Seeking Alpha

jstratt

jstratt
Send Message
View as an RSS Feed
View jstratt's Comments BY TICKER:
Latest  |  Highest rated
  • Why I Bought The Dips In Both Gilead And Achillion Today [View article]
    I thought I would add some of the positive things that have happened to GILD already in 2015.

    1) The US HCV market has expanded significantly in volume expected - perhaps 20%
    2) The world has approved GILD products much more rapidly than expected and volume is rapidly expanding or exploding
    3) The HCV market is more profitable than expected with increasing margins rather than decreasing margins.
    4) 1Q earnings and revenue surged above expectations with the strongest performance in the S&P500
    5) ABBV has provided little competition and GILD market share is dominant
    6) Harvoni has developed into a mega blockbuster
    7) Cash flow projects to be $5 billion higher than expected
    8) HIV has TAF being introduced this year with higher profit margins expected
    9) The pipeline has grown bigger and more visible
    10) Forward EPS estimates have risen significantly
    11) EASL concluded GILD HCV products have a strong future vs competitors
    12) The major threats at the beginning of the year ESRX, Pricing, ABBV, MRK, getting drug approvals and margins all have evaporated at least for 2015
    13) a new dividend is coming soon
    14) The ability to value GILD is getting easier to project
    15) Prospects for 2016 have increased and based on the above should increase more

    When you think about it, it has been an outstanding start to 2015.
    May 21, 2015. 12:17 PM | 5 Likes Like |Link to Comment
  • Gilead Sciences: Finally Gaining Momentum [View article]
    Mehendvi

    What GILD does have is a history or consistent growth and excellence where they have developed about a dozen billion dollar drugs in a decade. They will introduce TAF this year which has multi billion potential. Simtuzumab has potential in billions for NASH.
    Idelalisib and Momelotinib have strong billion dollar potential in Oncology.
    GS-5745 is starting to get significant attention
    HBV combination drugs have multi billion potential

    GILD is actively looking to purchase more billion dollar drugs with the huge HCV cash flow. So I would say that GILD has a track record suggesting it is one of the best long term investments.

    It is just that nothing likely has the potential to rival HCV where in 18 months sales go from 0 to $13 billion or whatever the correct number is.
    I would add that HCV is just getting introduced around the world and may have an additional 5 billion in international revenue to add.
    May 20, 2015. 10:40 PM | 2 Likes Like |Link to Comment
  • Why I Bought The Dips In Both Gilead And Achillion Today [View article]
    Actually I credit you and other SA contributors for that. Reading SA made it clear that both revenue and EPS should be much higher than analysts were projecting in 1Q.

    Also watched the script growth each week for Harvoni surge. I should maintain my discipline and sell those shares but 2Q is going to beat 1Q based on script data and analysts estimates are still very low.

    This quarter may well show the power of international expansion. My understanding of the UBS presentation was that 200k higher fibrosis Japanese need immediate HCV treatment and GILD has the only approved alternative.
    May 20, 2015. 06:58 PM | 2 Likes Like |Link to Comment
  • General Electric Suddenly Became Expensive [View article]
    GE=Government Electric

    Regulators forced GE to finally sell GE Capital assets here in the US

    The French government realizing it had an opportunity has gotten GE to agree to sell more intellectual property to complete the Alstom deal.

    Meanwhile over the past decade every meaningful performance metric has declined. Shareholders need to recognize that a major portion of the $350 billion in debt needs to be repaid.

    Jeff Immelt and the entire BOD should be replaced and recognized on a wall of shame for their disgraceful pathetic performance. Before it is over I think that may happen.
    May 20, 2015. 06:40 PM | 5 Likes Like |Link to Comment
  • Why I Bought The Dips In Both Gilead And Achillion Today [View article]
    Great article! As always an interesting perspective.

    I am sitting tight with my GILD as I bought more in addition to my intended long term position before earnings. For the next two quarters I think EPS and revenue gains have to push the share price ceiling higher.

