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Open Thread: What Are You Buying/Selling/Pondering
Thanks for the years of links Ted. Glad you're set and thanks for keeping the links coming!
I might buy some GILD. GILD's blowout earnings and raised forecast could bode well for the entire biotech sector, which is in need of good news the kind of which GILD brought today.
@PopTart- "I might buy some GILD". Just so you know, I'm thinking the same thing. That probably means that you should seriously think about shorting GILD.
The resilience of the open end junk corporates has surprised me this week. I sold some (put 15% in bank loan) but may have to go right back in if necessary. My problem with HFRZX is besides its underperformance this year is that its two largest holdings are commons stocks. So how they go may dictate the fund's performance. Good luck.
@PopTart- "I might buy some GILD". Just so you know, I'm thinking the same thing. That probably means that you should seriously think about shorting GILD.
It remains a very large position for me, which is why it will probably go down again. Still, the dividends now start for GILD and I'll be happy to collect.
I mean that was a monster quarter and only makes - in my opinion - GILD seem more undervalued.
Again though, now there's a dividend so now I can have a greater degree of patience. Plus there's a huge buyback.
It's not without risk, certainly - but I think Gilead has priced in a lot of that.
Also, for those looking at floating rate, the majority of STWD's loans are floating rate and the company has discussed how it will benefit if rates rise. It will probably be thrown out with anything else real estate if things rise at first as people sell and ask questions later, but the underlying business will actually see a benefit.
" At the same time, 77% of Starwood's lending portfolio is tied up in LIBOR-based floating rate loans. Floating rates allow Starwood to act appropriately when rates do move, and the company is not left scrambling to cover hedges or losses."
The portfolio is constructed to benefit from rising rates.
Good morning. Not much change previously still 85/15 with 401k. Bought ngr and couple of oil and bank bonds the past few weeks. Although i think we maybe heading toward a slow down the next quater or two. Btw congratz ted but imho tex does not need a fa but indeed need tax advisor due to massive incomes. Kind regards
@Scott- thanks for your ongoing reporting re GILD. Also, I appreciate our ability to keep investing discussions completely separate from our other areas of discussion, as interesting as those may be.
@Scott- thanks for your ongoing reporting re GILD. Also, I appreciate our ability to keep investing discussions completely separate from our other areas of discussion, as interesting as those may be.
Absolutely agree and am happy to help.
As for GILD, it has ultimately been a frustrating stock, but personally once the dividend was announced that allowed me to be more patient.
Basically, you have a stock with a forward p/e in the teens. As noted in a Seekingalpha article this morning, it made more this quarter than it did in all of 2013.
The company bought Pharmasset a few years ago for $11B and people thought it was too expensive. They then went on to dominate the Hep-C market with Harvoni and Solvaldi. People were upset with the $11B purchase, but: "Sovaldi is the first antidote to the hepatitis C virus, boasting a 90% cure rate. During the first three quarters of 2014, the drug generated sales of more than $8.5 billion" (http://www.fastcompany.com/3041565/most-innovative-companies-2015/how-drug-company-gilead-outpaces-its-competitors-and-common-d)
I mean, Harvoni alone was $3.6B this quarter (which in and of itself was a big beat of estimates), plus they raised guidance on product sales.
That fast company article is actually a terrific in-depth look at the company.
People are understandably upset at the price of Gilead's treatments and the drugs have been the poster children for upset over drug prices. That said, what is the cost and what are the complications of a liver transplant?
I mean, from the FC article: "Former military technician and Lockheed Martin avionics specialist Gavin West, 59, spent a year on interferon and other drugs in 2006. "It was the most excruciating, miserable experience of my life," he says. Fatigue and cognitive impairment from hepatitis C had forced him to leave his job. The drug cocktail actually made him worse, and two months after he finished the regimen, the virus came back. "They told me, ‘Hang in there,’ " West says. "I was just waiting to die."
He remembers getting the call from his physician’s office about Harvoni. "I went in and there was one pill," West says. He took it and waited for the nausea, headache, and muscle pain. Nothing. He felt better, and when he went to refill the bottle, the clinician told him he was done. "I felt like crying," he says. A little over a year later, he remains free of the disease."
