Amgen Inc. (AMGN)

(A Top Pick Oct 30/14. Up 0.64%.) A great company and he still likes it. Volatile, so you have to have a bit of a stomach going forward. Have some great things in the pipeline and their present drugs are very good.

The healthcare sector in general is a good area to be in. He likes the strong cash flow metrics and the balance sheet. They have a good drug pipeline. Prefers Biogen (BIIB-Q) and Celgene (CELG-Q), which you may want to have a peek at.

They are massive biotechs. It has a dividend yield. They are focused on cutting costs. They have great products in the pipeline. You aren’t taking typical biotech risk.

Biotech Index has had a huge run. It is an area of incredible innovation that is taking place. This company is growing very rapidly. They deal in drugs that people are going to spend a lot of money for repeatedly. Trading at huge valuations and there is substantial competition. There is a battle taking place between drug costs and health insurance costs in the US. About 3% of the drugs that are being prescribed account for about 80% of the bill. This means there is a very big concentration of risk. Thinks there is going to be a battle between the insurers and the drug companies, and that it is not far away. Be careful as there is a lot of volatility.

Trading at about 16X earnings. Have great drugs in the kidney area and in cancer. Also, thinks there is a cholesterol drug coming out. Management is really interested in increasing margins, cutting costs, increasing dividends and paying back money to shareholders. Dividend yield of 1.89%.

Great company with a dividend yield of 2.07%. Trading at about 14 or 15 times earnings. Have real great products in the kidney area and cancer research. Also, have some great products coming through the pipeline. Feels they are committed to keeping cost structure down, increasing operating margins, increasing dividends and doing share buybacks. Also, have a good cholesterol drug that is coming out now.

A biotechnology company, but looks more like a pharmaceutical company in his view. Trading at 18X earnings. Have some great products in their pipeline. Feels the stock is worth probably in the $200 range. Yield of 1.51%.

25% of drug consumption and will increase to 50% in the next few years. Return 60% of profit distributed to shareholders.

The healthcare space is leading the market. This is a little more aggressive. XBI, an ETF is an alternative. Consolidation is taking place in the Pharma space. AMGN should continue to return cash to shareholders. It is probably not a buyout target.

(A Top Pick July 10/12. Up 39.99%.) Nothing wrong with this company and he would buy it today.

In health care space, he owns Eli Lilly and Pfizer, more of the defensive type of names. This company would be more in the bio Pharma type of space with a little bit more growth. Trading around 14X. Decent valuation. Prefers Celgene (CELG-Q) a little bit more which has a much better growth rate.

Likes Pharma. ETFs have been strong performers. Have the right kind of characteristics. 2.2% dividend yield. Looks good from a risk-adjusted stand-point.