Gilead Sciences (NASDAQ: GILD – $62.98) posted third-quarter results largely in line with Wall Street estimates. The Foster City, Calif.-based company, which has operations in more than 35 countries worldwide, generated revenue of $5.604 billion in the third quarter, fractionally ahead of the $5.596 billion registered in the prior-year period and just shy of the consensus estimate of $5.61 billion. Product sales came in at $5.52 billion, up from $5.46 billion a year earlier. Royalty, contract and other revenue meanwhile amounted to $88 million, down from $141 million. Segmented by individual treatment, HIV product sales totaled $4.2 billion, up from $3.7 billion. The company said that the increase was primarily driven by higher sales volume as a result of the continued uptake of Biktarvy. Sales of chronic hepatitis C virus products settled at $674 million, compared to $902 million a year earlier, attributing the decline primarily to competitive dynamics. Yescarta, a therapy for adults living with certain types of non-Hodgkins lymphoma, generated $118 million in sales compared to $75 million. Other product sales accounted for $522 million compared with $751 million last year, primarily due a decline in sales of Ranexa. Adjusted earnings per share came in at $1.75, down from $1.84 a year earlier but were still ahead of analysts’ forecasts for $1.74.
For the full year, the company is now targeting product sales of $21.8 billion to $22.1 billion, up from guidance issued in July for $21.6 billion to $22.1 billion. The company reiterated its full-year earnings per share guidance of $3.90 to $4.00 which values GILD at a reasonable 16 times earnings. The company also maintained its fourth quarter dividend at $0.63 per share, which yields 3.8%. The shares are not without risk, but can continue to be considered for long-term recovery on the prospects of acquisitions (with $27 billion in cash available) and an improved drug pipeline.