Should You Invest in Gilead Sciences Today?

Gilead Sciences (NASDAQ:GILD) is one of the largest biotechnology companies in the world, seen by some as a leader in this field. 

However, this aspect has caught the attention of several investors around the globe. Its price-to-earnings ratio failed to meet the industry’s average of 11, going for a 10 instead.

What does it mean? Should investors take this shot and buy the stock at a bargain price? Or should they ignore the stock entirely? Let’s go over the details and find out.

How Are the Company’s Finances Looking Today? 

The COVID-19 pandemic has affected Gilead Sciences’ business performance, just as it has done for other companies. However, this case separates itself from the rest, as it has done so in a positive way. A surprising turn of events, isn’t it?

Gilead Sciences is the company behind the antiviral drug Veklury, which has significantly increased sales numbers ever since the pandemic started. 

During the company’s third quarter, Veklury sales amounted to up to $1.9 billion in revenue. That was almost double the amount from the previous year. 

However, we should note that the sales performance of Gilead’s non-COVID-based products dropped by 3% around the same time. 

Luckily, this course of events wasn’t enough to drop the entire company. According to Gilead’s third-quarter report, the company’s overall revenue increased by 13%, which translates to roughly $7.4 billion.

Nonetheless, we do invite investors to think past the pandemic. How would this impact the company if it were to end anytime soon? Should we be worried about the decreases for Gilead’s non-COVID ventures?

There’s Still Enough Room for Growth

First, let’s ask ourselves. Why did these ventures drop in the first place? Because these treatments were not compatible with COVID-based treatments for several reasons. One’s growth was cutting down the others.

With that in mind, we can assume that if COVID were to end anytime soon, these other treatments would start to rise again. 

If you didn’t know, Gilead is the leading company in HIV medicines. And it remains as such, even if HIV treatments have taken second place to COVID-based ones. For us investors, we can expect the respective sales to be meaningful once they can kick-start themselves.

Additionally, Gilead Sciences is now working towards expansion. To name a few examples, it is currently aiming for new manufacturing facilities and expanding its lineup with new products. 

Given Gilead’s previous performances, we expect these ventures to prove their value once they’re given enough time. Not to mention, they guarantee an actual life past the pandemic.

With a current dividend yield of 4.14%, we see have no trouble in seeing Gilead Sciences as an excellent opportunity for an investment.