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Gilead Sciences, Inc. (GILD) Healthcare - Biotechnology | Reports April 28, After Market Closes.

Biopharmaceutical company, Gilead Sciences, is scheduled to report first quarter earnings tomorrow, after the market closes. Gilead has been a hot streak the past 2 fiscal years, beating in 7 of the past 8 reported quarters. Given its track record, it won’t be surprising if Gilead posts another win with its Q1 results. The Estimize consensus is calling for earnings per share $3.23 on $8.21 billion in revenue, 11 cents higher than Wall Street on the bottom and $130 million on the top. Estimates have been on the move since its last report. Earnings per share estimates have increased 10% with revenue also up 4%. Compared to a year earlier, profits are forecasted to rise 10% while sales could increase 8%

Strong earnings have not translated to the market. Gilead stock is down 3% from the prior year and 8% in the past 6 months alone. Fortunately, the stock moves in investors favor throughout earnings season. In the 30 days prior to earnings, shares typically increase 6% and continue to do so through the 30 days following results. 

Over the last four quarters Gilead has posted positive earnings surprises of 5.9% on average, and is expected to beat again this Wednesday. Gilead is the market leader in Hepatitis C treatments, with two popular drugs Sovaldi and Harvoni. Their Hep C franchise, along with other antivirals, make up 90% of the company’s revenue stream. However, the benefit of these drugs to the bottom-line is waning as they have been on the market for a year and half now and are also curative. More competition is set to hit the Hep C market soon, with Merck recently approved to release its rival drug. Merck’s treatment imposes a direct threat to Gilead especially since the drug is cheaper than Harvoni.

In order to diversify revenues, Gilead is focusing on growing other core offerings including HIV and Hep B treatments. Newly launched Zydelig, a treatment for three forms of cancer, is performing well and with a number of new drugs already FDA approved, this could lead to strong revenue growth in the near future. In addition to a solid product portfolio, Gilead possess a robust pipeline of potential products. Additional acquisitions and licensing agreements could help Gilead reach these goals.