Gilead Sciences Inc. (GILD)

Health care has been about the best performing sector. An interesting company because they have lots of products and there are lots of catalysts coming. This is where money is going during the rally.

He has concerns. This company is often recommended, but he feels the stock price has been largely built on Solvaldi, a hepatitis C drug, which has been incredibly successful, but they have built their financial fortune on the fact that they sell it for $1000 a day in the US. There are competing products coming to market. One is through AbbVie (ABBV-N) and one through Merck (MRK-N). He fears the competitive landscape will change and, although Solvaldi will continue to be an effective drug, it will not get anywhere near the $1000 a day, which will be a big financial headache for the company. If you own, he would recommend that you take profits.

Loves this company and thinks it is going a lot higher. A fantastic story in so many ways. A great stock and is generating a ton of shareholder wealth for owners. It is solving a lot of big health problems in the world. This has been the HIV drug leader globally for many years. Continues to produce better medicine in the HIV category. Launched a new revolutionary hepatitis drug called Solvaldi in January, and it looks like it is going to be the most successful 1^st year launch of a drug in history. Over $10 billion in sales over 1 drug is pretty rare. They have followed that up by a 2^nd hepatitis drug in October, and between the 2, the company is growing like a weed. While the stock has done well, it has not caught up with the fundamentals. Stock is trading at 10X next year’s earnings and generates a ton of free cash flow. They are buying back stock.

This is his top healthcare/biotech name in his portfolios. This is one that you want to continue owning. Fairly cheap in terms of valuation. Trading at 13X PE with probably a 25% long-term growth rate.

Not a dividend paying health care company so he can’t hold it. From a PE basis it looks rich bit the sheer strength of the HEP-C drug is driving the growth. No one is close to them. It is in his growth portfolio.

To him, this stock is a little scary. It has a couple of attributes that really cause him to think. The biggest is that their main drug is incredibly expensive. He would want some security that the high price would have some staying power. There could be competition coming from Abbvie (ABBV-N).

A highly recommended company, a fantastic company. He would prefer the IBB-O ETF. It’s a sector that can be hard to understand and the FDA could reject something so he prefers a basket.

Switching over from their main hepatitis C drug to another one. Sales of the older drug were a little bit disappointing. Earnings were down about $.08 a share, versus consensus, but still up tremendously over last year. Stock is very, very cheap on an earnings basis, trading at just under 11X earnings. The new drug is priced a little more attractively. Drug revenues were up 8% year-over-year, not including the old Hep C drug.

(Switch from Apple (AAPL-Q)?) He would buy them both. Apple is his biggest position, but Gilead is his 2nd biggest. It would be like trading one child for another. Apple still has lots of room to go, but there are rumblings about how Apple Pay is working, and that is the next huge business for them.

Believes this company is reporting tonight. They have the hepatitis C drug, followed by a newer version. The 2nd version is selling like crazy within 95%-99% success rate. Making $25 billion in revenue. Very strong name. This is one that you should pick at. Maybe 1% today, watch the earnings tonight, and then do the other half tomorrow.

Their claim to fame is their hepatitis drug. This is a procedure that received a lot of controversy because of the costs. However, it does work better than anything else out there. He is pretty positive on this one, but is more disposed to equipment side of things versus pharmaceuticals. If you had to own one, this would be a good one. They will be generating a ton of cash flow with this new drug.

He is not unhappy not having benefited from the gain. It would have been in a tremendous amount of risk. This stock is growing on one specific drug and that is a risk. Two other competitors are about to introduce the drugs at a much lower price.

(Market Call Minute) Likes the sector. Great HIV drug, Hep-C drug. Prefers an ETF.

Trading at reasonable valuations. The drug they have is a big deal and it works. They also have some good drugs in the pipeline. It will be volatile and you have to worry that somebody else will come up with a cheaper solution.

Biotechs have been a great performer this summer. The period of seasonal strength for biotechs is from April all the way through to the end of September. This had a phenomenal run through that period. However, the period of seasonal strength is coming to an end and there has been some weakness in these momentum names. This is the time to take your profits.