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Shares of Gilead Sciences (GILD) are off to a good start on Monday, rising 2.5% to $67.90.

The stock is rallying on two bits of information, the first of which hit over the weekend. The company will invest $5.1 billion in Galapagos (GLPG) to up its stake in the company.

Gilead will raise its stake to 22% from 12.3% when it pays $158.43 per share for its new equity. For its part, Galapagos will seek shareholder approval to allow Gilead to increase its stake to 29.9% in the future.

The market seems happy with the move, even as biotech stocks have been under pressure lately. Decisions out of the White House haven't been helping, as the government continues to keep a close eye on drug prices.

Further helping the stock on Monday? Wells Fargo analysts upgraded Gilead Sciences to an outperform rating and slapped an $88 price target on the name. That implies 33% upside from Friday's closing price and would send Gilead stock more than 10% above its 52-week high.

Gilead peer Celgene (CELG)  is about flat on the day, as is its acquirer, Bristol-Myers Squibb (BMY)  . However, Amgen (AMGN) , Regeneron (REGN) and Biogen (BIIB) are all higher by about 1% on the day.

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Trading Gilead Stock

Daily chart of Gilead stock.

Gilead stock is moving nicely on the day, but it has a much bigger test looming ahead.

Provided that the stock can hurdle short-term downtrend resistance (blue line), the $69 to $70 area will be a key test for the stock.

This area was support in Q3 and for part of Q4, but in October, it became clear that Gilead stock was no longer finding this area to be supportive. Instead, it flipped to resistance, and we've seen it playing that role since.

Last month, shares tried to push through this area, but $69 to $70 kept it in check. If it can push through $68 and up into this zone, it puts a far larger breakout on the table. North of $70 and Gilead can really start to climb. Remember, Wells Fargo analysts are using an $88 price target. 

Biotech and drug stocks were trading pretty well until the last month. If they can relocate that upward momentum, perhaps GILD stock and others can start to push higher once again.

For now, though, it's good to see Gilead stock holding up over all of its major moving averages. A drop below $68 would be concerning on the long side, and open up Gilead to a possible decline down to the $61 area.

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.