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Alexander J. Poulos  

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  • Gilead Sciences' Recent Trading Pattern Is Much To Do About Nothing [View article]
    622,

    Easier said then done. State budgets are stretched as is, I can't foresee a situation where GILD is effectively compel them to treat earlier. The only way would be if they had clinical data showing a discernible data proving earlier treatment is far more cost effective. Currently the data is not available, hence the situation we have before us. Watch GILD revenue and earnings will grow quite nicely from here, lets see what treasures the clinical pipeline holds. Thanks for reading and commenting.
    Jan 16, 2015. 08:46 AM | Likes Like |Link to Comment
  • Gilead Sciences' Recent Trading Pattern Is Much To Do About Nothing [View article]
    Thomas,

    An attempt by the Indian patent office to circumvent GILD valid worldwide patent for the benefit of their homegrown generic companies. I would term this as "rent" seeking behavior that will be litigated further. Sales from India and the third world were never factored into GILD rev growth as these countries simply could not afford to pay list price for the treatment. Thanks for reading and commenting.
    Jan 16, 2015. 08:43 AM | 2 Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    Ameno,

    A share repurchase would be optimal yet unpopular. Management needs to restore the traditional income component so expect to see some of the excess capital earmarked towards a dividend. Thanks for reading and commenting.
    Jan 15, 2015. 10:59 PM | Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    maybe,

    C is all about patience. Thanks for reading and commenting.
    Jan 15, 2015. 08:56 PM | Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    Jeff,

    The worse case scenario here is the shares continue to languish. I realize the collapse in oil is putting severe pressure on rates yet it is simply unsustainable. I suspect you will see oil bottom out and reverse higher which will allow rates to gently rise. At some point the Fed has indicated it will raise short term rates which will be helpful. C is a game of patience, the gain is there for the taking for those willing to wait it out. Thanks for reading and commenting.
    Jan 15, 2015. 06:05 PM | 1 Like Like |Link to Comment
  • Citigroup Too Cheap To Pass Up [View article]
    Tim,

    I couldn't agree more, the CCAR announcement in March will be pivotal.
    Jan 15, 2015. 04:48 PM | Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    jim,

    My original entry is $46 with an average price of $48.5. C generated a ton of excess capital that will be returned to share holders at some point (March). By buying below BV and holding a patient long term shareholder should do quite well. Incidentally, the BV is the metric I use to invest in all financial companies (banks, insurance). The metric has served me well with very successful entries into WFC, ALL, TMK, the only one I am waiting for is C. Thanks for reading and commenting.
    Jan 15, 2015. 04:29 PM | 1 Like Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    Star,

    Check back in March to indeed determine if the company is brain dead. I suspect the patient will be pronounced viable and is on the road towards a full recovery. Thanks for reading and commenting.
    Jan 15, 2015. 04:25 PM | Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    dieuwer,

    Actually the market thinks status quo will prevail which is worse than bankruptcy. In this scenario, the bank will continue to accrue excess capital that is trapped on its balance sheet. The bank due to a "denominator" problem is precluded from generating a meaningful return on equity. At that point C becomes a value trap. I suspect the Fed will allow them to reduce the excess capital trapped on their books in March however there are no guarantees.
    Jan 15, 2015. 02:21 PM | 2 Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    Tony,

    Hopefully we will get a meaningful dividend in March if not expect Corbat to be yanked and replaced, he said as much himself. Thank you for reading and commenting.
    Jan 15, 2015. 02:03 PM | 1 Like Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    Ric500,

    To generate some income I have sold covered calls against the shares a couple of times with a modicum of success. At some pint the value will be recognized, more than likely after March especially if the market stabilizes. Watch WFC, the shares are down over 6% ytd. They are the best run bank if they are trading off the whole sector is under siege.
    Jan 15, 2015. 02:01 PM | 2 Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    dieuwer,

    With c trading meaningfully below TBV it is the equivalent of paying roughly 80 cents for $1. TBV is the value of the shares at liquidation excluding goodwill, lots of pessimism here, the concept of a value trap doesn't apply. Thank you for reading and commenting.
    Jan 15, 2015. 01:58 PM | Likes Like |Link to Comment
  • My Expectations For Citigroup In 2015 [View article]
    all on board,

