Survey: how high do $GILD's Sovaldi sales need to be tomorrow to move the stock up?— Meg Tirrell (@megtirrell) July 22, 2014
To which I replied:
The buyside "whisper number" for Sovaldi sales in the June quarter stands at $3.5 billion. But everyone who follows Gilead knows this, which means the "whispered" whisper number for sales of the blockbuster hepatitis C drug is probably more like $4 billion or more.
Gilead shares have been trading very strongly into Wednesday night's earnings report -- another indication investors expect a big Sovaldi sales number already. [Gilead has also been buying a lot of its own stock back recently, helping performance.]
As long as Gilead doesn't crap the bed entirely, the second quarter's performance seems largely irrelevant ahead of the FDA approval decision in October (or sooner) for the single-pill, fixed-dose combination of Sovaldi and ledipasvir. This is the hepatitis C therapy (no interferon or ribavirin required) everyone has been waiting for. Wall Street will be watching the launch of this product VERY closely.
There will be a lot of volatility and trading around Gilead earnings, but buying on weakness has been a profitable investment strategy this year because the long-term bull thesis remains intact. On Wednesday's call, I'd like to hear management talk about what's next beyond hepatitis C and oncology.
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