Gilead Sciences beat quarterly expectations and raised its guidance on the back of its Covid drug, Veklury, leading GILD stock to surge Wednesday.
Veklury sales tumbled 46% during the June quarter to $445 million. But that beat forecasts. This year, Gilead boosted its full-year outlook by $700 million at the midpoint. The company now expects Veklury to bring in $2.5 billion in sales this year, up from its prior guidance for $2 billion.
The quarter should help Gilead solidify its position as a value name trading at a low multiple, RBC Capital Markets analyst Brian Abrahams said in a report.
"A solid quarter, with seasonally favorable HIV dynamics looking even better than expected, strength in cell therapy which could increase enthusiasm about that market opportunity in earlier lines, good international Veklury update, solid expense control and revenue/EPS guidance raises," he said.
On today's stock market, GILD stock jumped 4.6% to close at 62.27.
GILD Stock: Sales Unexpected Climb
Overall, second-quarter sales unexpectedly climbed 1% to $6.26 billion. Analysts expected sales to drop to $5.86 billion. Adjusted profit came in at $1.58 per share, 6 cents better than expected. Profit toppled about 13% due to an upfront payment and a royalty expense related to HIV drug Biktarvy.
Excluding Veklury, Gilead's sales rose 7%. Strong performers included Biktarvy, which brought in $2.56 billion in sales, up 28%. Biktarvy topped forecasts for $2.33 billion to $2.35 billion, RBC analyst Abrahams said.
Across the board, sales of HIV treatments increased 7% to $4.22 billion, helping offset declines for the hepatitis C and hepatitis B/D treatments. Revenue from cell therapies for cancer popped 68% to $368 million.
For the year, the biotech company guided to $24.5 billion to $25 billion in product sales, which excludes revenue from collaborations and licensing. That includes about $2.5 billion from Covid treatment Veklury. Gilead also expects to earn $6.35 to $6.75 per share, minus some items.
GILD stock analysts predicted adjusted earnings of $6.56 per share and $24.59 billion in sales.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
