Decent Value Stocks. Analyze the stocks with a good fundamental valuation, while still showing decent profitability, health and growth.


GILEAD SCIENCES INC

Nasdaq / Health Care / Biotechnology

Fundamental Rating

6

GILD gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 562 industry peers in the Biotechnology industry. GILD has an excellent profitability rating, but there are some minor concerns on its financial health. GILD is valued quite cheap, while showing a decent growth score. This is a good combination! This makes GILD very considerable for value investing!


Dividend Valuation Growth Profitability Health

8

1. Profitability

1.1 Basic Checks

GILD had positive earnings in the past year.
GILD had a positive operating cash flow in the past year.
In the past 5 years GILD has always been profitable.
In the past 5 years GILD always reported a positive cash flow from operatings.
GILD Yearly Net Income VS EBIT VS OCF VS FCFGILD Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

1.2 Ratios

Looking at the Return On Assets, with a value of 10.57%, GILD belongs to the top of the industry, outperforming 95.20% of the companies in the same industry.
Looking at the Return On Equity, with a value of 31.13%, GILD belongs to the top of the industry, outperforming 98.22% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 18.81%, GILD belongs to the top of the industry, outperforming 97.69% of the companies in the same industry.
GILD had an Average Return On Invested Capital over the past 3 years of 15.57%. This is in line with the industry average of 14.31%.
The 3 year average ROIC (15.57%) for GILD is below the current ROIC(18.81%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 10.57%
ROE 31.13%
ROIC 18.81%
ROA(3y)5.73%
ROA(5y)5.31%
ROE(3y)16.3%
ROE(5y)15.83%
ROIC(3y)15.57%
ROIC(5y)13.08%
GILD Yearly ROA, ROE, ROICGILD Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20 40 60 80

1.3 Margins

GILD's Profit Margin of 20.76% is amongst the best of the industry. GILD outperforms 96.26% of its industry peers.
GILD's Profit Margin has declined in the last couple of years.
GILD's Operating Margin of 38.17% is amongst the best of the industry. GILD outperforms 99.11% of its industry peers.
In the last couple of years the Operating Margin of GILD has grown nicely.
The Gross Margin of GILD (78.29%) is better than 83.81% of its industry peers.
GILD's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 38.17%
PM (TTM) 20.76%
GM 78.29%
OM growth 3Y1.21%
OM growth 5Y13.65%
PM growth 3Y-58.16%
PM growth 5Y-41.32%
GM growth 3Y1.06%
GM growth 5Y-0.23%
GILD Yearly Profit, Operating, Gross MarginsGILD Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20 40 60 80

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5

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), GILD is creating value.
The number of shares outstanding for GILD remains at a similar level compared to 1 year ago.
The number of shares outstanding for GILD has been reduced compared to 5 years ago.
Compared to 1 year ago, GILD has a worse debt to assets ratio.
GILD Yearly Shares OutstandingGILD Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B
GILD Yearly Total Debt VS Total AssetsGILD Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20B 40B 60B

2.2 Solvency

An Altman-Z score of 3.49 indicates that GILD is not in any danger for bankruptcy at the moment.
GILD's Altman-Z score of 3.49 is fine compared to the rest of the industry. GILD outperforms 77.94% of its industry peers.
GILD has a debt to FCF ratio of 2.53. This is a good value and a sign of high solvency as GILD would need 2.53 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 2.53, GILD belongs to the best of the industry, outperforming 94.48% of the companies in the same industry.
A Debt/Equity ratio of 1.16 is on the high side and indicates that GILD has dependencies on debt financing.
The Debt to Equity ratio of GILD (1.16) is worse than 79.00% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.16
Debt/FCF 2.53
Altman-Z 3.49
ROIC/WACC1.98
WACC9.5%
GILD Yearly LT Debt VS Equity VS FCFGILD Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B

2.3 Liquidity

GILD has a Current Ratio of 1.37. This is a normal value and indicates that GILD is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of GILD (1.37) is worse than 84.16% of its industry peers.
GILD has a Quick Ratio of 1.23. This is a normal value and indicates that GILD is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of GILD (1.23) is worse than 84.34% of its industry peers.
Industry RankSector Rank
Current Ratio 1.37
Quick Ratio 1.23
GILD Yearly Current Assets VS Current LiabilitesGILD Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B

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4

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 77.93% over the past year.
GILD shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.01% yearly.
The Revenue has been growing slightly by 4.68% in the past year.
GILD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.08% yearly.
EPS 1Y (TTM)77.93%
EPS 3Y-14.17%
EPS 5Y-7.01%
EPS Q2Q%237.12%
Revenue 1Y (TTM)4.68%
Revenue growth 3Y1.74%
Revenue growth 5Y5.08%
Sales Q2Q%-0.28%

3.2 Future

Based on estimates for the next years, GILD will show a quite strong growth in Earnings Per Share. The EPS will grow by 17.07% on average per year.
The Revenue is expected to grow by 3.46% on average over the next years.
EPS Next Y75.86%
EPS Next 2Y36.32%
EPS Next 3Y25.4%
EPS Next 5Y17.07%
Revenue Next Year1.08%
Revenue Next 2Y2.38%
Revenue Next 3Y3.27%
Revenue Next 5Y3.46%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
GILD Yearly Revenue VS EstimatesGILD Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 10B 20B 30B
GILD Yearly EPS VS EstimatesGILD Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2 4 6 8 10

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8

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 12.74 indicates a correct valuation of GILD.
96.26% of the companies in the same industry are more expensive than GILD, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 24.85, GILD is valued a bit cheaper.
The Price/Forward Earnings ratio is 11.52, which indicates a very decent valuation of GILD.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GILD indicates a rather cheap valuation: GILD is cheaper than 95.73% of the companies listed in the same industry.
GILD is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.89, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 12.74
Fwd PE 11.52
GILD Price Earnings VS Forward Price EarningsGILD Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GILD indicates a rather cheap valuation: GILD is cheaper than 96.62% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GILD indicates a rather cheap valuation: GILD is cheaper than 96.80% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 12.48
EV/EBITDA 10.15
GILD Per share dataGILD EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10 15 20

4.3 Compensation for Growth

GILD's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of GILD may justify a higher PE ratio.
GILD's earnings are expected to grow with 25.40% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.17
PEG (5Y)N/A
EPS Next 2Y36.32%
EPS Next 3Y25.4%

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6

5. Dividend

5.1 Amount

GILD has a Yearly Dividend Yield of 3.22%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 93.64, GILD pays a better dividend. On top of this GILD pays more dividend than 98.75% of the companies listed in the same industry.
GILD's Dividend Yield is a higher than the S&P500 average which is at 2.40.
Industry RankSector Rank
Dividend Yield 3.22%

5.2 History

The dividend of GILD has a limited annual growth rate of 4.45%.
GILD has paid a dividend for at least 10 years, which is a reliable track record.
As GILD did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)4.45%
Div Incr Years9
Div Non Decr Years9
GILD Yearly Dividends per shareGILD Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1 2 3

5.3 Sustainability

66.02% of the earnings are spent on dividend by GILD. This is not a sustainable payout ratio.
GILD's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP66.02%
EPS Next 2Y36.32%
EPS Next 3Y25.4%
GILD Yearly Income VS Free CF VS DividendGILD Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B
GILD Dividend Payout.GILD Dividend Payout, showing the Payout Ratio.GILD Dividend Payout.PayoutRetained Earnings

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