Gilead Sciences: 7 Different Insiders Have Sold Shares This Month

Jun.26.14 | About: Gilead Sciences, (GILD)

Summary

7 insiders sold Gilead stock within one month.

The stock was not purchased by any insiders in the month of intensive selling.

2 of these 7 insiders decreased their holdings by more than 10%.

Gilead Sciences (NASDAQ:GILD) discovers, develops, and commercializes human therapeutics for the treatment of life threatening diseases in North America, Europe, and Asia.

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Insider selling during the last 30 days

Here is a table of Gilead's insider activity during the last 30 days.

Name Title Trade Date Shares Sold Option Exercise & Sale Rule 10b5-1 Current Ownership Decrease In Ownership
John Cogan Director June 23 5,000 Yes Yes 42,405
shares + 334,223 options
1.3%
Norbert Bischofberger CSO June 16 90,000 Yes Yes 2,284,383
shares + 1,178,621
options
2.5%
Paul Carter EVP June 9 16,728 Yes Yes 30,705
shares + 57,720 options
15.9%
Robin Washington CFO June 4 6,426 No Yes 57,174
shares + 22,373 options
7.5%
Gregg Alton EVP June 2 33,000 Yes & No Yes 128,694
shares + 34,367
options
16.8%
Richard Whitley Director June 2 5,000 Yes Yes 15,641
shares + 128,723 options
3.3%
John Martin CEO June 2 140,625 Yes Yes 4,429,387
shares + 7,033,671
options
1.2%
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There have been 296,779 shares sold by insiders during the last 30 days. All these shares were sold pursuant to a Rule 10b5-1 plan. More details about the Rule 10b5-1 trading plan can be found from this link.

Insider selling by calendar month

Here is a table of Gilead's insider activity by calendar month.

Month Insider selling / shares Insider buying / shares
June 2014 296,779 0
May 2014 335,953 0
April 2014 270,353 0
March 2014 294,353 0
February 2014 454,989 0
January 2014 599,225 0
December 2013 477,242 0
November 2013 1,676,793 0
October 2013 477,242 0
September 2013 537,842 0
August 2013 570,962 0
July 2013 713,842 0
June 2013 422,242 0
May 2013 312,242 0
April 2013 326,210 0
March 2013 416,346 0
February 2013 312,242 10,000
January 2013 267,671 0
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There have been 8,762,528 shares sold and there have been 10,000 shares purchased by insiders since January 2013.

Financials

Gilead reported the first-quarter financial results on April 22 with the following highlights:

Revenue $5.0 billion
Net income $2.2 billion
Cash $6.4 billion
Debt $9.8 billion
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The seven insiders sold their shares after these results.

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(Source: Earnings presentation)

Outlook

Gilead's guidance for the full-year 2014 is as follows:

Net product sales $11,300 - $11,500 million
Non-GAAP product gross margin 75%-77%
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(Source: Earnings presentation)

Upcoming milestones

Gilead has the following anticipated milestones in 2014.

HIV

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(Source: Earnings presentation)

Liver Disease

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(Source: Earnings presentation)

Oncology/Inflammation & Cardiovascular

Click to enlarge(Source: Earnings presentation)

Competition

Gilead's competitors include GlaxoSmithKline (NYSE:GSK), Pfizer (NYSE:PFE), and Roche (OTCQX:RHHBY). Here is a table comparing these companies.

Company GILD GSK PFE RHHBY
Market Cap: 125.62B 128.58B 190.09B 249.75B
Employees: 6,100 99,451 77,700 85,080
Qtrly Rev Growth (yoy): 0.98 -0.13 -0.09 0.01
Revenue: 13.67B 43.69B 50.53B 54.37B
Gross Margin: 0.78 0.70 0.82 0.75
EBITDA: 7.05B 14.00B 22.38B 20.91B
Operating Margin: 0.48 0.27 0.33 0.34
Net Income: 4.58B 8.76B 10.99B 12.49B
EPS: 2.70 3.52 3.22 1.80
P/E: 30.30 15.18 9.25 20.46
PEG (5 yr expected): 0.46 1.85 4.34 2.95
P/S: 9.08 2.96 3.70 4.60
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Gilead has the highest P/S ratio among these four companies.

Conclusion

There have been seven different insiders selling Gilead and there have not been any insiders buying Gilead during the last 30 days. Two of these seven insiders decreased their holdings by more than 10%. Gilead has an insider ownership of 0.84%.

Before going short Gilead, I would like to get a bearish confirmation from the Point & Figure chart. The two main reasons for the proposed short entry are a relatively high P/S ratio, and the intensive insider-selling activity.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

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