This article originally appeared on Seekingalpha.com
- Gilead Sciences’ stock price has increased over 50% in the last year, in most part because of the rapid growth of its HCV drugs.
- Sales of these drugs will not fall off, with plenty of additional growth still to be had.
- Along with the success in the HIV market and potential in the oncology field, the company’s pipeline is currently robust.
- With a cheap valuation and a large cash pile with which to return value to shareholders, this stock is still attractive to long-term investors.
- I Know First algorithm is bullish on Gilead Sciences over the next year, believing the stock price will climb to new highs.
I Know First supplies financial services, mainly through stock forecasts via their predictive algorithm. The algorithm incorporates a 15-year database, and utilizes it to predict the flow of money across 2000 markets. The self-learning algorithm uses artificial intelligence, predictive models based on artificial neural networks, and genetic algorithms to predict money movements within various markets.
The algorithm produces a forecast with a signal and a predictability indicator. The signal is the number in the middle of the box. The predictability is the number at the bottom of the box. At the top, a specific asset is identified. This format is consistent across all predictions. The middle number is indicative of strength and direction, not a price target. The bottom number, the predictability, signifies a confidence level.
I Know First has had success predicting the movement of Gilead Science’s stock price in the past. In this three-month forecast from March 10th, Gilead Sciences had a strong bullish signal strength of 28.06 and a predictability indicator of 0.4. In accordance with the algorithm’s prediction, the stock price increased 16.08% during that time. In the forecast below, Gilead Sciences had a signal strength of 51.38 and a predictability indicator of 0.17 for the one-year time horizon. The stock price increased 47.72% like the algorithm predicted.
I Know First published a bullish articles (article number 1, article number 2) on Gilead Sciences, a biopharmaceutical company with specialties addressing HIV and Hepatitis C, on Seeking Alpha. Having explained how I Know First’s algorithm works and providing an example of its success in the past, it is worthwhile to see if the algorithm agrees with the bullish fundamental analysis of the company. The three-month and one-year forecasts for Gilead Sciences are included.
Gilead Sciences is among the top stock picks for the one-year time horizon. The stock has a weak, bearish signal for the 3-month time horizon, most likely predicting a pull-back in the stock as investors could look to take some profits from the rapid stock price gains over the past year. Over the longer time horizon, the stock price will continue to climb, which is in agreement with the fundamental analysis. With such strong financials, a robust pipeline, and a cheap valuation, the stock price is still at a level that investors should continue buying the stock.
Positive signal strength does not mean investors should automatically buy the stock. Dr. Roitman, who created the algorithm, created rules for entry for a stock such as Gilead Sciences. Using this trading strategy, an investor should buy a stock if the last 5 signal strength’s average is positive and if the last closing price is above the 5-day moving average price. When both of these conditions are met, it is a good time to initiate a position in the stock..