seen down to $6.45 per share. Solid 2022 First quarter sales rose 3% to $6.6 billion, but this was driven by Veklury sales which rose 5% to $1.5 billion, with product sales excluding this drug up 2% to $5.0 billion, driven by the growth in the cell therapy business. The $2.12 per share number (adjusted) looked good, yet the company only reiterated the full year guidance while maintaining a $3 per share dividend, for a yield of around 5%. With product sales flattish, deleveraging rapidly taking place and some good news on the corporate front with regard to approvals and test results, the situation looked quite good. While growth was still hard to find it was the 10% earnings yield, stability and 5% dividend yield which looked compelling to me. Of course, we have seen interest rates increase further, which causes some competition for the 5% dividend yield, but Gilead seems to be holding up just nicely here. Early in August, Gilead posted its second quarter results as revenues rose 1 percent to $6.3 billion. The "good" thing is that Veklury fell 46% to $445 million with the pandemic on its retreat, as other product sales rose 7% to $5.7 billion, a very encouraging trend. This was driven by a modest increase in HIV sales, continued decline in HCV sales, but mostly a 68% increase in cell therapy sales to a run rate of around $1.5 billion, and Trodelvy revenues increasing 79% to more than $600 million. GAAP earnings came in at just $0.91 per share following amortization charges and losses on equity holdings (Galapagos) with adjusted earnings reported at $1.58 per share, as net debt continues to come in below $20 billion. The company hiked the full year sales guidance by $700 million to $24.5-$25.0 billion, with the hike being largely attributed to half a billion greater contribution of Veklury (despite a dramatic year-over-year decline in the second quarter) and $200 million in additional revenue growth of the core operations. In response, the adjusted earnings per share guidance has been hiked to a midpoint of $6.55 per share.
A Dive Into Gilead Sciences' New HIV Medication
Summary We look at an overview of Gilead's HIV medication. Gilead currently pays a 4.52% dividend. The health care sector is a good defensive sector for a recession. Introduction I give a hold rating to Gilead Sciences (GILD) because the company sits in an excellent sector for recessions due to its lack of a cyclical nature and because Lenacapavir looks likely to be approved. However, given its poor performance over the last five years, I don't feel confident in Gilead's ability to outperform the sector. Gilead Sciences is a biotechnology company headquartered in Foster City, California, founded in 1987. Currently, the company's market cap is $82.05 Billion. The company has an EPS of 3.27 on a share price of $64.12, which gives the company a 19.62 PE, which is on the higher side for a biotech company. This is likely because the market is somewhat pricing in Lenacapavir's approval and future revenue. Gilead is paying out an impressive 4.52% dividend. In addition to the dividend, the company returned capital to shareholders with $72 Million in share repurchases. For Q2 2022, the company had $6.1 Billion in sales earning the company $2 Billion in Non-GAAP Net Income. Historical Performance Gilead has underperformed other pharmaceutical companies over the last ten years. The company rocketed from the low $30s in 2012 to over $170 in 2015. However, ever since then, the company has been on a downward trend. Interestingly enough, 2015 was when the company started issuing its dividend, which has grown consistently since its initial issuance. Another reason for the poor performance is the lack of a Covid-19 bump from an incredibly lucrative treatment in which many other pharmaceutical companies of equal or bigger size had some stake. If Gilead had a similar bump, it would have been one of the top-performing pharmaceutical stocks over this period. Instead, it just had normal operating growth. Despite this downward trend, the company is still up 96% over the past ten years. Data by YChartsData by YCharts What is Lenacapavir? Generated Lenacapavir is an HIV/AIDS medication sold under the brand name Sunlenca and developed by Gilead Sciences. The medication can either be taken by mouth or by subcutaneous injection. The drug is being researched for treating patients with multidrug-resistant HIV and used for preventive medicine with a twice-yearly injection for pre-exposure prophylaxis. Drugs.com wrote, "While most antivirals act on just one stage of viral