Berenberg Starts Gilead Sciences (GILD) at Buy, $112 PT

September 12, 2016 6:15 AM EDT
Get Alerts GILD Hot Sheet
Price: $72.70 +0.94%

Rating Summary:
    24 Buy, 11 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 21 | Down: 36 | New: 11
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Berenberg initiates coverage on Gilead Sciences (NASDAQ: GILD) with a Buy rating and a price target of $112.00.

Analyst Laura Sutcliffe commented, "After a three-year period when revenues tripled, driven by sales of Gilead’s Hepatitis C (HCV) drugs which revolutionised care in this area, earnings are set to flatten. HCV sales have peaked. Faster-than-expected drop-off has fuelled disappointment and a fall in the share price of 22% ytd. We believe that the shares have retreated too far and are now meaningfully undervalued."

She added, "The Hepatitis C business will remain highly cash generative: HCV sales grew from nothing in 2012, to over $19bn last year. This represents peak sales as many of the sickest patients have now been treated, but a large pool remains. We forecast a steeper decline than consensus but still see the HCV franchise bringing in over $10bn in 2019. This part of the business is very profitable with margins over 90% and we think it can generate $49bn of cumulative EBIT between 2016 and 2020."

For an analyst ratings summary and ratings history on Gilead Sciences click here. For more ratings news on Gilead Sciences click here.

Shares of Gilead Sciences closed at $78.05 yesterday.



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