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The Relevance Of Gilead's Dividend

Gilead Sciences (GILD) reported earnings on February 3. One surprise was that the company intends to initiate a dividend with a first quarterly payment of $0.43 beginning in the second quarter of 2015. At an annualized rate of $1.72, Gilead's yield stands at 1.7% and approximately $2.7B will be distributed. Gilead also announced that the Board of Directors approved the repurchase of up to an additional $15B of the company's stock.

There is not need to re-iterate the 2014 figures and to discuss the market reaction after the results were published. I will outline my take on Gilead and the general framework in the HCV space as they determine Gilead's fate. Although the company has a diversified product portfolio and a promising pipeline, the sofosbuvir based products Solvadi and Harvoni will continue to dominate.

An estimated 150-200 million people worldwide are infected with various types of hepatitis C (HCV). Gilead… Read More …