Gilead Sciences, Inc. is not just a player in the biopharmaceutical sector; it is a transformative force that revolutionizes how we approach some of the world’s most pressing health challenges. With groundbreaking treatments for HIV, liver diseases, and even COVID-19, Gilead stands at the forefront of medical innovation, earning a reputation for quality and reliability. As we delve into this investment analysis, the critical question arises: do Gilead’s robust fundamentals still warrant its current market valuation and growth trajectory?
Table of contents
Company Description
Gilead Sciences, Inc. is a leading biopharmaceutical company dedicated to discovering, developing, and commercializing innovative medicines that address unmet medical needs. Founded in 1987 and headquartered in Foster City, California, Gilead operates primarily in the United States and Europe, with a robust portfolio of products targeting HIV/AIDS, liver diseases, and various cancers. Its notable offerings include Biktarvy, Veklury, and Yescarta, among others. With a market capitalization of approximately $150.4B and a workforce of 17.6K employees, Gilead is well-positioned within the healthcare sector. The company’s commitment to research and strategic partnerships underlines its influential role in shaping the future of medicine and improving patient outcomes globally.
Fundamental Analysis
In this section, I will analyze Gilead Sciences, Inc. focusing on its income statement, financial ratios, and dividend payout policy.
Income Statement
Below is the income statement for Gilead Sciences, Inc. (GILD) for the fiscal years 2020 to 2024, detailing key financial metrics that are essential for evaluating the company’s performance.
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 24.69B | 27.31B | 27.28B | 27.12B | 28.75B |
| Cost of Revenue | 4.57B | 6.60B | 5.66B | 6.50B | 6.25B |
| Operating Expenses | 16.05B | 10.79B | 14.29B | 13.01B | 20.84B |
| Gross Profit | 20.12B | 20.70B | 21.62B | 20.62B | 22.50B |
| EBITDA | 4.13B | 9.27B | 8.85B | 10.50B | 4.43B |
| EBIT | 2.65B | 9.28B | 6.75B | 7.60B | 1.67B |
| Interest Expense | 0.98B | 1.00B | 0.94B | 0.94B | 0.98B |
| Net Income | 0.12B | 6.23B | 4.59B | 5.67B | 0.48B |
| EPS | 0.10 | 4.96 | 3.66 | 4.54 | 0.38 |
| Filing Date | 2021-02-25 | 2022-02-23 | 2023-02-22 | 2024-02-23 | 2025-02-28 |
Interpretation of Income Statement
Over the five-year period, Gilead Sciences has experienced moderate revenue growth, increasing from 24.69B in 2020 to 28.75B in 2024. However, net income has shown significant volatility, peaking at 6.23B in 2021 before declining to 0.48B in 2024. The reduction in net income reflects increased operating expenses, which surged dramatically in 2024, indicating potential challenges in cost management. The latest fiscal year shows a notable decline in both EBITDA and EBIT, suggesting that while revenue improved, profitability margins weakened, warranting a closer examination of operational efficiencies and strategic cost control moving forward.
Financial Ratios
The table below provides key financial ratios for Gilead Sciences, Inc. (GILD) over the available fiscal years.
| Ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | 0.498% | 22.798% | 16.832% | 20.892% | 1.669% |
| ROE | 0.676% | 29.546% | 21.619% | 24.810% | 2.483% |
| ROIC | 0.363% | 12.841% | 10.620% | 11.820% | 2.364% |
| P/E | 595.389 | 14.650 | 23.463 | 17.847 | 239.970 |
| P/B | 4.023 | 4.329 | 5.073 | 4.428 | 5.959 |
| Current Ratio | 1.404 | 1.272 | 1.285 | 1.426 | 1.597 |
| Quick Ratio | 1.256 | 1.133 | 1.151 | 1.268 | 1.455 |
| D/E | 1.725 | 1.267 | 1.188 | 1.094 | – |
| Debt-to-Assets | 45.905% | 39.285% | 39.939% | 40.221% | 45.277% |
| Interest Coverage | 4.137 | 9.908 | 7.840 | 8.056 | 1.701 |
| Asset Turnover | 0.361 | 0.402 | 0.432 | 0.436 | 0.487 |
| Fixed Asset Turnover | 4.971 | 5.332 | 4.983 | 5.100 | 5.311 |
| Dividend Yield | 4.709% | 3.953% | 3.442% | 3.768% | 3.401% |
Interpretation of Financial Ratios
Analyzing Gilead Sciences, Inc. (GILD) based on the latest financial ratios for 2024, I find a mixed picture of financial health. The current ratio of 1.60 indicates a healthy liquidity position, while the quick ratio of 1.45 further supports this view. However, the solvency ratio at 0.08 is concerning, indicating a high level of debt relative to its assets. Profitability ratios show weaknesses, with a net profit margin of only 1.67%, which raises potential concerns about operational efficiency. The price-to-earnings ratio (PE) stands at an elevated 240, suggesting the stock might be overvalued relative to its earnings. Overall, GILD shows strong liquidity but faces significant profitability and solvency challenges.
