Why Gilead, which has been sluggish for a decade, is again getting hot Wall Street attention.

๐Ÿ’Š 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 โ€œbecause they treated so well.โ€
It was unprecedented for a new drug of destructive innovation to cure the disease itself.

However, Gileadโ€™s 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.

๐Ÿ“Š 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 โ€œYesztugoโ€ is exceeding expectations,
Analysts have raised their target price to $127. (Currently up about 14%)

๐Ÿ’ก Gileadโ€™s dilemma in the pharmaceutical industry and the cycle shift

โ€œCuttingโ€ is best for patients, but for companies, it means a drop in sales.
So, pharmaceutical companies have no choice but to focus on โ€œchronic 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 โ€œmaturityโ€ of the industrial cycle from biotech, which relies on innovative new drugs, to a pharmaceutical company that generates stable cash flow.

๐ŸŽฏ From an investorโ€™s point of view

Undervalued area at 13x P/E in 2026
Dividend yield is about 4%
highlighting oneโ€™s attractiveness as a defensive player
Additional growth is possible as HIV prevention market enters

However, rather than expecting high growth
The view of โ€œstable dividend + gradual recoveryโ€ is appropriate.

In the ๐Ÿ“Œ article, how Gileadโ€™s business transformation took place,
And how the structural contradictions of the pharmaceutical industry have implications for investment
I analyzed it in detail.

https://themiilk.com/articles/aef0793a3?u=3e083717&t=abd421ba8&from=
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