    I will look at ACHN and consider it given the information provided as a starter. I am intrigued by the quality of the science that several different sources agree exists. One problem is a biotech portfolio keeps gaining and taking over a larger percentage of a total portfolio. It makes it hard to clear room for new ideas.
    May 20, 2015. 04:33 PM | Likes Like |Link to Comment
  • Gilead Sciences: Finally Gaining Momentum [View article]
    I just have a feeling that GILD will hit a new high before it goes ex div on Jun 12. The previous high is $116.83. That is a long way in a short time and certainly not typical of the last 7 months trading.
    May 20, 2015. 01:18 PM | 5 Likes Like |Link to Comment
  • Gilead Sciences: Finally Gaining Momentum [View article]
    Great article!

    Lots of news today from BMY, to JNJ/ACHN but sometimes one needs to ask if anything really has changed?

    The answer in my mind is that GILD deserves to trade at a premium to the market and not at a price reflected by zero forward growth or its curent valuation which would suggest future decline.

    What I see is a company with greater growth prospects than other pharma companies and a normal risk profile, trading at a 33% discount to its industry. My guess is next year at this time it will be worth 30% more than it is today.

    I dont expect the markets to adopt my view of GILD value at a 17 PE X $11.50 2015 GAAP EPS = $195.50 any time soon. Nor do I expect it to value GILD at $10 x a 10 PE =$100.
    May 20, 2015. 12:02 PM | 3 Likes Like |Link to Comment
  • My Primary Care Provider's Take On Afrezza [View article]
    Wow what a tough crowd!

    I bought some MNKD shares awhile back as Afrezza seemed like a good idea and one which would seem to appeal to a segment of customers. It is high risk capital and I noted several things that were danger signals such as the retirement of Mann.

    Then came a share price drop and recommendations to sell. I considered selling but decided that wasnt a great move. Right or wrong I need to let things play out.
    I will hold the shares of MNKD until Afrezza has a chance to meet the market with a proper conclusion.

    Maybe in 6 months to a year it will become apparent whether a segment of diabetics large enough are willing to adopt Afrezza. As a relatively uniformed investor it seems that new patients might be the most likely adopters and it could take while to build a user base.

    If I was going to cut and run on initial bad news I should not have invested in the first place. An innovative new product has been approved, introduced and I think it will be noticed in the market.

    Whether a large enough segment of insulin users will adopt is the question and I will take no action until I feel I understand that conclusion.

    Historically many good ideas have not met with strong initial success. When the light bulb was invented shocking to me anyway, many could not see the need for it. The same for the telephone, computer, internet, Netflix or video games to name a few.

    I could likely lose my investment or should a segment of users see the merit it could have great success. Selling now would be more about my failings as an investor than about MNKD or Afrezza.
    May 20, 2015. 12:50 AM | 2 Likes Like |Link to Comment
  • Gilead's Management Presents at UBS 2015 Global Healthcare Conference (Transcript) [View article]

    In spite of the CFO suggesting sustainably higher US HCV volume in 2Q than in 1Q , and stronger international demand, analysts continue to forecast a 10% drop in EPS from $2.94 to $2.66.

    A more rational expectation for 2Q might be $3.15. Even that seems conservative given higher US demand, a first full quarter for much of Europe and what could be huge Japanese demand starting up.

    Did she really say regarding HCV "we do believe and we model at the least the decade or more of opportunity there relative to our current market" So am I to believe HCV volumes will remain at least at current levels through 2024?

    Did she say dont worry about volumes of HCV patients?
    Did she say that TAF would improve margins in HIV?

    Cause I am fairly sure GILD is still trading at a 9+ PE on reasonable EPS estimates for 2015. Even better is trading at 8 times expected 2015 OCF which I estimate at $20 billion.
    May 19, 2015. 03:56 PM | 5 Likes Like |Link to Comment
  • Gilead's Management Presents at UBS 2015 Global Healthcare Conference (Transcript) [View article]
    Some positives

    HCV

    - US is at a rate that Robin feels is sustainable in a worst case scenario
    - Europe at a 100,000 patient rate but larger overall than US in patients
    - Japan 200,000 g2 patients that need to be treated now and Sovaldi only option
    - Other countries need to be counted Canada, Australia, Mexico, Brazil, E Europe...