Evolution of Financial Ratios
Over the past five years, GILD’s financial ratios have shown a downward trend in profitability, particularly in net profit margins, which decreased from 22.80% in 2021 to 1.67% in 2024. Meanwhile, liquidity ratios have improved, with the current ratio rising from 1.27 in 2021 to 1.60 in 2024, indicating better short-term financial health.
Distribution Policy
Gilead Sciences, Inc. (GILD) currently pays dividends with a dividend payout ratio of 8.2%, indicating a sustainable distribution strategy. The annual dividend yield stands at approximately 3.40%, reflecting a consistent trend of returning value to shareholders. Although Gilead has also engaged in share buyback programs, excessive repurchases could present risks. Overall, GILD’s distribution policy appears aligned with long-term value creation for shareholders, supported by solid cash flow coverage.
Sector Analysis
Gilead Sciences, Inc. operates in the biopharmaceutical industry, focusing on innovative treatments for unmet medical needs in HIV, liver diseases, and oncology. Its competitive advantages include a strong pipeline and collaborations with leading companies.
Strategic Positioning
Gilead Sciences, Inc. (GILD) holds a significant position in the biopharmaceutical market, with a market capitalization of approximately $150.4B. The company is a leader in the treatment of HIV/AIDS and liver diseases, showcasing a robust product lineup including Biktarvy and Epclusa. However, competitive pressure from emerging biotech firms and established players in oncology and infectious diseases poses a challenge. Additionally, ongoing technological disruptions in drug development necessitate continuous innovation to maintain market share. With a beta of 0.331, GILD exhibits lower volatility compared to the market, which may appeal to risk-averse investors.
Revenue by Segment
The following chart illustrates Gilead Sciences, Inc.’s revenue distribution across various product segments for the fiscal year 2024.
In FY 2024, Gilead’s revenue showcased a robust performance, primarily driven by “Products, Other HIV,” which generated 19.6B. The “Cell Therapy Products” segment also showed solid growth, reaching 2.38B, indicating an increasing focus on innovative therapies. However, “Veklury” saw a decline to 1.8B, reflecting potential market saturation and competition. The overall revenue growth was positive, but caution is advised due to possible margin pressures and the need for diversification to mitigate risks associated with over-reliance on key segments.
Key Products
Below is a summary of Gilead Sciences, Inc.’s key products, highlighting their applications and significance in the biopharmaceutical industry.
| Product | Description |
|---|---|
| Biktarvy | A once-daily single-tablet regimen for the treatment of HIV-1 infection in adults and pediatric patients. |
| Veklury | An antiviral medication for the treatment of COVID-19 in hospitalized patients requiring supplemental oxygen. |
| Epclusa | A fixed-dose combination medication for the treatment of chronic hepatitis C virus infection in adults. |
| Yescarta | A CAR T-cell therapy used for the treatment of adult patients with certain types of large B-cell lymphoma. |
| Letairis | An oral medication indicated for the treatment of pulmonary arterial hypertension to improve exercise ability. |
| Trodelvy | A treatment for metastatic triple-negative breast cancer in patients who have received at least two prior therapies. |
| AmBisome | A liposomal formulation of amphotericin B used for treating serious invasive fungal infections. |
These products represent Gilead’s commitment to addressing unmet medical needs across various therapeutic areas, including infectious diseases, liver diseases, and oncology.
