The people have spoken.
First of all, it's important to understand that there are no qualifications for posting on Seeking Alpha. If you doubt this, you might examine the remarkable record compiled by Blair O'Neill, the Wrong Way Corrigan of Biotech. He has posted 10 articles on Seeking Alpha, the first on 8/15/13; and in spite of the fact that the biotech index has doubled since that time, he has been putting up goose eggs. His record:
1. 8/15/13. GTX ("A Catalyst Play with Strong Leadership and Future Potential") Recommended @ 4.50. Future potential still unrealized. Closed today @ .73.
2. 8/22/13. SSH. ("A Sleeping Giant") Recommended @12. Apparently still sleeping. Closed today @ 4.18.
3. 9/27/13. ANTH. ("A Promising Future") Recommended @ 4.10. Promise still unfulfilled. During a period when biotech doubles, this one manages to limp up to 4.79. You are thinking, "well he wasn't completely wrong" in which case you missed ...
4.10/31/13. He turns negative on ANTH ("Recent Developments: Both Good and Bad") @ 3.35.
5. 10/23/13. AMRN. ("An Oversold Investment Opportunity") Recommended @ 6.37. Apparently more oversold than ever. Closed today @ 2.34.
6. 10/29/14. APPY. ("Huge Market Potential") Recommended @1.41. Closed today @ .56.
Today I posted some observations about the block trading in GILD becoming more aggressive over recent sessions and was rebutted by carolyn_novice, who maintained that "Block trades are Derivatives." When I asked for an explanation, she seemed to say that she was too busy and that I was wasting her time. She also said that she was "moving to ICLR". When I moved to ICLR, I see that every single post since March 2 was initiated by carolyn_novice ...and answered by carolyn_novice. There are 6 posts on the ICLR board today - all by carolyn_novice, and all of which have been responded to by carolyn_novice. So here's my followup question: If you have time to talk to yourself, why don't you have time to answer my first question?
I was also looking over the fence at IV, seeing our old neighbors Raleightrader, Trader_Rook, Sr.Cosa, et al. and noticed the post by Rocky3 reporting on Goldman's new estimates for GILD. If you only read the carping here about negative growth and the $85 price target, you might miss the fact that Goldman is actually RAISING its 2015 estimates sharply. Specifically, they have raised their estimate of q1 Harvoni sales from $2.1bn to $3.1bn, and their 2015 estimate from $7.6bn to $9bn. Their 2015/16/17/18 eps estimates are being lifted from $8.83/$9.12/$9.84/$9.12 to $9.59/$9.59/$10.29/$9.38. Their q1 eps estimate is raised to $2.58 (vs consensus of $2.25).
Basically, at the beginning of the year, Credit-Suisse and Goldman had their estimates roughly in line. Then, in early February, C-S raised their estimates of discounting and dropped their earnings forecast. Now Goldman is seeing what many here have predicted: a much faster ramping up of Harvoni sales. They are also forecasting the Complera launch in 2015, rather than 2016.
I wouldn't take Goldman's $82/ I year price target all that seriously. They have been consistently wrong - most notably lowering their price target in April 2014, just before GILD made a 40 point run. Also, the forecast of tapering growth into 2017/18, like C-S's, is based on the assumption that no new revenue streams are created, which seems unlikely. Anyway, I am long at the moment and may now add to that position ahead of earnings, but prepared to take any gains early.
There seems to be a little dissension over in IV these days. Raleigh and sr.cosa are down at the Arts & Crafts center, continuing to produce lovely charts demonstrating that GILD is about to break out. Cordari, who sold out of AAPL at 109 in January to put everything behind GILD, has been overheard at the bar of the IV Country Club muttering disparaging things about TA. A lot of his neighbors have chastised him for his intemperate remarks. Now cordari has decided to strike back by selling his 25,000 shares of GILD and his 250 LEAP contracts and going short. This will unsettle many since he is, by his own account, "never wrong". I'm sure glad I live over here in Yahoo! City, where everyone gets along.