    That is the inherent beauty of being undervalued, a small change causes a sudden change in perception, leading to a higher valuation. As outlined above, the major catalyst is the CCAR process with results that will be announced in March. The banking sector has sold off quite sharply this month, no surprise here. If they are denied a significant capital return in March expect a new catalyst to emerge, ie the removal of management. The shares are trading at far less then liquidation value, I will patiently wait for the value to be realized. Thank you for reading and commenting.
    Jan 15, 2015. 01:34 PM | 4 Likes Like |Link to Comment
  • Are Housing Stocks Ready To Rock Or Roll Over? [View article]
    Doc,

    Excellent article as usual. Housing as we know is very dependent on interest rates son on the face of its, the low rates offered currently should stimulate demand. I suspect it won't for one of the reasons you briefly alluded to above. I suspect "this time will be different " based on tow distinct factors.

    The first factor is the lack of meaningful wage growth in the Us over the past decade. If a prospective buyer was reasonably confident of say 3-5% annual raises combined with a vibrant job market it would be lolapalooza for housing stocks. Instead we have stagnant wages and contrary to popular belief a relative stagnant job market. These are hardly the conditions that would propel a would be first time buyer to take the plunge and take on a 30 year commitment.

    The second factor plays a bit of the stagnant job market theme that needs to be examined. A house is a comforting piece of mind yet it also essentially "ties" a person to a particular area. With a stagnant job market the need may very well arise where a prospective buyer would have to leave the area on short notice to take on a new job. The housing market is vibrant, this concern diminishes yet now it is in my view a factor that makes most a bit gun shy.

    The third point is the lack of meaningful appreciation in real estate in large parts of the country. Outside of NYC and SF, large metropolitan cities that are simply out of the affordability range of virtually all first time buyers, the rest of the country has seen scant appreciation. In my particular case, my home was purchased in early 2004 at a fair price (needed work). The house was recently appraised for the same amount it was purchased for before renovations were completed! Looking back it would have been more advantageous in my case to have rented in the area. I have no doubt there are countless others out there with similar experiences that they are sharing with the younger first generation home buyers.

    The last point is the traditional amount of new supply needed is far below levels seen over the past 30 years. when I was actively invested in XHB it was based in the theory of mean reversion coming in off a major trough. Luckily for me the play was quite successful yet the theory didn't play out as expected. I suspect the better play is those that supply the field such as SHW an absolute monster of a stock. I came aboard quite late here, yet have now come to realized the power of the company. If we ever see a sizable pullback in the shares count me in.
    Jan 15, 2015. 10:14 AM | Likes Like |Link to Comment
  • Gilead Sciences' Recent Trading Pattern Is Much To Do About Nothing [View article]
    SPA,

    The recently announced deals fail to validate the fear many had that ESRX would set the trend in the industry. ESRX move to exclude Harvoni is now looking more of an outlier than a trend setter.

    As for my revenue projections, 2015 may indeed prove to be a peak year as far as treatment goes yet I remain skeptical. The sheer cost of the treatment will stretch virtually all government payers. A triage system will be set up where those who are deemed the most "ill" will be treated first. Under this scenario, the HCV franchises will exhibit revenue and growth patterns similar to other traditional meds that offer "treatment and management" of a particular disease state.

    I have no doubt competition will remain fierce, there is quiet a large pot of gold to be had here. The key for GILD is to ensure there treatment remains "best in class" which will ensure they retain the lion share of the market. We will have to wait clinical data from MRK candidate to gauge its potential. As of now, my suspicion is ABBV treatment is at more risk that GILD. Assuming MRK treatment is proven to be as effective as ABBV without the use of Ribavirin, usage of ABBV product would fall dramatically. MRK and GILD would then be locked in battle for market supremacy.

    The upside for GILD is the strength of their clinical pipeline. i fully expect to see additional new novel treatments emanate from the lab over the course of the next two years. I am particularly interested in Simtuzumab for the indication of NASH. A breakthrough in NASH would solidify GILD and propel them towards becoming the most valuable pharma company in the world. If you look at the calucaltions in the model, revenue growth slows rather dramatically in 2016 down to 7.5%. The model is quite fluid and will be updated regualrly once material info is disseminated from GILD. Thank you for reading and I appreciate the comment.

    For those interested in the MRK compound, the following link shows phase 2 results.http://bit.ly/1y1t2Bi
    Jan 15, 2015. 09:11 AM | 1 Like Like |Link to Comment
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