Health and Healthcare
Can Gilead Shares Still Really Rise to $150?
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Gilead Sciences Inc. (NASDAQ: GILD) recently saw a sell-off after the company posted less than favorable earnings, but one analyst thinks that investors have spoken too soon. This independent analyst firm sees this sell-off as overlooking multiple growth drivers, and that it focuses too narrowly on the drop in worldwide sales of Harvoni. As a result, Argus has come out and issued the highest price target on Wall Street for this stock.
Argus reiterated a Buy rating with a $150 price target, implying an upside of roughly 70%, blowing away all other estimates. Keep in mind the consensus analyst price target is only about $111, implying an upside of just 26%.
The research firm continues to see an extended period of strong sales for the company’s hepatitis C drugs, given the many patients, both in the United States and overseas, who have not received treatment. The firm also likes Gilead’s newer versions of HIV drugs that preserve bone density and kidney function.
Gilead appears favorably valued at just 7.3 times the Argus 2016 earnings per share estimate, and well below the mean of 16.3 for Argus’s coverage universe of peer stocks.
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