Gilead made a strong start to 2014, with both revenues as well as
earnings beating expectations by huge margins in the first quarter
of the year. The company's first-quarter adjusted earnings of $1.44
per share blew past the Zacks Consensus Estimate of $0.75. The
massive earnings outperformance was attributable to the exceptional
performance of Sovaldi in its first full quarter in the market.
Sovaldi's strong sales ($2.27 billion) helped Gilead record total
revenues of $5 billion, easily surpassing the Zacks Consensus
Estimate. We expect Sovaldi sales to continue growing throughout
2014. We are also positive on the potential offered by oncology
candidate idelalisib. We are optimistic about Gilead's growth
prospects and are upgrading it to Outperform.
Gilead Sciences, Inc., a biopharmaceutical company, focuses on
the discovery, development and commercialization of drugs for
treating HIV/AIDS, liver diseases such as hepatitis B virus (HBV)
and hepatitis C virus (HCV), respiratory, oncology /inflammation
and cardiovascular related diseases. Lead products at Gilead
include HCV therapy Sovaldi apart from Truvada, Viread, Atripla,
Complera, Stribild and Emtriva for the treatment of HIV in adults.
Apart from the HIV franchise, Gilead's other products include
AmBisome (treatment of fungal infection) and Letairis (treatment of
pulmonary arterial hypertension). Gilead's portfolio also includes
Cayston (improvement of respiratory symptoms in patients suffering
from cystic fibrosis with pseudomonas aeruginosa) and Ranexa
The U.S. approval of HCV therapy Sovaldi in Dec 2013 is a big
positive for Gilead as the drug offers significant commercial
potential. European approval of the drug came in Jan 2014. The drug
is off to a strong start.
Gilead operates in North America, South America, Europe and
Asia-Pacific. Total revenues at Gilead came in at $11.20 billion in
2013, up 15%. Strong sales of the company's antiviral products
contributed to the increase. In 2013, total antiviral products
accounted for 86.5% of product sales. Total product sales climbed
15% to $10.80 billion in 2013. The company, founded in 1987, is
headquartered in Foster City, Calif.
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