Gilead Sciences (GILD) crushed fourth-quarter expectations Thursday and issued an unexpectedly bullish outlook that buoyed GILD stock.
The company hasn’t seen growth this strong since 2015 at the heyday of Gilead’s hepatitis C drug franchise, Chief Executive Daniel O’Day said on a call with reporters. In 2022, total product sales grew 8%, excluding the impact of Covid treatment Veklury.
The lion’s share of growth last year came from Gilead’s HIV treatments and oncology medicines. Revenue from Biktarvy, an HIV drug, surged 20% and topped $10 billion for the first time. Sales of cancer treatments crossed the $2 billion mark, rocketing 71%.
As a result, Gilead guided to 4%-6% growth in its base business. Analysts had forecast a decline.
“Today, our growth is driven by a far more diverse portfolio, including our therapies for HIV and oncology,” he said. “When we laid out our transformation strategy in 2019, this was our aim: To return to growth and to ensure growth would be sustainable.”
In after-hours trading on today’s stock market, GILD stock jumped 2.4% near 83.40. Shares lost 3.1% during the regular session and closed at 81.39.
GILD Stock: Earnings Skyrocket
During the December quarter, adjusted Gilead earnings launched 142% higher to $1.67 a share, beating expectations for $1.51, according to FactSet. Sales inched 2% higher to $7.33 billion — well above Wall Street’s estimate for $6.63 billion.
Sales of Covid treatment Veklury plunged 26% to $1 billion, driven by lower hospitalization rates. But CEO Day sees room for Veklury to maintain a role in Covid treatment as the virus becomes an endemic threat. To date, more than 12 million people around the world have received Veklury.
“Veklury continues to play a role in addressing the public health challenges of the pandemic,” he said.
Excluding Veklury’s impact, Gilead’s total fourth-quarter product sales climbed 9% to $6.3 billion.
The company’s cancer treatments also tacked on another quarter of bullish growth and narrowly beat expectations. Sales of cell therapies Yescarta and Tecartus soared a collective 75% to $419 million. Analysts had called for a total $414 million from the duo.
Meanwhile, Gilead’s breast cancer medicine, Trodelvy, brought in $195 million in sales, growing 65%, but missing forecasts for $197 million.
Sales of HIV treatments also jumped 5% to $4.8 billion — helped by 15% growth from Biktarvy to $2.9 billion. That was narrowly above GILD stock analysts’ call for $2.83 billion.
Guidance Above Forecasts
For the year, Gilead expects $26 billion to $26.5 billion in sales, including roughly $2 billion from Veklury. Analysts had actually called for decline in product sales to $25.67 billion. They had also projected just $1.38 billion from Veklury.
Gilead stock recently fell below the low end of a flat base with a buy point at 89.84, according to MarketSmith.com.
Shares have a strong IBD Digital Relative Strength Rating of 90. This puts GILD stock in the leading 10% of all stocks in terms of 12-month performance.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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