Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : All Industries Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Augustus Gloop who wrote (13151)	4/17/2013 3:25:34 AM
From: Augustus Gloop	Respond to of 13719

GILD was another stock I almost posted here. I didn't because I don't have a feel for what the risk appetite is for people on this thread so I posted it on JP's thread Message 28810138 Gilead Sciences (GILD) finance.yahoo.com The Company / basics - Gilead Sciences (GILD). On a chart it's in the nose bleed section* It's up over 100% in a year. Sector - Biotech Niche - Hep C and HIV Projected Earnings growth over the next 5 = 20% PE = 29 Beta = .80 Divi = 0 *The Chart - I watch sticks but I mainly watch P&F. There are people far more sophisticated than I am who can analyze a different chart and provide a better, more logical entry point than my 40-42. Mine is simply a hope to see a reasonable PB without breaking a long term P&F chart. The longer term P&F chart - stockcharts.com For longer term I use a percentage chart and use 1.67 for box size. Doing this adjusts the box automatically rather than waiting for a stock to hit a certain price to enlarge the box. GILD is in a triple top breakout formation. These are good formations that suggest a high probability for upside but that doesn't mean we cant see a handsome PB first Traditional P&F - stockcharts.com This style simply uses $1.00 as its box size because the stock is over 20. GILD is in a long tail up formation. A long tail up can go on for a long time but it also suggests the stock is potentially ready for a PB. Moreover, it's harder to see of find a support point or max pain stop. It makes GILD look like it's been straight up when in fact the stock spent 7 months churning between roughly 22 and 28 last year. There was another 4 month stint between spent 30 and 38. These area's can bee seen by looking at the longer term P&F chart link. Turn ons - GILD is in the right sector GILD Has the momentum and drug pipeline to reach 60-70 per share. GILD has the earnings growth (provided they hit targets) to justify 70 GILD has been and has the potential to continue to be a high growth stock with a reasonable beta (.80) GILD has done well hitting its earnings projections Turn offs - The market needs a correction imo The biotech run reminds of the biotech run of the early to mid 90's which means be choose wisely because runs like this don't last forever The P/E is a little rich. You're paying a premium (today) for the high growth potential No Dividend but like the P/E - it's a trade off for buying high growth potential Basic Strategy - As mentioned, I'd like to see a PB in the stock to 40-42 range. Since I don't know if that will happen, the method I like to use for entry is scaling. I'm sure everyone on this thread knows what scaling is but if not - it's different than dollar cost averaging and I can post an outline later when I've got more time. If you're reading this and want me to do a scaling explained* post just give me the word *I only use scaling when I view a stock as a long term position that I'm going to own as part of my portfolio foundation.