Forget Gilead Sciences (GILD), Buy These Biotech Stocks Instead …
Gilead, without a doubt, has proven itself to be a leader in the biotechnology industry. The stock has had an extremely bullish pattern over the last four years, growing over 400% in stock price since March 2011. However, over the last 6 months, the stock has seen a loss of about 5%.
In fact, there has been a considerable amount of insider selling going on for Gilead Sciences as of late. On Monday, two notable high ranking employees of Gilead made hefty sales of their shares of (GILD – Analyst Report). EVP Paul Rutherford Carter sold 2000 shares in a transaction worth $208,360. Director Richard James Whitler sold 5000 shares of GILD for $517,150.
If that wasn’t enough, the stock has seen its earnings estimates take a hit in recent weeks, forcing the stock to receive a downgrade in its Zacks Rank. GILD now has a Zacks Rank #4 (Sell) and could be facing some near term pressure unless it can recoup some of its lost momentum.
Fortunately for biotech investors though, there are plenty of other options out there. And if you are currently invested in Gilead, we have three top ranked stocks below which may likely serve as better alternatives in the short term because of a combined criteria of growth, valuation, and earnings statistics, making them potential replacements for GILD:
Cambrex Corporation-CBM
Cambrex Corp. is a global company that makes and markets a wide range of specialty and generic therapeutic treatments. The company has a Zacks Rank #1 (Strong Buy). It has an estimated growth rate this year of 35.2%, while Gilead’s is only projected to be 28%. The growth estimate for this quarter is 380%, while Gilead’s isn’t even a third of that.
CBM has a nice debt/equity ratio of 0.24. It also has a price to book ratio of 4.3, less than half of Gilead’s. There has been movement in the consensus estimate from the last 30 days, with a calling for earnings of $0.19 per share a month ago, to a current consensus of $0.24 per share. Cambrex reports its earnings on 5/1/15.
Affymetrix Inc-(AFFX – Analyst Report)
Affymetrix is a pioneer in the biotechnology industry, inventing the world’s first high density microarray. The company has now defined the standard in molecular biology research. Their technology is used around the world by top pharmaceutical, diagnostic, and biotechnology companies. AFFX has upgraded in the last week, going from a Zacks Rank #2 (Buy) to a Zacks Rank #1 (Strong Buy).
The company has a nice price to book ratio of 3.18, while Gilead triples that at 9.9. Additionally, AFFX has a debt/equity ratio of 0.46. What is especially impressive about Affymetrix is the fact that it has beaten our earnings consensus in each of the last 4 quarters by an average of 77.98%. Gilead has also surprised in each of its last four quarters, but it beat our consensus by an average of 37.53% instead. AFFX reports earnings on 5/7/15.
Theravance Inc-THRX
Theravance focuses on making and commercializing medicines for unmet medical needs across an array of therapeutic needs for people with respiratory disease, bacterial infections, gastrointestinal disorders, and more. The company currently has a Zacks Rank #1 (Strong Buy). Expect more volatility with the stock as it has a beta of 2.23. THRX also gives out a considerable 2.6% dividend.
There has been movement in the EPS consensus estimate trend. 30 days ago, the EPS called for a loss of $0.12, and since then the consensus has improved, with a current estimate calling for a loss of only $0.08. This is the opposite when it comes to GILD though, as the consensus has gotten worse over the last 60 days. Two months ago, the consensus called for EPS of $3.49. The EPS has drastically decreased since then, now calling for EPS of $3.13. THRX reports its earnings on 5/5/15.
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Forget Gilead Sciences (GILD), Buy These Biotech Stocks Instead …
