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BIO Magazine - Analysts’ Upgrades: Gilead Sciences gains on new Hepatitis C drug Δεκέμβριος 2015
Δεκέμβριος 2015 No38

BIO Market News

Analysts’ Upgrades: Gilead Sciences gains on new Hepatitis C drug
Analysts’ Upgrades: Gilead Sciences gains on new Hepatitis C drug

Gilead Sciences (NASDAQ:GILD), a US research-based biopharmaceutical company, has gained momentum in the market for the past few weeks, and analysts believe there is more to come. Two weeks ago JP Morgan reissued its overweight rating on the stock and a number of analysts have followed for the past week.

Deutsche Bank, Sanford C. Bernstein, RBC capital and Lazard have all adjusted Gilead’s target price by an average increase of 3.3 percent. Gilead Sciences is one of the leaders in the development of a next-generation drug to combat Hepatitis C.  Last week one of Gilead’s competitors in the Hepatitis space, Vertex Pharmaceuticals (NASDAQ:VRTX), announced it would discontinue development of an experimental Hepatitis C drug. The announcement sent Gilead’s shares higher.  Analysts believe the company will have a competitive advantage in the market for hepatitis C drugs.

Gilead, which also develops medicine to treat people with HIV, cancer, and other illnesses, has seen its stock price gain 69 percent for the past twelve months and currently trades close to the analysts' target price, with FY1 P/E of 18.6. Amongst other peers are GlaxoSmithKline (LON:GSK) and Bristol-Myers (NYSE:BMY).


Wolseley PLC (LON:WOS), a worldwide trade distributor of plumbing, heating products and building material, has had its target price upgraded by 3 percent for the past week. Analysts' view on the stock is somewhat mixed, with JP Morgan reaffirming its overweight rating and Deutsche Bank upgrading the stock to Buy, while analysts at UBS cut the stock to a neutral rating. The average rating is however maintained at a Buy level.

Wolseley reports its full year earnings today, where analysts expect a 13.4 percent earnings growth, despite expecting a 2 percent drop in revenues. Expectations have been relatively flat for the past few months. IOver a twelve-month period Wolseley has gained 65 percent in value, and analysts seem to believe the stock has slightly more upside potential. As the company receives roughly half of its revenues from the US, an improving housing market within North America would significantly benefit the stock going forward.


Analysts now believe Goodyear Tire & Rubber (NYSE:GT) as well as other U.S tire makers will bounce back after struggling in recent years. Analysts are not expecting tire prices to dropm even though tariffs on Chinese tire imports are expiring. Furthermore, the price of raw materials for tire production have fallen 18 percent since April.

Despite the positive outlook from analysts, GT’s EPS and sales expectations for next fiscal quarter have been taken down by a few points in recent weeks. GT reports its quarterly earnings on October 26.

Gap Inc (NYSE:GPS) continues to be amongst analysts’ favorited. Since end of July, analysts have increased Gap’s target price by 29 percent. Gap has delivered strong sales numbers for several months in a row and has outperformed its peer specialty retailers, with a 30 percent increase in market value the past 3 months, and 114% the past twelve. Furthermore, the short interest on the stock has reduced by 40 percent for the past month.

Several other stocks were upgraded the past week, check out the top ten in table 1.


For additional details about these stocks, take a look at Saxo Bank’s Equity Research offering here.  

http://www.tradingfloor.com/posts/analysts-upgrades-gilead-sciences-gains-on-new-hepatitis-c-drug-856250351

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