Gilead Sciences (GILD) Should Attract Value and Growth Investors - Barron's

Gilead (Nasdaq: GILD) is trading positive today following recent ASH presentations and could be getting another boost from Barron's mention on Thursday.

Barron's noted that Gilead has the rare combination of being an attractive stock for both value and growth investors. While shares have trended lower and bounced back with segment peers recently, valuation still remains attractive. The FDA approved its Harvoni drug last October and the drug should add $1.4 billion in Q4 sales by itself.

Gilead is going for 10.5 times forward earnings, compared with 17 times for the S&P 500 index. Even meeting Wall Street's low EPS estimate for 2015, that would put the stock at 13.7 times earnings, which is still comparably low.

Gilead has a first-mover advantage in the hepatitis C (HCV) segment and, with segment peers producing less-than-stellar alternatives in the space, the company is poised to remain a leader. The once-a-day Harvoni bolsters that sentiment.

Along with HCV, Gilead also has its $9 billion HIV business. The company recently submitted a new formulation of its tenofovir alafenamide (TAF) HIV drug for FDA approval.

Going against Gilead include the high price of Horvoni, which runs $1,125 per pill, or $95,000 for a three-month treatment. That could draw ire of some policy makers, Barron's commented.

But, Gilead also is generating solid cash and its return on equity of 30 percent is amongst the highest of its peers. The company is also working on successors in the HCV and HIV space to maintain its competitive positions.

Shares of Gilead are up 1.7 percent.

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