Bristol Myers Squibb (BMY)

(A Top Pick Feb 8/17. Up 20%.) Still his favourite Pharma name. Had a small one-cell lung cancer solution, and the market is starting to get its head around that they are still in the game. We should get results in the 1st half of 2018. Over the next 5-6 years, their pipeline of drugs is so vast and undervalued, that as drugs come through fruition into cash flow and get approval, there are more and more tailwinds. It could be a potential take out candidate.

(Market Call Minute.) This has a lung cancer drug that is starting to face competition. With this, you will have to be either patient or cautious.

They will be quite volatile. He likes it. There is a trial coming out in January of next year. It trades at 19 times forward earnings and a little ahead of peers. He would own it in combination with others to balance out the risk.

(Top Pick Nov 1/16, Up 15%) They had a step back last year on their lung cancer drug. He is still a major holder.

It represents tremendous value for patient investors. Over 3-4 years there is tremendous value in the pipeline of drugs. They have the best franchise. There are activists involved. It could be an M&A target. (Analysts’ target: $58.00).

Around 2016 this stock ran up substantially on the back of an immunotherapy drug. Unfortunately, it did not have the same effect as one of their competitor’s drugs. At this price, it is reasonably attractive, but would suggest you look at Merck (MRK-N) instead.

(A Top Pick June 14/16. Down 21%.) The Pharma group came under pressure last summer, and continues to be under pressure. He prefers the biotech space. (See Top Picks.)

Healthcare names in general have been extremely volatile for a whole variety of reasons. It seems to be a hot button for politicians. Also, Amazon (AMZN-Q), getting into the pharmaceutical distribution business, is a negative. Overall, he thinks the company is really good. It is attractively priced. One of the largest concentrations of their portfolio are the oncology drugs. If you are willing to look out 6 months to a year, you will be happy if you buy it today. On the other hand, if you are looking for something that will be more rewarding in the short run, he would stay away from healthcare.

Most drug stocks sold off on the assumption that Hillary Clinton was going to come in, as well as Trump stating he was going to cut healthcare. He would prefer more of a pure play. Right now, this is a little rich given where we are. On the other hand, this is down significantly so it might be okay. If Trump is successful in his 15% tax credit, capital will flow in and companies like this will run. If you take a pause, you may miss a run.

Not one of the biggest pharmaceuticals, but still a $40-$50 billion company with a lot going on. The company has brought out a drug called immunotherapy. It uses the body’s defence system, props it up and helps fight cancer. They kind of blew their trial by not using it with chemotherapy. He likes this because their new drug has 36 approvals. There is a lot of upside in this company.

Likes healthcare. Ever since Hillary Clinton tweeted on drug costs, the whole space has been under fire and under pressure. Valuation levels on a lot of the stocks are starting to look attractive. He believes in the long-term demographic shift towards healthcare stocks. Doesn’t think you will go wrong owning this. He would prefer Pfizer (PFE-N) which trades at 13X earnings with a 4% dividend yield. Also, feels their pipeline is very undervalued.

Money is going to come back into these drug stocks, but we have to see what happens with Obamacare.

They have a pipeline of drugs, but the clear driver is going to be its immuno oncology platform. When you look through to 2020, that is going to be about 55% of its revenues. They have their combo with Opdivo Oeuvre which is coming out later this year. Don’t be naïve to the risks that are associated here. Roche is coming in 2^nd line lung cancer and are capturing market share. This will trade off of the other companies. He owns all 3.

A big legacy pharmaceutical company that has undergone a bit of a Renaissance in the last 5 years. One of the 2 big pharmas (along with Merck (MRK-N)) that have become leaders in cancer immunotherapy area, a fast growing area. In mid-2016 the stock really dropped because of a negative trial result. He likes this longer-term, but you have to be cautious because they are going through some turbulence. The stock still isn’t cheap. If it got down to around the 52-week low, that would be an area to start looking.

This has an ugly chart, but is still a great company. When the stock got to $70, it was basically pricing in a lot of growth with their Opdivo immuno oncology cancer drug. Missed some trials on about 15% of the market for the drug, and the stock really got whacked. The market has pretty well taken out any earnings of this drug. 85% of the market is still available, so he thinks that over the next 3-4 years, they are still going to be a leader with immuno oncology. You are now paying 16X forward earnings for a company that normally trades in the 20Xs. Dividend yield of 3%. (Analysts’ price target is $55.44.)