Gilead Sciences (GILD) AI Stock Analysis

• Market Cap: $131.21B
• Dividend Yield: 2.94%
• Average Volume (3M): 10.33M
• Price to Earnings (P/E): 275.2
• Beta (1Y): 0.46
• Revenue Growth: 6.16%
• EPS Growth: -91.54%
• Country: US
• Employees: 17,600
• Sector: Healthcare
• Sector Strength: 74
• Industry: Drug Manufacturers - General
• EPS (TTM): 0.37
• Shares Outstanding: 1,246,634,500
• 10 Day Avg. Volume: 9,263,559
• 30 Day Avg. Volume: 10,329,758
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.64
• Price to Cash Flow (P/CF): 11.20
• P/FCF Ratio: 11.20
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $115.28
• Price Target Upside: 13.69% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23

Gilead Sciences exhibits strong financial fundamentals, with robust cash flow and a significantly de-leveraged balance sheet. Despite a decline in net profit margins, the earnings call indicates potential growth in key therapeutic areas. Technical analysis suggests a bullish trend, though valuation signals might deter value-focused investors. Overall, Gilead is well-positioned for future growth, albeit with some challenges to navigate.

Positive Factors

Product Launch

Lenacapavir is well positioned for a strong launch in PrEP and is expected to generate significant sales growth, with peak sales potentially reaching over $4 billion.

Stock Recommendation

Analysts maintain a positive outlook on Gilead Sciences, reiterating a Buy rating with a price target of $126.

Strategic Positioning

The company's oncology portfolio is seen as an important growth driver, with the CART franchise gaining scale and Trodelvy expanding into new indications.

Negative Factors

Funding Uncertainty

The uncertainty surrounding potential funding cuts and more restrictive formularies for Medicaid necessitates careful monitoring of the situation.

Policy and Budget Cuts

Proposed Medicaid cuts could significantly impact Gilead Sciences' earnings since Medicaid accounts for a substantial portion of the company's HIV revenues.

Revenue Risks

The underlying HIV business is expected to face a sequential decline in revenues due to seasonal inventory dynamics and IRA headwinds.

Gilead Sciences Business Overview & Revenue Model

Company Description

Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally. The company provides Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, and Atripla products for the treatment of HIV/AIDS; Veklury, an injection for intravenous use, for the treatment of coronavirus disease 2019; and Epclusa, Harvoni, Vosevi, Vemlidy, and Viread for the treatment of liver diseases. It also offers Yescarta, Tecartus, Trodelvy, and Zydelig products for the treatment of hematology, oncology, and cell therapy patients. In addition, the company provides Letairis, an oral formulation for the treatment of pulmonary arterial hypertension; Ranexa, an oral formulation for the treatment of chronic angina; and AmBisome, a liposomal formulation for the treatment of serious invasive fungal infections. Gilead Sciences, Inc. has collaboration agreements with Arcus Biosciences, Inc.; Pionyr Immunotherapeutics Inc.; Tizona Therapeutics, Inc.; Tango Therapeutics, Inc.; Jounce Therapeutics, Inc.; Galapagos NV; Janssen Sciences Ireland Unlimited Company; Japan Tobacco, Inc.; Gadeta B.V.; Bristol-Myers Squibb Company; Dragonfly Therapeutics, Inc.; and Merck & Co, Inc. The company was incorporated in 1987 and is headquartered in Foster City, California.

How the Company Makes Money

Gilead Sciences generates revenue primarily through the sale of its pharmaceutical products across various therapeutic areas. The company's key revenue streams include antiviral medications for HIV/AIDS, liver diseases, and inflammatory diseases. Significant revenue is derived from its flagship HIV products like Biktarvy and Genvoya. Additionally, Gilead engages in strategic partnerships and collaborations with other pharmaceutical companies to enhance its research and development efforts, which can include co-development and co-commercialization agreements. Licensing agreements and royalties from collaborations also contribute to its earnings. The company's financial performance is influenced by factors such as drug pricing, patent protections, regulatory approvals, and market demand for its products.