replication, Lenacapavir is designed to inhibit HIV-1 at multiple stages of its lifecycle and has no known cross-resistance to other existing drug classes. If approved, Lenacapavir would be the only HIV-1 treatment option administered twice-yearly." Looking at the clinical data, a recent report on Lenacapavir commented: Lenacapavir is a first-in-class capsid inhibitor and has no known cross-resistance to other existing drug classes... This patient population, with highly resistant HIV infection, represents a significant unmet medical need. Throughout the course of the CAPELLA study, 83% (30 of 36) participants receiving lenacapavir in conjunction with an optimized background regimen achieved an undetectable viral load (<50 copies/mL) at week 52. The participants averaged a CD4 count of 83 cells/µL. For further reading on the clinical results. Approval In Europe On June 23rd, 2022, the Committee for Medicinal Products for Human Use ((CHMP)) of the European Medicines Agency ((EMA)) adopted a positive opinion, recommending the granting of a marketing authorization for the medicinal product Sunlenca, intended for the treatment of adults with multidrug‑resistant human immunodeficiency virus type 1 (HIV‑1) infection. In typical fashion, subsequently, Lenacapavir was approved for medical use in the European Union in August 2022. Clinical Halt Gilead is still waiting for the US Food and Drug Administration (FDA) to make a regulatory decision after Lenacapavir's approval was delayed due to manufacturing issues. The issue centered not around the drug's clinical data but its storage method. Lenacapavir had been stored in borosilicate vials, and due to vial compatibility problems, the FDA issued a clinical halt. Gilead has since addressed the issue and believes they are good to go. Gilead plans to store injectable Lenacapavir in aluminosilicate glass now. After resolving this issue, Gilead resubmitted their NDA for Lenacapavir in July, which the FDA accepted and gave a PDUFA date of December 27th, 2022. Potential Earnings Considering that the drug is already approved in the EU and the clinical halt was over a manufacturing issue unrelated to the clinical data, I believe that Lenacapavir will be approved. Upon approval: Lenacapavir revenues are estimated to reach $1.08bn in 2027, according to GlobalData consensus forecasts. Gilead is looking at Lenacapavir combined with a broad range of agents to address the needs of an effective HIV treatment regimen, said Gilead Sciences vice president of HIV clinical research Dr. Jared Baeten.
Shareholder Returns
| GILD | US Biotechs | US Market | |
|---|---|---|---|
| 7D | -0.03% | 0.4% | -2.5% |
| 1Y | -7.8% | -25.6% | -23.2% |
Return vs Industry: GILD exceeded the US Biotechs industry which returned -25.6% over the past year.
Return vs Market: GILD exceeded the US Market which returned -23.2% over the past year.
Price Volatility
| GILD volatility | |
|---|---|
| GILD Average Weekly Movement | 3.6% |
| Biotechs Industry Average Movement | 11.1% |
| Market Average Movement | 6.8% |
| 10% most volatile stocks in US Market | 15.5% |
| 10% least volatile stocks in US Market | 2.8% |
Stable Share Price: GILD is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: GILD's weekly volatility (4%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1987 | 14,400 | Dan O'Day | https://www.gilead.com |
Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally. The company provides Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, and Atripla products for the treatment of HIV/AIDS; Veklury, an injection for intravenous use, for the treatment of coronavirus disease 2019; and Epclusa, Harvoni, Vosevi, Vemlidy, and Viread for the treatment of liver diseases. It also offers Yescarta, Tecartus, Trodelvy, and Zydelig products for the treatment of hematology, oncology, and cell therapy patients.
Gilead Sciences, Inc. Fundamentals Summary
| GILD fundamental statistics | |
|---|---|
| Market Cap | US$78.11b |
| Earnings (TTM) | US$4.14b |
| Revenue (TTM) | US$27.52b |
18.9x
P/E Ratio2.8x
P/S RatioIs GILD overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| GILD income statement (TTM) | |
|---|---|
| Revenue | US$27.52b |
| Cost of Revenue | US$5.64b |
| Gross Profit | US$21.87b |
| Other Expenses | US$17.74b |
| Earnings | US$4.14b |
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
n/a
| Earnings per share (EPS) | 3.30 |
| Gross Margin | 79.50% |
| Net Profit Margin | 15.04% |
| Debt/Equity Ratio | 129.7% |
How did GILD perform over the long term?
See historical performance and comparison