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Opinions Gordon Reid
Gilead Sciences Inc.GILDCOMMENTSep 07, 2016
Gordon ReidStock price when the opinion was issued
As of Jun 17, 2026. Market Open.
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It's a biopharma which as a group did very well last year. Compare that to the smaller biotechs which have not done well the past 3 years. This year, biopharma and staples have underperformed. This boasts a high free cash flow yield and has a great product cycle coming.
In past years, biotech was the safe trade, but this year risk is back, so these stocks have fallen out of favour. Also, there are so many drugs in trials now and big pharma needs new product. She's looking at Gilead and Moderna, because they have low PEs and alot of drugs in development. However, the overall sector is risky.
Has long owned this, because it's a value stock and keeps raising its dividend.
Brian Belski
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Has not been a fan of this company. He worries that the market is going to anticipate lower earnings on the back of erosion in the pricing of their drug. It is viewed as a one trick pony. They are building up a cash hoard and are very profitable today. Free cash flow yield is 13%, which is very, very good. The question is, are they going to be able to utilize their cash to advance their company. They have done it before. There is a pretty good possibility that at the current price, there is not a ton of downside left. The upside is that they make a pretty bold move, take their offering, and broaden it and move the multiple up.