Seeking Alpha


Send Message
View as an RSS Feed
View jstratt's Comments BY TICKER:
Latest comments  |  Highest rated
  • Why I Bought The Dips In Both Gilead And Achillion Today [View article]

    I like many of your points and the insight offered on a consistent basis.

    Regarding share price I think it is just on the floor of an elevator. 2Q will exceed 1Q by most measurements and each day that becomes more certain.

    Arent you a Japan expert?

    If so what did you think of GILD getting approved at a $43k price in Japan with additional discounting after $1.64 bil of revenue reached?

    What did you think about Robin CFO stating Japan has 200k people needing treatment now (ie higher fibrosis) and GILD is the only approved alternative?

    On the face of it GILD should get a big bite out of $8+ billion near term revenue market. Your thoughts!
    May 22, 2015. 01:45 PM | 1 Like Like |Link to Comment
  • Gilead, Merck And Achillion/J&J Square Off In An HCV 'Nuc'lear Showdown [View article]
    Best of luck to you! I especially like reading the views of those who have or have had Hep C.
    May 22, 2015. 11:00 AM | 1 Like Like |Link to Comment
  • Why I Bought The Dips In Both Gilead And Achillion Today [View article]
    I dont know but I wonder if regulators around the world would willingly allow GILD to corner the market so to speak. I am a strong capitalist but even I would have to think about that one at least a little.

    Would it be sort of like having a toll booth at the only watering hole in the desert?
    May 21, 2015. 04:46 PM | Likes Like |Link to Comment
  • Gilead, Merck And Achillion/J&J Square Off In An HCV 'Nuc'lear Showdown [View article]
    Small Pharma

    I am not sure when I have read an article as impressive as this one. After I write this comment I feel I need to go back and take notes.

    The ACHN market size estimate was interesting as well. For those interested CNBC flashed a JPM chart yesterday mid afternoon with a much steeper slope or drop off. GILD seems to be saying they dont see a problem with patient volumes for the next 10 years. I tend to like the ACHN chart for reasonableness though its peak may be too low.

    JNJ obviously feels HCV has a long term market beyond 2020 worth investing in which many analysts do not.

    In my own mind I question the value of saving 2 weeks of treatment in the future. By then I would think anyone would choose a proven safe effective alternative. The price would be adjusted to match a shorter competitor. It is easy to do that when the margins suggest the cost of making the drug is marginally above the cost of tap water.

    Thanks for the opportunity to read your work!
    May 21, 2015. 02:40 PM | 6 Likes Like |Link to Comment
  • 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 | 3 Likes Like |Link to Comment
  • Gilead Sciences: Finally Gaining Momentum [View article]

    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 | 1 Like 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 | 2 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


    - 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...


    - 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 | Likes Like |Link to Comment