    TAF

    - higher margins
    May 19, 2015. 02:12 PM | 3 Likes Like |Link to Comment
  • Senator's HCV Rant Won't Slow Gilead [View article]
    GILD - Robin Washington's presentation at UBS had some interesting points

    Acquisition question - The first words spoken in the reply were Oncology and Immunology

    2Q HCV volume is higher than 1Q but has it peaked? - It is too early to tell if it has peaked in the US. We see it as sustainable at current levels whether or not peak has occurred.

    Europe has just started, 100k patients can be treated in Europe which has a larger HCV population than the US. Overall more focused on fibrosis level than US.

    Japan sees 200k advanced patients with genotype 2 and no other treatment options. ( My conclusion is to increase HCV treatment estimates for Japan )
    May 19, 2015. 11:41 AM | 1 Like Like |Link to Comment
  • Senator's HCV Rant Won't Slow Gilead [View article]
    Question

    Will the cure rate for a Viekira regimen get published and when? What if it is inferior to Harvoni as might be expected given more pills required over a longer duration and with more side effects?
    May 19, 2015. 11:19 AM | 1 Like Like |Link to Comment
  • Senator's HCV Rant Won't Slow Gilead [View article]
    I noted with interest the discussion on this article and the forceful arguments.

    I would bet that GILD has a program where if a person with a high level of fibrosis is denied treatment, GILD actively works to resolve the issue and would ensure the treatment is provided.

    I believe I would be hearing about deaths from those denied if that was occurring. Short of saving a life of someone with no resources or insurance, GILD should remain incentivized to cure HBV and NASH.

    How many lives have been saved by medical advances? Why is it so many advances are developed here in the US? I especially want BIIB to progress on Alzheimers. I may need that one day only to find out the program was stopped because profits were being confiscated back in 2016.
    May 18, 2015. 12:00 PM | Likes Like |Link to Comment
  • Johnson & Johnson: The 'Tragedy' Of Paying 17 Times Earnings [View article]
    I would say JNJ is a good value as a quality company in a growing non cyclical industry. PE isnt everything and a low PE doesnt always mean it is a good value.

    As an example the only time I didnt own JNJ since 1990 was during 2010-12. At that time the leadership was very poor and JNJ had lost control of their business. In their consumer goods people were finding bits of metal, in knee or hip replacements defects were being found. Products were being pulled off the market, lawsuits being filed and it was a mess.

    So yes to look back they had a low PE but they were losing sales, failing in every division and not the company you think of today. It was a brief period of time.

    Today you have a good storehouse of value that should increase through good markets and bad. The PE is fair for what you get. To really appreciate JNJ you have to own it through a bear market. Then the returns for a full cycle can be impressive vs other alternatives which may both rise and fall at a more rapid pace.
    May 16, 2015. 06:45 PM | 1 Like Like |Link to Comment
  • WSJ: Moynihan's "fixer" reputation still being tested at BofA [View news story]
    As a long term shareholder I am reevaluating my positioning in banking and financial companies.

    BAC is cheap but perhaps its value is less than some other alternatives. As an investor I have made significant returns in the past. As a customer I have had some of the worst experiences so I see both sides.

    Right now I am focused on 2015 returns rather than reading or writing a history on the company. The thesis that after clearing away much of the crisis legal activity, BAC should excel is in question.

    One thing is clear, you can add investors to the many groups that have questions about BAC including regulators, customers and businesses. How much damage to the BAC brand has occurred and how much confidence in leadership exists are also open questions.
    May 15, 2015. 06:22 PM | Likes Like |Link to Comment
COMMENTS STATS
2,892 Comments
4,326 Likes