Latest Expert Opinions

Signal
Opinion
Expert
WATCH
WATCH
December 3, 2018
A frustrating stock. They have expensive drugs, such as for hepatitis C. They failed to build out their franchise and not making acquisitions, and have only been doing that in the past few years. Their HIV franchise is doing quite well, though. They acquired Kite Pharma which could be a game-changer later. It's trading at 10x earnings. Upcoming catalysts are a liver study in Q1/Q2 could be positive. Maybe. But is GILD a value trap or opportunity? Buy it as its chart improves.
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A frustrating stock. They have expensive drugs, such as for hepatitis C. They failed to build out their franchise and not making acquisitions, and have only been doing that in the past few years. Their HIV franchise is doing quite well, though. They acquired Kite Pharma which could be a game-changer later. It's trading at 10x earnings. Upcoming catalysts are a liver study in Q1/Q2 could be positive. Maybe. But is GILD a value trap or opportunity? Buy it as its chart improves.
BUY
BUY
December 3, 2018
Likes it very much. Thought bought Covidien, a medical device maker, a few years back. They're executing very well, such as their diabetes franchise which boosted their guidance recently to 5.5% growth in 2019. Valuation good at 17.5x vs. peers. Many of their products are essential services which is anothe tailwind.
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Medtronic Inc (MDT-N)
December 3, 2018
Likes it very much. Thought bought Covidien, a medical device maker, a few years back. They're executing very well, such as their diabetes franchise which boosted their guidance recently to 5.5% growth in 2019. Valuation good at 17.5x vs. peers. Many of their products are essential services which is anothe tailwind.
WAIT
WAIT
December 3, 2018
Maybe the CVS acqusition of Aetna is synergistic by putting Aetna facilities besides CVS locations, but will this drive volume within the pharamcy? He's not sure. Trades at 10x earnings. With this purchase, their debt is higher. Wait a couple of quarters to see if the acqusition pans out.
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Maybe the CVS acqusition of Aetna is synergistic by putting Aetna facilities besides CVS locations, but will this drive volume within the pharamcy? He's not sure. Trades at 10x earnings. With this purchase, their debt is higher. Wait a couple of quarters to see if the acqusition pans out.
COMMENT
COMMENT
December 3, 2018
He exited. They distribute drugs, a price x volume business, with retail pharmacy (Rexall) outlets in Canada as well as another chain in Germany. The stock is cheap, but the overall business is in the process of changing as the discussion in the States shifts from high drug prices to rebates. That's why he's on the sidelines of the drug distributors. Also, branded drug prices are rising 6-8%, but generics are falling 8-10% annually--that's begative. He's on the sidelines of this sector. Keep an eye on generic pricing.
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McKesson Corp (MCK-N)
December 3, 2018
He exited. They distribute drugs, a price x volume business, with retail pharmacy (Rexall) outlets in Canada as well as another chain in Germany. The stock is cheap, but the overall business is in the process of changing as the discussion in the States shifts from high drug prices to rebates. That's why he's on the sidelines of the drug distributors. Also, branded drug prices are rising 6-8%, but generics are falling 8-10% annually--that's begative. He's on the sidelines of this sector. Keep an eye on generic pricing.
COMMENT
COMMENT
December 3, 2018
Very frustrating. He likes their long-life assets and consumer health business (consistent cash flows). They have some pipeline. Acqusitions surprised him--in 2016, GSK swapped their oncology assets for vaccine assets of Novartis. Then, they spun out their consumer businesses into a joint venture. It was bizarre they purchased oncology; is it accretive? He thinks they bought it to see where else they can extract value. They paid a hefty premium to buy Tessaro. GSK pays a large dividend and has a strong balance sheet, so good income.
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Very frustrating. He likes their long-life assets and consumer health business (consistent cash flows). They have some pipeline. Acqusitions surprised him--in 2016, GSK swapped their oncology assets for vaccine assets of Novartis. Then, they spun out their consumer businesses into a joint venture. It was bizarre they purchased oncology; is it accretive? He thinks they bought it to see where else they can extract value. They paid a hefty premium to buy Tessaro. GSK pays a large dividend and has a strong balance sheet, so good income.
PAST TOP PICK
PAST TOP PICK
December 3, 2018
(A Top Pick Jul 05/18, Up 24%) Across 14 states, they're a managed-care company including health insurance. They benefit from the privatization of Medicare. Every quarter they beat. They've had a great run. He uses covered calls on this. A strong hold.
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Anthem Inc (ANTM-N)
December 3, 2018
(A Top Pick Jul 05/18, Up 24%) Across 14 states, they're a managed-care company including health insurance. They benefit from the privatization of Medicare. Every quarter they beat. They've had a great run. He uses covered calls on this. A strong hold.
PAST TOP PICK
PAST TOP PICK
December 3, 2018
(A Top Pick Jul 05/18, Up 10%) He held onto this over the summer, despite expecting autumnal volatility. It's a diversified biotech and big in bio-similars, so AMGN would benefit from an uptick here. It's reasonably priced.
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Amgen Inc. (AMGN-Q)
December 3, 2018
(A Top Pick Jul 05/18, Up 10%) He held onto this over the summer, despite expecting autumnal volatility. It's a diversified biotech and big in bio-similars, so AMGN would benefit from an uptick here. It's reasonably priced.