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jstratt

jstratt
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  • Juno up 53% after hours on 10-year Celgene deal [View news story]
    I am just going to make a few points.

    1) CELG is probably getting super shares or shares with long term options added or they would not be paying a $93 price.

    2) CELG is getting a steal by buying into a potential revolutionary product line which compliments their current business

    3) Juno is getting help commercializing their discoveries but probably are no longer a merger candidate. They essentially sold much of their profit potential possibly to lock in current management and prevent a takeover. JUNO may be worth less now, not more?

    4) Very smart move on CELG part. Why pay $7-8 bil for 100% of JUNO when you can buy a piece for $1 bil and lock up a potential piece of $50-$100 billion in franchise jewels, if it works out.

    5) JUNO's technology is validated but they only own probably 70% of it now.

    That is how I see it from the available information.
    Jun 29, 2015. 09:49 PM | Likes Like |Link to Comment
  • Partying Like It Is 2007 [View article]
    Interesting article!

    I agree but I am not a timer of markets.

    Sticking to healthcare I find good value in GILD/AMGN/CELG/CVS/EW. On the other hand expecting long term healthcare growth at current double digit rates is not a good bet.

    I also am avoiding the small cap shares where valuations are based on M&A. Cancer shows signs of bubble valuations as an estimated 1000 drugs from about 300 companies are all expecting to charge $500k to extend life by a few months.

    On a wider scale when debt begins to lose value stocks will likely follow. Greece isnt a big worry but I suspect bad debts are once again building closer to home. We just arent hearing about it and it may take a long while for it to appear.
    Jun 29, 2015. 12:20 PM | 3 Likes Like |Link to Comment
  • Why Current Prescription Numbers For Afrezza Don't Matter [View article]
    Knowing little about diabetes it seems to me a segment of customers will demand Afrezza. I am hopeful that as people enjoy success using it, sales will explode.

    At introduction few saw the value of the internet. Few even saw the value of the light bulb when it was invented... they said "oh that is nice but I dont know why it is needed". Few could see the value of Netflix 3 years ago.

    I suspect we will see growing adoption. The danger is more likely to be if after trying Afrezza for some reason people decide not to continue using it. That is what would cause me to sell.

    If sales start to take off this stock will explode!
    Jun 29, 2015. 09:29 AM | 2 Likes Like |Link to Comment
  • GE to defend Alstom deal at EU hearing [View news story]
    You should respect your money more than to leave it in GE.

    As an example GE's assets and GE's equity are returning 1%.

    That should tell you that someone buying those assets is going to want a higher return and thus be willing to pay less than the value which GE is carrying those assets on its books.

    The great leaders who built GE in your day are long gone!
    Jun 28, 2015. 08:53 PM | 2 Likes Like |Link to Comment
  • AT&T: Long-Term Investors Will Reap The Benefits Of Management's Recent Expansion Efforts [View article]
    I think for a balance I would add that T has risen because

    - DTV approval may help it support a dividend which has been paid out of borrowed money.

    - things like a 2.75% return on assets is rather small and especially should wireless competition occur with a DISH/TMobile combo

    - FCF of $242MM supporting debt of $100B

    My point is only that T profits have been declining for years with investors only focusing on the dividend. Historically those who ignore declining fundamentals come to regret it.

    If you look at past 10 year results in most categories T has declined and is worse off today.
    Jun 28, 2015. 02:37 PM | 1 Like Like |Link to Comment
  • Gilead Sciences Has The Power To Push Higher [View article]
    One would expect reasonably certain discounts to be accrued in accordance with accounting guidelines.

    However it should be added that John Milligan indicated that the full impact of discounts will take effect this quarter as agreements were reached with some parties late in the 1st quarter.

    Also while I dont think too highly of most GILD analysts, they should have some logic for suggesting lower EPS in 2Q with obviously higher script counts.

    I do acknowledge you have better forecast accuracy but thought I would mention those items.
    Jun 28, 2015. 01:41 PM | 1 Like Like |Link to Comment
  • Gilead Sciences Has The Power To Push Higher [View article]
    I would just add that Barron's seems to get its view from an analyst with a very negative outlook.

    Not sure why the negative analysts are able to keep their jobs when they appear to refuse to look at script data and add a few numbers together. If their companies really relied on them, they would have lost a lot of money.

    GILD sales have doubled since negative analysts first predicted a peak in sales. GILD has even outlined higher expectations.
    Jun 28, 2015. 01:22 PM | 3 Likes Like |Link to Comment
  • Gilead Is Set For Another Strong Quarter [View article]
    So risk going to jail and destroying the company? not likely!

