Gilead Sciences, Inc. (NASDAQ: GILD) is having an incredibly rough start to the trading session this morning, and for good reason. The company reported its financial results missing the mark and outlining key concerns surrounding its hepatitis C franchise. Of course, this concerned investors, leading to declines in the value of the stock. Today, we’ll talk about:
- The earnings release;
- what we’re seeing from the stock as a result;
- and what we’ll be watching for ahead.
GILD Reports Earnings
As mentioned above, Gilead Sciences isn’t having a very strong start to the trading session this morning. Unfortunately, the company reported its earnings after-hours yesterday, missing the mark and leading to fear among investors. Here’s what we saw from the report:
- Earnings Per Share – In terms of earnings per share, GILD definitely missed the mark. During the quarter, the company reported earnings in the amount of $1.48 per share. However, analysts expected the company to generate earnings in the amount of $1.67 per share.
- Revenue – Revenue also proved to be a major source of concern for investors. During the quarter, the company generated revenue in the amount of $5.1 billion. This figure also proved to be vastly below expectations.
- The Big Concern – The big concern here has to do with the company’s hepatitis C franchise as well as HIV drug revenues. During the quarter, the company’s hepatitis C sales dropped to $1.05 billion. Just a year ago, GILD generated $2.58 billion from this franchise. Not to mention, the sales were below what analysts expected to see at $1.19 billion. Also, some were hoping to see strong growth in the company’s antiviral and HIV drugs sales. While sales did grow here, the growth was minimal. During the quarter, the company generated $3.33 billion rising slightly from $3.27 billion in the year before.
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. Few bits of news have the ability to cause movement quite like earnings. However, with the negative report provided by Gilead Sciences, the movement is in the downward direction, and it’s moving quickly. Of course, our partners at Trade Ideas were the first to alert us to the declines. At the moment (9:36), GILD is trading at $66.93 per share after a loss of $5.63 per share or 7.76% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on GILD. In particular, we’re interested in following the story surrounding the company’s efforts to bring its hepatitis C and HIV treatment franchises back to strong growth. However, we’re not sure that the company will be able to do so considering the market environment. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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