Obviously, if you're buying this stock here, you're gambling short term on the outcome of the earnings release. Also, you should recognize that GILD is an anomaly among the bitoechs. Most have very high p/e's on the assumption that their earnings will grow robustly. GILD has a strikingly low p/e because, although current earnings are spectacular, there is skepticism as to how long this will continue. (Harvoni, their most important drug, has the unfortunate side effect of actually curing the disease.) This limits both the upside possibilities and the downside risk. Personally, I think that if you were going to stick your toe into biotech, you would do better to buy one of the funds or ETF's, such as IBB. I would also not make my biotech investment more than 25% of my portfolio. Biotech has been on a fantastic run. If the economy continues to recover, the banks, retailers, transports, cyclicals, --even energy- all of which have been laggards recently, may actually do better than biotechs. If I were going to take a new position in GILD, I would wait until after earnings. As you can gather from the posts here, there is a high degree of euphoria around earnings, which tends to produce a "sell on the news" reaction. The last two earnings releases were very strong, and yet the stock sold off after each of these. Unless the stock were shorted heavily ahead of earnings - which it won't be - it's unlikely that it will rally strongly even on good results.
..plus FREE Wi-Fi and FREE first month's rent! (Does it seem to some of the rest of you that they're pushing this site just a little too hard?) To me, it looks like one of those retirement communities out in the sticks: Very peaceful, with no annoying panhandlers, no screaming children, no door-to-door solicitors, no traffic, ... and, just to complete the pastoral idyll, no people.
Ford sales are accelerating in China, while others are decelerating. This is the biggest auto market in the world. Ford sales grew 19% in China in 2014, and would have grown more if they basically hadn't run out of cars. They opened a new plant at the end of the year and will open another this year. Projections are that their sales in 2015 will grow by 50% over 2014.
Okay, you and Carolyn foolishly didn't cover your short in the low 99's, and now you're trying to convince yourself that you did the right thing. When I'm short a stock and an unexpected piece of bad news (therefore good news) pops up, I always cover at least half.
Amiodarone is a drug of last resort for arrhythmia with many unpleasant side effects. My best friend, when other arrhythmia drugs had stopped working, underwent ablation (the surgical procedure to control arrhythmia) rather than go on amiodarone. The pulmonary side effects are particularly scary. Besides, it turns you blue. (seriously) And there are some studies which call its efficacy into question.
It looks like the IBB made a periodic high on March 20. From its high of that day to today's close, it is off 8.42% Over that same timeframe, GILD is off a mere 4.45%. All of the other major biotechs have done worse: CELG -10.65%. AMGN -7.25%. BIIB -12%. REGN -8.87%. VRTX -13.44%. ICPT -8.5%. The good news here, obviously, is that you have done better by holding GILD over this slump than any of these or the IBB. And Carolyn could have done better by shorting any of these rather than GILD.
I also looked at the performance of 18 smaller biotechs I hold over this period. I expected them to do relatively worse than the majors. Surprisingly they didn't. The performance ranged from TTPH (- 11.81%) to HZNP (+10.74%). I have to thank "betting__freddy", a poster here, for getting me interested in that one. Who says these boards are useless?
I can't resist also noting that in 2014, after GILD had charged upward in spite of the Goldman downgrade, they placed it high on their list of "10 most overvalued stocks". By this, they evidently meant the 10 stocks which had most dramatically surpassed their Goldman price targets. The list might have been better titled "Our analysts' 10 worst calls".
Not in the pharmas, but in the biosimilars - the new breed of knockoff artists. CHRS +5.68%, EPRS +3.91%, and PFNX + 17.72%. (Regarding the latter, would you own REGN longterm if PFI, via its new Hospira acquisition, had just commissioned these guys to knock off eyelea?)
Looks like Gilead just spent another $400 million of that war chest.
Well, perhaps you can explain the oracular "Blocks are due to derivatives" with which she dismissed my observations. She seems disinclined to do so, and has responded with strange analogies about the price of oranges, jumbles of meaningless figures, etc. She pays so little attention that she mistakes me for some overextended GILD zealot, advises me to "do your homework", points out the startling news that the stock is off its highs, and prophesizes dire things for my portfolio. I don't think I've been rude to Carolyn, although I've been sorely tempted.
I asked you to explain your cryptic statement "Blocks are due to Derivatives". You seem to have ducked the question, hiding under the "Let us not waste each other's time" blowoff. Your statement that "Your response reflects you (sic) frustration" because "GILD is not moving in the direction you are used to" is silly. You are the one with a short position and the expectation that the stock will move down, which it has not been doing lately. In fact, looking back, you obviously missed a chance to cover your short down around 97.
But back to my question: What the heck does "Blocks are due to Derivatives" mean? I realize that you are pressed for time, but please take a moment from your busy schedule to enlighten us.
If you really wanted to make a mythical stock advisor believable, you would stop short of post hoc price "predictions" carried out to two decimal places. Only the mentally deficient would believe this. And only the mentally deficient would believe that anyone would believe this.