There has been a lot of concern over competition, but Abbvie's viekira pak has not been the competition that people have predicted. Merck is also entering the fray, but they're doing so after Gilead has had a significant head start.
Gilead's HIV drugs are also going to find more and more competition. That said, the company has "grown sales from $1.32 billion in 2004 to an estimated $24.3 billion in 2014. That's a compound annual growth rate of 33.8%." The company is generating enormous amounts of free cash flow. It also certainly has a solid pipeline.
I absolutely say that there are real risks, as there is in any sort of biotech. You have a company that is not broadly focused and a lot of revenue comes from HIV/Hep-C. Despite the fact that I think these pills are cheaper and less risky than a liver transplant, there could be continued pushback over high prices for treatments like this.
You could have people continue to be skittish over their views of a bubble in biotech and ETF selling could drag the sector down.
Again though, the thing is trading at a p/e in the low teens, which I think not only takes a lot of risks into account already, but undervalues the pipeline the company does have. The company could also certainly make a big purchase again.
With the dividend, I can see it being a comfortable long-term holding and with the valuation being what it is, I think it's actually a good value in a market where values are increasingly rare.
There are certainly risks, but again, I'm happy to collect the dividend and sit on it with valuations being what they are and management having accomplished what they have.
But, it is what it is. I'd be pleasantly surprised if it headed consistently higher from here, but would be fine with $100 at least now being a very solid floor.
Additionally, I also find Celgene and its immense number of collaborations very interesting, but that's not a particularly cheap stock. Still, I think it has a bright future, as well.
GILD has been the single most frustrating stock that I've been watching. Today might just be a short term bounce for GILD. Harvoni should be available in Japan in the 2nd half of this year as well as in various European countries where it's not yet available. But at what price?
There is no "real" competition for GILD's one pill regimen for consistently curing Hep. C. GILD owns the Hep. C space. As Scott mentioned, the dividend will allow shareholders to be patient and watch GILD (hopefully) slowly grind higher after today. GILD's cash horde also presents a variety of M&A opportunities.
Decided to sell ARII today. I had bought it last year averaging $62, sold at $80. Rebought it this year at 56 and although it had a blow out quarter and climber 12% over the last two days, I was sitting at even this time around, and figured lightening may not strike two times in a row since rail transports most likely not to see dramatic gains any time soon. Keeping it in cash for now and will add it to tech later on when prices come down a bit.
On GILD, also keep in mind the huge buyback program - $5B last quarter at an average of $102.36 (reduction of 26% of float); with approval for $15B additional buyback.
Decided to sell ARII today. I had bought it last year averaging $62, sold at $80. Rebought it this year at 56 and although it had a blow out quarter and climber 12% over the last two days, I was sitting at even this time around, and figured lightening may not strike two times in a row since rail transports most likely not to see dramatic gains any time soon. Keeping it in cash for now and will add it to tech later on when prices come down a bit.
On GILD, also keep in mind the huge buyback program - $5B last quarter at an average of $102.36 (reduction of 26% of float); with approval for $15B additional buyback.
Yep, very nice buyback will also hopefully put a floor under the stock.
@scott: thats because I sold it : / Whenever I sell a stock, it goes up or news comes out that gives it a bump. Since I made money on it once, I guess that will have to be enough. My trading stocks are a very small portion, I like them I think its because its a challenge. One bright spot, I have a small cap fund that has Trinity in top 5, TRN should benefit too.
Sometime my trading stocks turn into longer term holds, such as my position in WWAV.
I'm thinking about buying a floating rate bond fund but I prefer something not too aggressive as I saw what happened during 2008. I'm looking for something with decent yield that will offset some of my bond funds that are more interest rate sensitive. Currently, I own PIMIX, DODIX, MWTRX, MITFX and BSBIX, to name a few.
@slick: check out TRN in the New York Times archive. They are trying to soften up states attorneys general in the light of coming litigation due to their highway guardrail fiasco. I have a couple of small cap funds that reported holding TRN last quarter. The managers won't tell me if they sold. Don't they know who I am? LOL
No need for capital appreciation? No need for dividends? No need to protect against inflation?
