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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.

(click to enlarge)

Insider selling during the last 30 days

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

NameTitleTrade DateShares SoldOption Exercise & SaleRule 10b5-1Current OwnershipDecrease In Ownership
John CoganDirectorJune 235,000YesYes42,405
shares + 334,223 options
1.3%
Norbert BischofbergerCSOJune 1690,000YesYes2,284,383
shares + 1,178,621
options
2.5%
Paul CarterEVPJune 916,728YesYes30,705
shares + 57,720 options
15.9%
Robin WashingtonCFOJune 46,426NoYes57,174
shares + 22,373 options
7.5%
Gregg AltonEVPJune 233,000Yes & NoYes128,694
shares + 34,367
options
16.8%
Richard WhitleyDirectorJune 25,000YesYes15,641
shares + 128,723 options
3.3%
John MartinCEOJune 2140,625YesYes4,429,387
shares + 7,033,671
options
1.2%

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.

MonthInsider selling / sharesInsider buying / shares
June 2014296,7790
May 2014335,9530
April 2014270,3530
March 2014294,3530
February 2014454,9890
January 2014599,2250
December 2013477,2420
November 20131,676,7930
October 2013477,2420
September 2013537,8420
August 2013570,9620
July 2013713,8420
June 2013422,2420
May 2013312,2420
April 2013326,2100
March 2013416,3460
February 2013312,24210,000
January 2013267,6710

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

The seven insiders sold their shares after these results.

(click to enlarge)

(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 margin75%-77%

(click to enlarge)

(Source: Earnings presentation)

Upcoming milestones

Gilead has the following anticipated milestones in 2014.

HIV

(click to enlarge)

(Source: Earnings presentation)

Liver Disease

(click to enlarge)

(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.

CompanyGILDGSKPFERHHBY
Market Cap:125.62B128.58B190.09B249.75B
Employees:6,10099,45177,70085,080
Qtrly Rev Growth (yoy):0.98-0.13-0.090.01
Revenue:13.67B43.69B50.53B54.37B
Gross Margin:0.780.700.820.75
EBITDA:7.05B14.00B22.38B20.91B
Operating Margin:0.480.270.330.34
Net Income:4.58B8.76B10.99B12.49B
EPS:2.703.523.221.80
P/E:30.3015.189.2520.46
PEG (5 yr expected):0.461.854.342.95
P/S:9.082.963.704.60

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.

Editor's Note: This article discusses one or more securities that do not trade on a major exchange. Please be aware of the risks associated with these stocks.

Source: Gilead Sciences: 7 Different Insiders Have Sold Shares This Month