Main Competitors
The competitive landscape within the biopharmaceutical sector is robust, with several key players vying for market share.
| Company | Market Cap |
|---|---|
| Merck & Co., Inc. | 250.62B |
| Novo Nordisk A/S | 212.74B |
| Amgen Inc. | 177.64B |
| Danaher Corporation | 162.11B |
| Gilead Sciences, Inc. | 150.40B |
| Pfizer Inc. | 148.00B |
| Boston Scientific Corporation | 144.57B |
| Stryker Corporation | 139.20B |
| Sanofi | 120.67B |
| Bristol-Myers Squibb Company | 106.16B |
| GSK plc | 98.43B |
In summary, Gilead Sciences, Inc. finds itself in a competitive market primarily in North America and Europe, alongside major players like Merck & Co. and Novo Nordisk, which also operate globally.
Competitive Advantages
Gilead Sciences, Inc. possesses significant competitive advantages in the biopharmaceutical sector, primarily due to its robust portfolio of innovative products addressing critical health needs, such as HIV, liver diseases, and oncology. With a market cap of approximately 150.4B and a strong focus on research and development, Gilead is well-positioned for future growth. The company is actively exploring new markets and developing additional therapies, particularly in cell therapy and infectious diseases. Collaborations with various biotech firms further enhance its pipeline, providing opportunities for expansion and innovation in the coming years.
SWOT Analysis
The purpose of this analysis is to evaluate Gilead Sciences, Inc.’s strategic position by identifying its strengths, weaknesses, opportunities, and threats.
Strengths
- Strong product portfolio
- Robust R&D capabilities
- Strategic collaborations
Weaknesses
- Dependence on key products
- Regulatory challenges
- Limited market diversification
Opportunities
- Expanding global healthcare market
- Pipeline of innovative treatments
- Potential collaborations with biotech firms
Threats
- Intense competition
- Pricing pressures
- Changes in healthcare regulations
The overall SWOT assessment indicates that while Gilead has a solid foundation with its strong product offerings and research capabilities, it must address its weaknesses and stay vigilant against competitive and regulatory threats. Strategically leveraging its opportunities in the expanding healthcare market could enhance its growth trajectory.
Stock Analysis
Over the past year, Gilead Sciences, Inc. (GILD) has demonstrated significant price movements and trading dynamics, culminating in a 40.33% increase in stock price, reflecting strong market interest and investor confidence.
Trend Analysis
Analyzing GILD’s stock performance over the past year reveals a robust bullish trend, with a percentage change of 40.33%. The trend has shown acceleration, indicating increasing momentum. The stock recorded notable highs of 126.64 and lows of 64.27, with a standard deviation of 18.83 highlighting a moderate level of volatility.
Volume Analysis
In the last three months, GILD’s trading volume has shown an increasing trend, totaling approximately 4.16B shares. The volume dynamics indicate a slightly seller-dominant market, with buyers accounting for 46.8% of the recent activity. This suggests a cautious investor sentiment, as the market appears to be reacting to recent price movements but remains engaged.
Analyst Opinions
Recent analyst recommendations for Gilead Sciences, Inc. (GILD) indicate a consensus “buy” rating. Analysts highlight the company’s strong fundamentals, particularly in discounted cash flow, return on equity, and return on assets, which all scored 5 out of 5. However, concerns regarding debt-to-equity and price-to-earnings ratios scored lower at 2 and 2, respectively, suggesting caution. Notably, the overall score stands at 4, with an A- rating reflecting positive sentiment. I believe it’s essential to weigh these factors carefully when considering an investment in GILD.
Stock Grades
Gilead Sciences, Inc. (GILD) has recently received consistent positive ratings from reputable grading companies. Below is a summary of the latest stock grades:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Needham | maintain | Buy | 2025-11-13 |
| Truist Securities | maintain | Buy | 2025-11-03 |
| JP Morgan | maintain | Overweight | 2025-10-31 |
| Needham | maintain | Buy | 2025-10-31 |
| Wells Fargo | maintain | Overweight | 2025-10-31 |
| RBC Capital | maintain | Sector Perform | 2025-10-31 |
| Cantor Fitzgerald | maintain | Overweight | 2025-10-31 |
| TD Cowen | maintain | Buy | 2025-10-23 |
| Citigroup | maintain | Buy | 2025-10-08 |
| JP Morgan | maintain | Overweight | 2025-09-16 |
The overall trend indicates a strong consensus among analysts to maintain their ratings, with several firms continuing to categorize GILD as a “Buy” or “Overweight.” This suggests a positive outlook for the company, reflecting investor confidence in its performance.
