Biotech Updates: Analysts Offer Commentary on Gilead Sciences, Inc. (GILD) and Sarepta Therapeutics Inc (SRPT)


Gilead Sciences, Inc.

Leerink Swann analyst Geoff Porges reiterated an Outperform rating on shares of Gilead Sciences, Inc.  (NASDAQ:GILD), while reducing the price target to $120 (from $123), after the company disclosed “softening HCV sales in Q1 2016 based on growing rebates, more government purchases, and shorter treatment duration.”

Porges commented, “This was consistent with our cautious views on this franchise, but occurred sooner and to a greater degree than we had anticipated […] Our longer-term forecast of steadily eroding HCV revenue is unchanged. We now forecast Gilead 2016 US HCV revenue of $8.7bn, 5% less than our prior $9.2bn estimate. Our revised forecast reflects a 1.3% sequential compounded decline each quarter in realized revenue per start, and a 12% compounded decrease in revenue per Rx (the other approach we use to estimate quarterly sales). These declines are significantly less than the 23% QoQ decrease in realized revenue per start experienced in Q1, assuming that while some of the rebating and contract headwinds in Q1 don’t persist in Q2, many others certainly will. Our adjusted total HCV revenue forecast for the company is now 2% above consensus for 2016 and 5% above consensus for 2017.”

According to, analyst Geoff Porges has a yearly average return of 2.5% and a 57% success rate. Porges has a -1.7% average return when recommending GILD, and is ranked #1526 out of 3990 analysts.

Out of the 23 analysts polled by TipRanks, 16 are bullish on Gilead Sciences stock, while 7 remain sidelined. With a return potential of 38%, the stock’s consensus target price stands at $115.89.

Sarepta Therapeutics Inc

Baird analyst Brian Skorney weighed in today with a favorable report on shares of Sarepta Therapeutics Inc (NASDAQ:SRPT), after the drug maker announced that it intends to raise approximately $37.5 million in a stock offering. Shares of Sarepta are currently trading at $20.08, down $0.91 or -4.34%.

Skorney noted, “Given that a raise needed to happen to sustain manufacturing contracts for the next few months and the recent bump in the stock price, management could have taken the opportunity as a chance to do a significant raise. However, we think restraint here indicates that management sees potential for improved cash flow in the future and remains optimistic about a larger raise at a higher price in the future, post potential approval.”

“Recall, at the time of last year’s NDA filing, Sarepta raised $40M in debt financing. At that time, the company had less than $120M on the books in cash and investments. At a burn rate of about $125M a year, that left the company with less than a year’s worth of cash on hand. Post-raise, Sarepta ended 2Q15 with $157M, enough to sustain the company through NDA acceptance, after which a larger equity raise was done. We believe this deal is very similar in that it is essentially a temporary fix to tide the company over to a much more meaningful data point,” the analyst added.

The analyst reiterated an Outperform rating on shares of Sarepta, with a price target of $23, which represents a potential upside of 15% from where the stock is currently trading.

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brian Skorney has a yearly average return of 2.9% and a 53% success rate. Skorney has a -24.1% average return when recommending SRPT, and is ranked #942 out of 3990 analysts.


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