Gilead Sciences Inc. Recent Bull Pattern Might Not Last Long

The bullish pattern of the leading biotech company’s stock has been continuing since early May; it has however come to an end with the recent hit on June 25

Gilead Sciences, Inc. is the definite leader of the rapidly increasing Hepatitis C market, but with growing competition against its best seller Harvoni and Sovaldi, Hepatitis C drugs, it would see its bull period reaching to an end quickly.

Since the start of last month, Gilead Sciences stock has gained roughly 18.89%, and earlier this month the bull pattern increased as the share price surpassed its last year’s high and reached a new record high of $123.37 last week. The stock of the company has also been substantially outshining the shares NASDAQ Biotech index, which has gone up by 11.72% from the beginning of May till June 26.

Gilead share has gained a heavy 18.89% in the similar period. The Gilead's stock was also expressively more than the S&P 500 Index that has only gained 0.77% during the similar time period. However, June 25^th marked an extreme hit to the top biotechnology stock as it captured around 2% to reach the lowest stock price of $119.81, followed by a large number of stock selling, the upside potential stock trader has been much below the mean since it touches its lowest stock price.

The latest hit to the Gilead stock can mainly be due to the increasing success rate of its biggest competitor, AbbVie Inc.’s HCV drug namely Viekira Pak. The latest results from a late stage clinical test shows a 100% cure rate for the use of Viekira Pak, whether or not it is used in combination with ribavirin. This development is the biggest threat to Gilead Sciences Hepatitis C drug , Sovaldi, which has to be administered along with ribavirin only.

The stock is going down since then, the company’s share traded low on Friday and closed at $119.50. The momentum of the stock is dying out now, showing the fact that shareholders are not interested to bid higher stock prices.

The hit shows the level of the blow rivals’ progress in the HCV field can trouble Gilead in the upcoming years as well. Another rival of Gilead, Merck & Co. is planning to introduce a shorter treatment drug for HCV, which is most likely to impact the company’s stock when it will get launch.

However, the sell side firm is significantly bullish on company’s stock. Almost 28 analysts covered Gilead stock, out of which 23 gave it a Buy, 4 assigned a Hold; while just one recommend a Sell rating. The twelve month stock price recommended by analysts stands at $123.79.