How cool is that?
Along with the other members, congratulations!
Following the steps of Alan Greenspan, sounds like.
Very much appreciate your guidance...please keep it coming.
Break, break.
Hi Scott.
No changes since last post.
Man, I'm starting to sound like a buy-and-holder!
Very good today...AA bounced back...as did BAC (Great Pumpkin #2).
AIG has been on a tear lately.
And HCP stopped falling for a change. I understand its situation (I think), but hard to complain given its dividend.
FAAFX (Great Pumpkin #1) had good day......thank you David for hopeful words in your commentary.
Two past holdings remain on watch list: SCHN seems to be getting some love finally...bottomed (perhaps) near $15...back up to $17; GE too, but I think it was not able to maintain recent highs...back under $27 again, or close.
Here in central coast I see most private construction since the dark times. Town homes. New homes. Hotels. New tasting rooms, beautifully designed, and cellars at the wineries. Hey, a "Sold" sign went up today for a nearby home that recently went on market.
So Ted, I feel like you...encouraged.
Fingers-crossed.
If the world can avoid doing something stupid for a while, perhaps our bull has legs.
@BenWP: thanks for the heads up on TRN . I have HDPSX which has a chunk of it in top 10. If I had seen the news about the new regs before I sold arii thisam might not have sold, just raised the stop.
Not adding to stocks. Too much happy story; I don't feel it, and I don't see it. May take the entire summer to play out (or, maybe not), to find out if I'm mistaken (or, maybe not). Incremental investing in EM bond funds, more so with those which had local currency during last Fall's panic and are still recovering. Still think there's value there (with the understanding there's a bunch of things that could occur and send EM down again). I don't trust the corp junk picture--- nothing seems to affect them, nothing, it's weird--- so only doing "Krug feeding" at ARTFX (1st yr record just completed; near top of list, as expected).
@heezsafe, I have been seeing the same thing with REITs as of late. Early this year I sold half of my global real estate fund. Yesterday I sold the rest. The proceeds went into EM and International funds. I would guess the eventual rate increase by the Fed is part of the issue. From what I can see in Asia, real estate prices continue to climb and the bubble word is mentioned often. Australia real estate is getting very pricey, especially in Sydney and Melbourne. China property prices keep going up and up. Singapore is the same despite govt attempts to cool the market. In fact, Chinese feel their property prices are too high and are buying real estate everywhere else which fuels those markets.
That's the only view I have but I have been getting the impression that it's all due for a blowoff.
Cash sitting in wasted spaces...Don't know if I could harbor those thoughts... Morgan Stanley will be pushing Annuities, big cash deposits with them ect, anything they can made money on....be Careful... But to each his own...when is enough enough?...good Question... "My money has to work because I don't" ....Tampabay
Hi Scott! I like this thread. It's my favorite next to David's commentary. One can find out what other people are thinking just reading this thread, I think. That's great. Sorry to be late again but it's the work thing.....we're busy right now. Have sold the S&P. I'm putting money in FMIJX, DoDFX, RERFX, and will add some to healthcare, as it's pulled back some. Bought TMSFX some time ago, and all I can say (OUCH!).....will buy more now, though. Had bought FSENX in January. Made some good returns there.....averaged over 11% return. I still think oil has more to go. My MLP's are up....that's really nice for a change....with oil and healthcare the two (2) biggest drivers. In the port, things are looking better now. Right now I'm up over 5% for the year. I'm sure many of you have that beat, but I'm happy with that. God bless. the Pudd
Comments
Yeah, he's always been a bit on the shy side, but now...
I might buy some GILD. GILD's blowout earnings and raised forecast could bode well for the entire biotech sector, which is in need of good news the kind of which GILD brought today.
I mean that was a monster quarter and only makes - in my opinion - GILD seem more undervalued.
Again though, now there's a dividend so now I can have a greater degree of patience. Plus there's a huge buyback.
It's not without risk, certainly - but I think Gilead has priced in a lot of that.
