Important Updates for Investors
Carla Pasternak's Premiere Issue of High-Yield International Just
Released
Income expert Carla Pasternak's debut issue of High-Yield
International covers a Taiwanese manufacturer yielding 9.5%... a
rare Mexican monopoly yielding 13.4%... and other top-performing
investments yielding up to 19.0%.
Government's Biofuel Timetable Could Spell +15,900% Growth
+15,900% growth might seem far-fetched... but it's not. In fact, it
is mandated by law. And I've identified the ONLY stock positioned to
capture this growth.
The
Silver Lining to a Falling Dollar
Despite the U.S. national debt, there is a silver lining for income
investors. This massive spending, combined with movement out of U.S.
Treasuries, is going to take its toll on the dollar, and
international income investors could reap the rewards in the form of
higher dividends. |
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One Blockbuster Drug Could Net
Gilead (GILD) a Half-Billion Dollars |
Published: December
26, 2007
Gilead Sciences (Nasdaq: GILD, $47.14) is a biotechnology
firm that focuses on treatments for infectious diseases. By far, its
most important drugs are Viread, Emtriva and Truvada, all treatments for
HIV.
The company also markets AmBisome for fungal infections, Hepsera for
hepatitis B and Tamiflu for influenza.
Competitive Advantages: Gilead has a solid drug franchise
for HIV treatment. There are few competing HIV treatments that have
demonstrated the same efficacy, and GILD has patent protection covering
its drugs for a minimum of ten years. There are also few drugs in
late-stage trials that would compete with the firm's lineup -- they face
no real near-term competitive threats.
The company has also developed some combination HIV drugs, such as
Atripla, that combine several popular treatments into a single drug.
These drugs should continue to help GILD pick up market share in the HIV
treatment market.
Growth Drivers: The market for HIV drugs will likely
continue to benefit from improved diagnosis and treatment in the coming
years. While there are still many patients who do not know they're
infected with HIV, better education and public awareness has led to
earlier diagnosis in both the U.S. and abroad. As a result, many
patients are discovering their infection and seeking treatment earlier
-- that helps push more growth for the firm's HIV drugs.
One factor that might accelerate that trend is that the U.S. Centers for
Disease Control (CDC) recently recommended HIV testing become part of
routine medical care. That could lead to a significant jump in testing
and diagnosis over the next few years.
And Gilead also has some important new drugs that it has recently
launched or are in late stages of development. One example is Letairis,
a treatment for pulmonary hypertension. Analysts believe this drug could
ramp up to produce more than $500 million in annual revenues by the end
of 2010.
Valuation and Outlook: GILD trades at around 25 times
forward earnings and has a long-term earnings growth rate of +16%
annualized. That represents a PEG ratio of 1.77.
At first blush that seems expensive; however, my staff and I believe
there's significant upside to GILD's long-term growth potential.
Specifically, these long-term estimates project only relatively minimal
contributions from new drugs being introduced over the next few years.
And one common criticism of GILD is that its overly focused on a single
product group -- it's treatments for HIV. But new treatments will expand
the firm into new markets and better diversify its income stream.
-- Paul Tracy
Editor
StreetAuthority
Market Advisor
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receive in-depth guidance on today's leading investing
opportunities each month, plus access to five model
portfolios, please subscribe to Paul Tracy's premium investment
newsletter -- the StreetAuthority
Market Advisor. |
Paul Tracy
founded StreetAuthority and became Chief Investment Strategist in 2001. Prior to
that he spent several years as Managing Editor at a multi-million dollar
financial publishing firm with over 150,000 subscribers. In addition to
his role as managing editor and lead financial writer, he was also
responsible for equity research and managing a team of seasoned
professional financial writers, researchers and market commentators.
Paul's previous experience
includes a position at Robert W. Baird & Co.'s full-service
brokerage operations as well as economic research work on a Money and
Banking project funded by the National Bureau of Economic Research. He
has also spent time doing outside consulting and research for the
University of Virginia, has appeared as a guest expert on several
prominent financial radio shows, and has been a featured speaker at
various investment conferences across the U.S.
Paul graduated with a B.S.
in Finance and Management from the McIntire School of Commerce at the
University of Virginia.
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