    Companies are much smarter than that anyway. They generally dont take unilateral actions to destroy the value of a market. It becomes clear rather quickly what the expectations are as a new competitor carves out a piece of the market.

    When it gets uncomfortable companies will try temporary measures to avoid permanently decreasing the market long term. Eventually everyone gets what they want with undue damage.

    Consider the size of a damage lawsuit if GILD were to be conspiring to fix prices.
    Jun 28, 2015. 12:56 PM | Likes Like |Link to Comment
  • Gilead Is Set For Another Strong Quarter [View article]
    Ptatty

    Some of us think GILD pricing strategy included a high initial price and significant volume discounting to open up markets in 2015. ESRX and ABBV were a minor component in price discounting under that theory.

    We may see this year how valid that theory is with minimal additional discounting. Especially given MRK's significantly inferior product which will be similar to ABBV. I say inferior because it has a lower effectiveness in genotype 1 patients and no successful track record of patient history.

    As for VP, its main advantage is cost shifting where ESRX is able to reduce the flow of customers wanting treatment for a few years and moving this aging cohort onto Medicare.

    I want to see what the VP effective cure rate actually is since that has been closely guarded information. ABBV wont release that information while GILD has stated that cure rates match their previous trials and expectations.
    Jun 28, 2015. 08:36 AM | 1 Like Like |Link to Comment
  • Gilead Is Set For Another Strong Quarter [View article]
    DTM

    $3.72 is a huge number. Thanks for sharing!
    Jun 27, 2015. 09:17 AM | Likes Like |Link to Comment
  • Gilead Sciences Has The Power To Push Higher [View article]
    My view on GILD.

    So GILD has grown into my largest holding.

    I am not willing to sell until I see a change in HCV revenue and I dont see one. With world sales coming on line it is hard to project a drop in revenue.

    Once revenue clearly has peaked in the future I can assess valuation. At what I think is a 10 PE on 2015 EPS more upside exists. Just as importantly the downside is limited.

    I continue to be comfortable that outside of a major event $12 EPS X 12 PE = $144 is reasonable and I am not likely to trade below that level.

    I would add that numerous events could bump GILD shares higher. That would include, Japanese or world growth spurts, an acquisition, TAF generating increased profit expectation, an increase in revenue and earnings estimates, an additional stock buyback or a pipeline event.

    Investors deserved this recent bump in share price and will likely get more.
    Jun 26, 2015. 08:12 PM | 3 Likes Like |Link to Comment
  • Gilead Is Set For Another Strong Quarter [View article]
    Richbar

    I do disagree with your assertion that if revenues and earnings are flat GILD is reasonably valued.

    I see no evidence that any pharma company is trading at a 10 PE and think MRK would be an example of a company that has been flat for years and trades at a 15 PE. If you had stated based on a risk of losing business that would be more debatable.

    Lets be realistic, GILD trading at a 10 PE implies losing profits in the future. We should agree that all of the flat pharma companies trade above the level of GILD. If not name some 10 PE pharmas!
    Jun 26, 2015. 06:39 PM | 3 Likes Like |Link to Comment
  • Isis Pharmaceuticals: Another Regeneron (Or Even Better) In The Making? [View article]
    Think

    Thanks for an excellent contribution!
    Jun 24, 2015. 07:15 AM | Likes Like |Link to Comment
  • Profit From The Pharma Craze: Sell Gilead, Buy Taro [View article]
    This is a classic case of taking a company few are aware of and even fewer care about and compare it to GILD. Of note...

    - using the term "We" in responding about Taro

    - had to laugh at the comparison of the toenail fungus cream Taro vs GILD's products

    - interesting that no institutions have holdings and insiders own most of the stock, can I suggest pump and dump
    Jun 23, 2015. 04:12 PM | 3 Likes Like |Link to Comment
  • Bank Of America Should Trade For Book Value [View article]
    I like BAC for a value play. It should trade for more than book value.

    What I think has more potential than many is breaking off Merrill Lynch. Dont get me wrong I am not suggesting it is a probability.

    What I am suggesting is that huge shareholding entities do have a lot of pull and a separate ML would create a huge return.

    - The power of the Merrill Lynch brand is huge
    - Lets face it many hate Bank of America and will for a long time
    - There is no question what is in the shareholder best interest
    - The only people who could be against it are BAC executives

    So one could argue that either BAC's Board of Directors would come to that view or under performance will continue to push the cause.

    Jun 23, 2015. 01:19 PM | 2 Likes Like |Link to Comment
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