Also, for those looking at floating rate, the majority of STWD's loans are floating rate and the company has discussed how it will benefit if rates rise. It will probably be thrown out with anything else real estate if things rise at first as people sell and ask questions later, but the underlying business will actually see a benefit.
http://seekingalpha.com/article/3120806-shield-yourself-from-rising-rates-with-starwood
" At the same time, 77% of Starwood's lending portfolio is tied up in LIBOR-based floating rate loans. Floating rates allow Starwood to act appropriately when rates do move, and the company is not left scrambling to cover hedges or losses."
The portfolio is constructed to benefit from rising rates.
Investor day presentation:
http://ir.starwoodpropertytrust.com/Cache/1001196685.PDF?Y=&O=PDF&D=&FID=1001196685&T=&IID=4235133
Earnings sensitivity to changes in LIBOR is on page 55.
Not much change previously still 85/15 with 401k. Bought ngr and couple of oil and bank bonds the past few weeks. Although i think we maybe heading toward a slow down the next quater or two. Btw congratz ted but imho tex does not need a fa but indeed need tax advisor due to massive incomes.
Kind regards
As for GILD, it has ultimately been a frustrating stock, but personally once the dividend was announced that allowed me to be more patient.
Basically, you have a stock with a forward p/e in the teens. As noted in a Seekingalpha article this morning, it made more this quarter than it did in all of 2013.
The company bought Pharmasset a few years ago for $11B and people thought it was too expensive. They then went on to dominate the Hep-C market with Harvoni and Solvaldi. People were upset with the $11B purchase, but: "Sovaldi is the first antidote to the hepatitis C virus, boasting a 90% cure rate. During the first three quarters of 2014, the drug generated sales of more than $8.5 billion" (http://www.fastcompany.com/3041565/most-innovative-companies-2015/how-drug-company-gilead-outpaces-its-competitors-and-common-d)
I mean, Harvoni alone was $3.6B this quarter (which in and of itself was a big beat of estimates), plus they raised guidance on product sales.
That fast company article is actually a terrific in-depth look at the company.
People are understandably upset at the price of Gilead's treatments and the drugs have been the poster children for upset over drug prices. That said, what is the cost and what are the complications of a liver transplant?
I mean, from the FC article: "Former military technician and Lockheed Martin avionics specialist Gavin West, 59, spent a year on interferon and other drugs in 2006. "It was the most excruciating, miserable experience of my life," he says. Fatigue and cognitive impairment from hepatitis C had forced him to leave his job. The drug cocktail actually made him worse, and two months after he finished the regimen, the virus came back. "They told me, ‘Hang in there,’ " West says. "I was just waiting to die."
He remembers getting the call from his physician’s office about Harvoni. "I went in and there was one pill," West says. He took it and waited for the nausea, headache, and muscle pain. Nothing. He felt better, and when he went to refill the bottle, the clinician told him he was done. "I felt like crying," he says. A little over a year later, he remains free of the disease."
There has been a lot of concern over competition, but Abbvie's viekira pak has not been the competition that people have predicted. Merck is also entering the fray, but they're doing so after Gilead has had a significant head start.
Gilead's HIV drugs are also going to find more and more competition. That said, the company has "grown sales from $1.32 billion in 2004 to an estimated $24.3 billion in 2014. That's a compound annual growth rate of 33.8%." The company is generating enormous amounts of free cash flow. It also certainly has a solid pipeline.
I absolutely say that there are real risks, as there is in any sort of biotech. You have a company that is not broadly focused and a lot of revenue comes from HIV/Hep-C. Despite the fact that I think these pills are cheaper and less risky than a liver transplant, there could be continued pushback over high prices for treatments like this.
You could have people continue to be skittish over their views of a bubble in biotech and ETF selling could drag the sector down.
Again though, the thing is trading at a p/e in the low teens, which I think not only takes a lot of risks into account already, but undervalues the pipeline the company does have. The company could also certainly make a big purchase again.
With the dividend, I can see it being a comfortable long-term holding and with the valuation being what it is, I think it's actually a good value in a market where values are increasingly rare.
There are certainly risks, but again, I'm happy to collect the dividend and sit on it with valuations being what they are and management having accomplished what they have.
