๐ Why Gilead, which has been sluggish for a decade, is again getting hot Wall Street attention.
Do you know the word Gilead Paradox?
Gilead Sciences, which had a share price of $122 as a cure for hepatitis C in 2015.
However, sales plummeted because the patients disappeared โbecause they treated so well.โ
It was unprecedented for a new drug of destructive innovation to cure the disease itself.
However, Gileadโs stable cash flow disappeared as the pool of patients to be treated paradoxically disappeared.
But now this company, which has been forgotten for a decade, is now back in the spotlight on Wall Street.
๐ What has changed?
In the past, 90% of sales were treatment for hepatitis,
Now, HIV treatments are 70% and oncology is rapidly growing.
In particular, the demand for the HIV drug โYesztugoโ is exceeding expectations,
Analysts have raised their target price to $127. (Currently up about 14%)
๐ก Gileadโs dilemma in the pharmaceutical industry and the cycle shift
โCuttingโ is best for patients, but for companies, it means a drop in sales.
So, pharmaceutical companies have no choice but to focus on โchronic disease managementโ drugs rather than cure.
Gilead has now reorganized its business around drugs that need to be taken for life like HIV,
As a result, we have a predictable cash flow.
Now, Gilead is entering the โmaturityโ of the industrial cycle from biotech, which relies on innovative new drugs, to a pharmaceutical company that generates stable cash flow.
๐ฏ From an investorโs point of view
Undervalued area at 13x P/E in 2026
Dividend yield is about 4%
highlighting oneโs attractiveness as a defensive player
Additional growth is possible as HIV prevention market enters
However, rather than expecting high growth
The view of โstable dividend + gradual recoveryโ is appropriate.
In the ๐ article, how Gileadโs business transformation took place,
And how the structural contradictions of the pharmaceutical industry have implications for investment
I analyzed it in detail.
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