Gilead Sciences Financial Statement Overview

Summary

Gilead Sciences demonstrates strong financial health with significant improvements in cash management and debt reduction. While revenue growth and gross margins are positive, the decline in net profitability is a concern. The balance sheet is markedly de-leveraged, and cash flows are strong, providing a solid foundation for future investments and strategic initiatives. Continued focus on profitability will be essential to sustain long-term growth.

Income Statement

Gilead Sciences shows a stable revenue base with a moderate growth trajectory, evidenced by a 6% revenue growth in the TTM period. Gross profit margin is healthy at 57.7%, but the net profit margin has decreased significantly to 1.7%, indicating pressure on profitability. EBIT and EBITDA margins stand at 28.9% and 13.1% respectively, showing operational efficiency but a decline in EBITDA suggests rising expenses or other financial pressures.

Balance Sheet

The balance sheet shows remarkable improvement, with total debt reduced to zero, enhancing financial stability. The equity ratio cannot be calculated due to zero stockholders' equity, which could indicate restructuring or financial adjustments. The debt-to-equity reduction is a significant strength, enhancing risk resilience.

Cash Flow

Cash flow analysis reveals robust free cash flow generation with a 40.8% growth in TTM. The operating cash flow to net income ratio is notably strong, indicating effective cash management. The company's ability to generate free cash flow consistently strengthens its capacity to fund operations and investments without relying on debt.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
28.75B	27.12B	27.28B	27.30B	24.69B
	Gross Profit
22.50B	20.62B	21.62B	20.70B	20.12B
	EBIT
1.66B	7.61B	7.33B	7.41B	7.03B
	EBITDA
1.66B	10.50B	8.85B	11.33B	4.13B
	Net Income Common Stockholders
480.00M	5.67B	4.59B	6.22B	89.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.57B	7.26B	7.63B	7.83B	7.91B
	Total Assets
58.99B	62.13B	63.17B	67.95B	68.41B
	Total Debt
3.11B	24.99B	25.23B	26.70B	31.40B
	Net Debt
-6.88B	18.90B	19.82B	21.36B	25.41B
	Total Liabilities
39.75B	39.38B	41.96B	46.89B	50.19B
	Stockholders Equity
19.33B	22.83B	21.21B	21.06B	18.22B
Cash Flow		Free Cash Flow
10.30B	7.42B	8.34B	10.80B	7.52B
	Operating Cash Flow
10.83B	8.01B	9.07B	11.38B	8.17B
	Investing Cash Flow
-3.45B	-2.27B	-2.47B	-3.13B	-14.62B
	Financing Cash Flow
-3.43B	-5.13B	-6.47B	-8.88B	770.00M

Gilead Sciences Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 101.40
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GILD, the sentiment is Negative. The current price of 101.4 is below the 20-day moving average (MA) of 108.57, below the 50-day MA of 107.38, and above the 200-day MA of 88.71, indicating a neutral trend. The MACD of 1.02 indicates Positive momentum. The RSI at 56.51 is Neutral, neither overbought nor oversold. The STOCH value of 89.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GILD.

Gilead Sciences Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNY	79 Outperform	$120.19B	21.31	7.34%	2.89%	-4.57%	2.96%
GILD	75 Outperform	$131.21B	275.16	2.28%	2.94%	6.16%	-91.54%
AMGN	75 Outperform	$156.37B	38.50	67.55%	3.14%	18.64%	-39.39%
GSK	69 Neutral	$65.80B	21.36	19.11%	4.44%	6.28%	-47.11%
PFE	68 Neutral	$127.55B	15.96	9.05%	7.51%	8.77%	272.80%
BMY	60 Neutral	$109.35B	―	-39.10%	4.50%	7.32%	-214.24%
Sector *	48 Neutral	$6.36B	1.28	-45.04%	2.64%	19.24%	1.69%