Stock market acts like a yoyo. What goes up must come down. And what comes down must go up?You bet. You win some then lose some. Frustrated by the zero sum and big boys as small investors? You don't have to be. Pros are delighted. They called their actions "invest" when they buy (you sell) and "profit taking" when they sell (you buy). We called it MM manipulation or market speculation.
My guess is it will close between 100-110.5 depending on how big fish play with their cards. Peak 115-120 sometime in Dec/ Early Jan
Suppose GILD hit $120 instead of $115 on Dec 20. By duality principle, the party may decide to sell 30 K of 110 call @10 & buy $110 put for $1 so that he nets $57M again on the down swing to $100 on Jan 17 2015 if MM cooperates. All in all, Gild went up from 100 to 120 in Dec and back to 100 in Jan for a net change of 0.
Average Joe gained nothing in 2 month. But the smart institutional investor gained $87M+$57M=$144M on $300M investment. 48% in 2 months. Really sweet!!! Isn't it?
Traderrook: Here are what I got.
1) Up 10 points: The bets would create a profit of $27M (vs $30M). Put & call are both worthless. The party spends nothing to make 27M. Something 4 nothing? Real Sweet!!!
2)Down 10 points: the party is all wet on his bets. The party would spend $300M in buying 3M shares & create a loss of $33M ( vs loss $30M). The party is NOT very happy even though he intended to buy @100!
3) Up 5 points: The bets will create a profit of $12M ( vs $15M) when the put is assigned and the call is worthless. The party would spend $300M in buying 3M share
4) Up 15 points (all-time high): The bets will create a profit of $57M ( vs $45M) when the put is assigned and generate $45M and the call is worth $12M. Sweet! The party would spend $300M in buying 3M share. There is a remote chance the party may spend nothing to make $57M too if his option buyer is not on alert. Something 4 nothing? Real sweet!!!
Gilead must provide access to their game-changing oral drug, Sovaldi (sofosbuvir), to people with
hepatitis C virus (HCV) who need it most, through life-saving expanded access and compassionate use
programs. Hepatitis C is the only curable virus. Sovaldi will help to save lives, and stop the epidemic
from continuing to spread.
"We must learn from the HIV epidemic and ensure that affordable prices are in place so that the millions
with Hepatitis C infection can get new drugs that appear to be a cure."
Médecins du Monde
Official European AIDS Treatment Group (EATG) Press Statement to
The International Liver Congress 2014
49th Annual Meeting of the European Association for the Study of the Liver
Sentiment: Strong Buy
Did you read my post? It could go as low as 103.
Weekly Outlook Sentiment Indicator
All medical babies now being thrown out the window with the bath-water?
ABBV, CELG, REGN, JAZZ ... are all up!
One can't guess what days it will go down to day trade?
Did you read Weekly Outlook Sentiment Indicator right above this post?
No reason? There are plenty: Looming competition comes before Christmas. Euphoria about Harvoni script. Senate Hearing on Price of Harvoni/Sovaldi. Coming Option Expiration....
Can my hypothesis be correct? I hate to see that happen as I am long in GILD. But the looming competition & euphoria call for a cool head.
Senator Bernard Sanders is planning a hearing before year end. Read on.
Barron's article Oct 20, 2014.
RBC Capital Markets’ Michael Yee commented,
"We’ve looked at new Harvoni patient authorization forms from Anthem (Express Scripts (ESRX) is the pharmacy benefit provider) and UnitedHealth (UNH) that just came out… We note they have headline language “approval criteria” that reads and attempts to limit/restrict coverage to only the sicker highest risk F3-4 patients. The forms do support 8-12 weeks of Harvoni therapy. Separately, (2) Senator Bernard Sanders is planning a hearing before year end to examine HCV costs to the Dept of Veterans Affairs (VA=10% max HCV volume) which could add some headline risk to be aware of that reminds us of Waxman…"
REGN Non-GAAP EPS 2.52 vs 2.57 consensus. REGN does not include BPD fee in its Non-GAAP EPS.
If it adopted Gilead's accounting practice, it should report Non-GAAP $2.17 instead. Instead of miss by a nickel, it will miss by .40. or 15.5%. REGN will probably fall by $60 instead of $25.
After the market close, PCYC reports earnings which beats expectation. Imbruvica product sales for Q3 is 141.6M vs 5.9M(4.9 M for US &1 M from EU) for Zydelig from GILD
GILD is holding well.
The floor of 103 is for this week only based on yesterday's data. It could go lower next week. A safer bet may be 93. Still mortgage your house to buy stock is always a bad idea. You don't want to live on the street like those homeless people, do you?