Amgen Inc. (NASDAQ: AMGN) is expected to be the first such biotech-dividend stock out there. It has not yet happened. Our indications from recent conferences is that Amgen is closer to considering a dividend but is still not ready to pull the trigger. That is too bad considering buybacks and a stock on the road to nowhere. Amgen in many cases now acts and feels like just a Big Pharma player with low growth. Without a dividend it is not even that.
Gilead Sciences Inc. (NASDAQ: GILD) is refraining from declaring a dividend and this week’s healthcare conference did not bring us any closer to believing that this biotech would trump Amgen by declaring a dividend. Gilead is likely to continue looking for growth opportunities via acquisitions.
Amgen states on its investor relations website: Amgen does not pay a dividend on stock, and does not foresee doing so in the immediate future. Accordingly, Amgen does not offer a DRIP (Dividend Reinvestment Program).
Gilead states on its investor relations website: Currently the company does not offer a dividend or stock reinvestment plan.
Gilead has a $31.3 billion market cap, has over $2 billion in cash and short-term investments, an additional $3.2 billion in ‘long-term’ investments, and only carries about $2.8 billion in long-term debt (as of December 31, 2010).
Amgen has a market cap north of $48 billion, had about $17 billion between cash and short-term investments at year-end.
No solid commitment here for dividend investors. We’ll look out to Amgen’s April 21 “Business Review Meeting” for more information on a dividend.
JON C. OGG
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