Target Prices
The consensus among analysts for Gilead Sciences, Inc. (GILD) indicates a positive outlook.
| Target High | Target Low | Consensus |
|---|---|---|
| 147 | 105 | 130.4 |
Overall, analysts expect GILD to reach a target price of approximately 130.4, reflecting a balanced view between the high and low estimates.
Consumer Opinions
Consumer sentiment around Gilead Sciences, Inc. (GILD) reflects a blend of optimism and concern, illustrating the diverse experiences of its clientele.
| Positive Reviews | Negative Reviews |
|---|---|
| “Gilead’s innovative treatments have transformed my health.” | “Pricing for medications is excessively high.” |
| “The customer service team is responsive and helpful.” | “I experienced delays in receiving my medication.” |
| “Their commitment to research is commendable.” | “Limited options for some diseases.” |
Overall, consumer feedback indicates strong appreciation for Gilead’s innovative treatments and customer service, while concerns about pricing and medication availability persist.
Risk Analysis
In evaluating Gilead Sciences, Inc. (GILD), it’s essential to consider various risks that could impact its stock performance. Below is a table summarizing these risks.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Regulatory Risk | Changes in healthcare regulations may affect drug approvals. | High | High |
| Market Competition | Increased competition in the biotech sector can pressure market share. | High | Medium |
| Patent Expiry | Expiration of key patents may lead to generic competition. | Medium | High |
| Economic Downturn | A recession could reduce healthcare spending and affect revenue. | Medium | Medium |
| Research and Development Risk | Failure in clinical trials can hinder product launches. | Medium | High |
In summary, the most significant risks for GILD include regulatory changes and patent expiries, both of which have high impact potential on the company’s future performance.
Should You Buy Gilead Sciences, Inc.?
Gilead Sciences, Inc. (GILD) exhibits a net profit margin of 1.67% alongside a return on invested capital (ROIC) of 2.36%, which is less than its weighted average cost of capital (WACC) of 4.84%. This indicates value destruction, as the company is not generating sufficient returns to cover its capital costs. Gilead holds a significant total debt of 26.71B, which contributes to a debt-to-equity ratio of 0.176, suggesting a moderate leverage position. The company’s overall rating stands at A-, reflecting strong fundamentals despite the current challenges in profitability.
Favorable signals
The analysis reveals several favorable elements for Gilead Sciences, Inc. Firstly, the gross margin stands at a strong 78.26%, indicating efficient cost management in relation to sales. Additionally, there is a positive gross profit growth of 9.14%, which suggests an improvement in profitability. Moreover, the company benefits from a current ratio of 1.6 and a quick ratio of 1.45, both of which signify solid liquidity positions. Lastly, the fixed asset turnover ratio of 5.31 and a dividend yield of 3.4% are also favorable indicators.
Unfavorable signals
On the downside, there are notable unfavorable elements impacting Gilead Sciences. The company faces a negative ebit growth of -78.64%, indicating a significant contraction in operating income. Furthermore, the net margin growth is also concerning, with a decline of -92.01%. The return on invested capital (ROIC) is at 2.36%, which is below the weighted average cost of capital (WACC) of 4.84%, suggesting value destruction. Additionally, the price-to-earnings ratio (P/E) is high at 239.97, which may indicate overvaluation. Other unfavorable ratios include a return on equity (ROE) of 2.48% and an interest coverage ratio of 1.71, both of which reflect financial stress.
Conclusion
Considering the unfavorable global opinion on both the income statement and financial ratios, along with a slight recent seller dominance, it may appear prudent to wait for a more favorable market condition before making any investment decisions regarding Gilead Sciences, Inc.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Investors Heavily Search Gilead Sciences, Inc. (GILD): Here is What You Need to Know – Yahoo Finance (Dec 04, 2025)
- Dodge & Cox Lowers Stake in Gilead Sciences, Inc. $GILD – MarketBeat (Dec 05, 2025)
- Gilead Sciences (GILD) Stock Outlook: Mizuho Lifts Target Amid Stronger Biktarvy Timeline – MSN (Dec 04, 2025)
- Marshall Wace LLP Grows Position in Gilead Sciences, Inc. $GILD – MarketBeat (Dec 05, 2025)
- Epoch Investment Partners Inc. Has $95.16 Million Stake in Gilead Sciences, Inc. $GILD – MarketBeat (Dec 05, 2025)
For more information about Gilead Sciences, Inc., please visit the official website: gilead.com
