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Friday, December 25, 2015

Recent Transfer: Gilead Sciences, Inc.

Gilead Sciences, Inc (NASDAQ:GILD) is a research-based biopharmaceutical company that discovers, develops and commercializes innovative medicines. The company’s primary areas of focus include human immunodeficiency virus, liver diseases such as chronic hepatitis C virus infection and chronic hepatitis B virus infection, oncology and inflammation, and serious cardiovascular and respiratory conditions. GILD markets its products through commercial teams and in conjunction with third-party distributors and corporate partners. The company was founded in 1987 and is headquartered in Foster City, California.

GILD only recently started paying dividends. So far, the company has paid 3 quarterly dividends of 43¢ per share. At the current price of about $103.58, the stock yields 1.66%.

GILD is the 11th stock I'm transferring from my portfolio at Scottrade to DivGro.

So far, I've transferred Coca Cola (NYSE:KO), Proctor & Gamble (NYSE:PG), Kimberly-Clark (NYSE:KMB), AbbView (NYSE:ABBV), Dominion Resources (NYSE:D), W.P. Carey (NYSE:WPC), Toronto-Dominion Bank (NYSE:TD), Pfizer (NYSE:PFE), Texas Instruments (NASDAQ:TXN) and Union Pacific (NYSE:UNP).

In the process, I've added $936.93 to DivGro's projected annual dividend income and $1,326.94 in past dividends to DivGro's total dividend tally.

2015-08-17 Bought: 22 shares of GILD at $116.48 per share: $ 2,562.52
2015-09-29 Dividend on 22 shares at 43¢ per share:  $ 9.46
 Total Capital Invested $ 2,562.52

Total Dividends Received:$ 9.46

With this transfer, DivGro's projected annual dividend income increases by $37.84.

The following chart shows a 1-year history of GILD's share price and indicates when I bought shares.
So far, GILD has not performed well for me, as shares are down almost 11% since buying shares.

Source: Scottrade


Here are some reasons I like GILD and why I decided to transfer the shares to DivGro:
  1. Morningstar has a fair value estimate of $128 per share, which implies an upside of about 24%!
  2. The company's 5-year earnings per share (EPS) growth is 39%, which bodes well for future dividend growth. 
  3. GILD has a cash stockpile of more than $14 billion
  4. The company has a stellar track record of buying smaller, clinical-stage biotech and biopharma companies. 
  5. In January 2015 GILD authorized a $15 billion share repurchase program, of which $11.1 billion in authorization remained at the end of September 2015. Share repurchases lead to an increase in EPS in future financial periods, since earnings will be distributed among fewer shares. 
Do you own shares of GILD? With no record of dividend growth, but fantastic EPS growth, do you think GILD is a good dividend growth prospect? Please share your comments below.


  1. One of my favorite companies. Skies the limit with GILD. Nice job Ferdi.

    1. I'm excited about GILD. I'm looking into investing in a few stronger growth companies, and it looks like GILD may fit the bill!


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