All that said, I'm hesitant to believe that the the company will just be off to the races after this quarter. Analysts are surprisingly concerned about "what's next" (http://blogs.barrons.com/stockstowatchtoday/2015/05/01/gilead-sciences-blowout-earnings-wont-be-changing-too-many-opnions/?mod=yahoobarrons&ru=yahoo) for a company that is generating this level of cash flow and has accomplished what it's accomplished over the years.
But, it is what it is. I'd be pleasantly surprised if it headed consistently higher from here, but would be fine with $100 at least now being a very solid floor.
Additionally, I also find Celgene and its immense number of collaborations very interesting, but that's not a particularly cheap stock. Still, I think it has a bright future, as well.
There is no "real" competition for GILD's one pill regimen for consistently curing Hep. C. GILD owns the Hep. C space. As Scott mentioned, the dividend will allow shareholders to be patient and watch GILD (hopefully) slowly grind higher after today. GILD's cash horde also presents a variety of M&A opportunities.
Sometime my trading stocks turn into longer term holds, such as my position in WWAV.
No need for capital appreciation? No need for dividends? No need to protect against inflation?
How cool is that?
Along with the other members, congratulations!
Following the steps of Alan Greenspan, sounds like.
Very much appreciate your guidance...please keep it coming.
Break, break.
Hi Scott.
No changes since last post.
Man, I'm starting to sound like a buy-and-holder!
Very good today...AA bounced back...as did BAC (Great Pumpkin #2).
AIG has been on a tear lately.
And HCP stopped falling for a change. I understand its situation (I think), but hard to complain given its dividend.
FAAFX (Great Pumpkin #1) had good day......thank you David for hopeful words in your commentary.
Two past holdings remain on watch list: SCHN seems to be getting some love finally...bottomed (perhaps) near $15...back up to $17; GE too, but I think it was not able to maintain recent highs...back under $27 again, or close.
Here in central coast I see most private construction since the dark times. Town homes. New homes. Hotels. New tasting rooms, beautifully designed, and cellars at the wineries. Hey, a "Sold" sign went up today for a nearby home that recently went on market.
So Ted, I feel like you...encouraged.
Fingers-crossed.
If the world can avoid doing something stupid for a while, perhaps our bull has legs.
c
adding to REXX and COG
http://www.nasdaq.com/article/ishares-us-real-estate-breaks-below-200-day-moving-average-notable-for-iyr-cm471388?source=sa
http://seekingalpha.com/news/2479956-rough-month-for-reits?source=email_rt_mc_title&auth_param=12erif:1ak7j69:423c4f696782c2b16ac010bba76289db&uprof=
Not adding to stocks. Too much happy story; I don't feel it, and I don't see it. May take the entire summer to play out (or, maybe not), to find out if I'm mistaken (or, maybe not). Incremental investing in EM bond funds, more so with those which had local currency during last Fall's panic and are still recovering. Still think there's value there (with the understanding there's a bunch of things that could occur and send EM down again). I don't trust the corp junk picture--- nothing seems to affect them, nothing, it's weird--- so only doing "Krug feeding" at ARTFX (1st yr record just completed; near top of list, as expected).
That's the only view I have but I have been getting the impression that it's all due for a blowoff.
Morgan Stanley will be pushing Annuities, big cash deposits with them ect, anything they can made money on....be Careful...
But to each his own...when is enough enough?...good Question...
"My money has to work because I don't" ....Tampabay
I like this thread. It's my favorite next to David's commentary. One can find out what other people are thinking just reading this thread, I think. That's great. Sorry to be late again but it's the work thing.....we're busy right now. Have sold the S&P. I'm putting money in FMIJX, DoDFX, RERFX, and will add some to healthcare, as it's pulled back some. Bought TMSFX some time ago, and all I can say (OUCH!).....will buy more now, though. Had bought FSENX in January. Made some good returns there.....averaged over 11% return. I still think oil has more to go. My MLP's are up....that's really nice for a change....with oil and healthcare the two (2) biggest drivers. In the port, things are looking better now. Right now I'm up over 5% for the year. I'm sure many of you have that beat, but I'm happy with that.
God bless.
the Pudd